Grow Your CU with Mortgage Servicing

Don’t discard member relationships by outsourcing your CU's mortgage servicing.

December 01, 2010
KEYWORDS mortgage , servicing
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Credit unions all hold one maxim in common: "The member relationship is the most important aspect of our business."

Yet, many credit unions are all too willing to throw away a hard-earned relationship by either outsourcing servicing or selling their servicing rights which could result in the credit union losing the golden opportunity to cross-sell additional financial products or the customer altogether.

Sound crazy?

Many credit unions do this every year when they close a mortgage and release servicing to other institutions. The benefits of retaining servicing are well established, but too many credit unions let the fear of extra work or costs dissuade them from taking on a very profitable activity that improves long-term member relationships.

Retain Servicing to Enhance Member Stickiness

People choose to do business with a credit union for many reasons.  While most people say rates are the number one factor in selecting a mortgage provider, most consumers also want to work with an organization they trust and that will provide them with high quality service.

Credit unions excel at building relationships with their members, but all too often, releasing servicing to another organization can damage those relationships.

"Member complaints were one of the primary reasons we decided to bring servicing in-house," said Angela Bassett, real estate manager for Alexandria, VA.-based NAPUS Federal Credit Union. "We were receiving multiple complaints each day from our members regarding the lower levels of service they experienced in seeking information or handling their mortgage loans."

"Our members receive better service when we handle the servicing of their mortgages..."

- Jason Ambrose, Mortgage Loan Officer at COMSTAR FCU





"When it comes to member relationships, the benefit of servicing mortgages in-house is the ability to provide borrowers with the quality of service that the member expects from a credit union.  It is especially important that credit unions maintain a high level of member satisfaction, since mortgage loans typically provide income and a long-term borrower relationship for many years to come.

"Being a credit union, we pride ourselves on delivering excellent service to our members," Alan Fuller, manager of Mortgage Servicing for Olympia, Wash.-based Washington State Employees Credit Union. "We utilize FICS' Mortgage Servicer and eStatus programs in order to give our borrowers instant access to their loan information online and in our branch. 

Retaining servicing also enhances other financial services channels.  Mortgage borrowers may also need auto loans, student loans or savings accounts, and their experience with the servicing department - positive and negative - will affect these other lines of business.  The ability of credit unions to cross-sell other products to members increases when they retain the servicing rights for the mortgage.

"Our members receive better service when we handle the servicing of their mortgages," said Jason Ambrose, mortgage loan officer for Fredrick, MD.-based COMSTAR Federal Credit Union.  "Mortgage Servicer is very user-friendly and gives us the tools we need to not only meet our members' expectations but also to reduce the costs and time spent processing payments, handling escrow accounts and reporting to regulatory agencies."

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Great article! Unfortunately, most employees don’t feel valued or appreciated by their supervisors or employers. In fact, research has shown that the predominant reason team members quit their jobs is because they don’t feel valued. This is in spite of the fact that employee recognition programs have proliferated in the workplace – over 90% of all organizations in the U.S. has some form of employee recognition activities in place. But most employee recognition programs are viewed with skepticism and cynicism – because they aren’t viewed as being genuine in their communication of appreciation. Getting the “employee of the month” award, receiving a certificate of recognition, or a “Way to go, team!” email just don’t get the job done. How do you communicate authentic appreciation? We have found people have different ways that they want to be shown appreciation, and if you don’t communicate in the language of appreciation important to them, you essentially “miss the mark”. Additionally, employees need to receive recognition more than once a year at their performance review. Otherwise, they view the praise as “going through the motions”. A third component of authentic appreciation is that the communication has to be about them personally – not the department, not their group, but something they did. Finally, they have to believe that you mean what you say. How you treat them has to match the words you use. If you are not sure how your team members want to be shown appreciation, the Motivating By Appreciation Inventory (www.appreciationatwork.com/assess) will identify the language of appreciation and specific actions preferred by each employee. You then can create a group profile for your team, so everyone knows how to encourage one another. Remember, employees want to know that they are valued for what they contribute to the success of the organization. And communicating authentic appreciation in the ways they desire it can make the difference between keeping your quality team members or having a negative work environment that everyone wants to leave. Paul White, Ph.D., is the co-author of The 5 Languages of Appreciation in the Workplace with Dr. Gary Chapman.

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