Convenience: Around-the-Clock Demand

Matt Blumenfeld
February 8, 2010 | COMMENTS

Credit unions have a big opportunity now to position themselves as the most convenient choice for consumers who need a loan, according to Lee Kolquist, CEO at Lending Solutions, Inc. in Elgin, Illinois.

But that will require credit unions to become much more efficient, while convincing consumers the credit union is the best place to meet their needs.

"When they have less resources and they look at growing their lending, we believe that contact and getting members a decision efficiently is an opportunity for us and addresses the challenges that they face," he said.

Mortgage volume at LSI 's clients was at an all-time high in 2009, up 40% over one year earlier. Kolquist projects refi volume will cool, but purchase mortgages will keep growing.

"What's driving that is the convenience; credit unions recognize that they have to continue to differentiate themselves and be convenient to the member that demands service in the next five minutes, not 24 hours," said Kolquist. "If they position themselves from a convenience standpoint by availing themselves around the clock and expedient decision-making they can restore [consumer] confidence and can do it in a cost-effective way."

While some credit unions are going into a shell to protect their balance sheets, those that are being the most creative and aggressive in an rough environment of declining credit and falling home values are profiting now and stand to be in an even strong position when the broader economy recovers substantially. "It is going to be a good year to take advantage of those opportunities," said senior vice president of sales Jeff Frantz. "We're seeing credit unions doing a much better job advertising that they are in the mortgage loan business."

Kolquist is confident that credit unions can make up for the slower nationwide auto sales by grabbing an ever-increasing slice of the pie. "There is a huge opportunity for credit unions to differentiate themselves based on what has happened in the last 18 months," he said. "Now they recognize it and now they can execute it."

This article appeared at www.cujournal.com and is reprinted with permission.