3 Keys To Mortgage Success

Back in March, we challenged you to re-look at your plan for growing your mortgage portfolio. If you've developed a plan by now… great, you're ahead of the game! If not, there's still time to formulate a growth plan and implement it right now. With rates dropping even further over the last three months, credit unions have been forced to explore all of their options in order to keep up with the growing demand for mortgages. Keeping up with the high demand is one problem. The other question to address is ''What about when rates go up and the market slows down?'' With that in mind, let's look at 3 keys for mortgage lending success in any market.

Key #1: Marketing

As with any of your programs, mortgage lending will not be successful unless you market it properly. Effective marketing starts with two questions - (1) What about this program will interest my members? and (2) How can I convey these benefits in a meaningful and cost-effective way?

The most obvious reason your members will be interested in your mortgage program is to save them money. With rates at record lows, you will be one of thousands of companies that can give your members a great rate, and one of several they will shop. So, what other factors besides price can you compete on? Service and convenience would be the next issue to drive home to your members. Let them know that you not only offer great rates, but exceptional service. If you have extended or weekend hours, make sure your members know about it. Your availability alone can make you more competitive. If your members know they have a choice between going to a mortgage company (where they don't have a relationship) or using their credit union (where they already do their business), a good percentage of members will at least check out the their credit union for their mortgage needs. It would be a huge misfortune to have a great product with great member service and not to let anyone know about it.

Second, in order to convey your message to your members, analyze your marketing mix to see what's working the best. For some credit unions, a radio advertisement can bring in loads of business. For others, having tellers passing out flyers will do the trick. The bottom line - it's important to get your message out at multiple levels with consistent frequency. Here's a list of ideas and locations for your messages to help you get started:

    * On-Hold Message
    * Statement Stuffers
    * Web
    * ATM Receipts
    * Teller Buttons
    * Magnets
    * Newsletter
    * Lobby Posters
    * Newspaper Ads
    * Postcard Mailers
    * Relationships With Real Estate Agents

Key #2: Finding the Right Partner

The next step towards competing effectively is to find a reliable lending partner to help you serve your members' mortgage needs. There are a variety of specialized mortgage companies in the marketplace. You may need a full service partner to handle everything, or you may just need someone to help with the application processing. The key is to choose a partner that has the right mix of services to meet your specific lending needs. For Tinker Federal Credit Union (Oklahoma City, OK), they needed a partner that could help them process their mortgage loans and deliver them up to the point of closing. Troy Martens, Mortgage Manager at Tinker FCU states, ''Over the last two years we've averaged between 30%-35% growth in our mortgage business. By partnering with LSI we have been able to handle the influx of mortgage business that has accompanied the low rates. Outsourcing part or all of their processing functions is definitely an option credit unions should reflect on when considering how to handle increased loan volumes''. Research to find a partner that fits in with your credit union's culture and one that will represent your credit union admirably when dealing with your members.

Key #3: It's All About Service

The third key, service, works hand-in-hand with the first two keys and ties everything together. Great service can be your best marketing tool, as it inevitably fuels the coveted ''word-of-mouth'' marketing. When you provide exceptional service to your members, you are setting the stage to gain their business next time they are in the market for a mortgage, as well as any other loan they may need in the future. Additionally, chances increase that they will tell someone about their positive experience and the credit union could gain more business from referrals.

Second, in order to provide great service, you will need to find a quality mortgage partner that offers excellent service. A great litmus test is to look for a company that treats your members as good as or better than you treat them yourself. When looking at companies, be sure to visit their operation first-hand and observe how they handle member interaction.

Your members expect better service at their credit union than they do from their local mortgage broker, and it's your job to make sure they get the great service they expect. Following these three keys will help you handle the increased business while rates are low, but will also give you the foundation necessary to succeed when rates increase and the market cools down.