Twenty five percent of Americans belong to credit unions. In 2004, credit unions originated just 2% of mortgage loans.
To grow that market share, suggested Ginger Williams of CUNA Mutual Mortgage Corp., credit unions will need to appeal to the country's changing demographics, specifically, the fast-growing Hispanic market, along with other minority markets eager to own homes or trade up.
Moreover, credit unions simply need to become more "innovative" and aggressive in mortgage lending, noted another person, who shared what her own credit union has done to increase volume (see related story at left).
Williams told CUNA Mutual's Discovery Conference that often the internal, competitive issue isn't how can we do something, but "why can't we?"
In the case of CUNA Mutual Mortgage, it has rolled out an Hispanic initiative that includes marketing materials in Spanish. Williams pointed to Ukrainian Credit Union in Rochester, N.Y. which has mortgage materials (including a website created by a teller) in Ukrainian.
Another trend cited by Williams that credit unions must embrace is the "anywhere, anytime" service levels consumers have come to expect. In mortgages, people are coming to expect similar service, including quick appraisals and closings. "You have to be able to accommodate people any way, anytime they want, and do it more quickly," she said. "When borrowers come in to see you they want to hear one thing: approved. They don't want to wait for a senior loan officer to approve the loan. They know they can get on the Internet and get a mortgage."
To reach the purchase market is going to require far more effective marketing, said Williams, no easy task in a society with commercial-deleting Tivo and Spam-blocker online.
When Williams asked the room who had opened an account at an institution as the result of a flyer received in the mail, no hands were raised. When asked who had financed a loan according to a real estate agent's recommendation, a half-dozen hands went up.
"In marketing, personal contact is where we are going, and that's where credit unions have an edge," said Williams.
Williams gave credit unions a "New Product Checklist" for any credit union looking to do just that. The checklist:
* Who will benefit from this program. "Some of the new products are so expensive, that by the time you buy it and train staff you're never going to get your money back on it," she said.
* What are the goals with the product?
* How will the product be marketed?
* Does our current technology system support the product?
* What is the timeline for implementing the new product?
