Credit Union Lending: Learning To Hustle

I remember as a boy going to spend the night with a friend.  His mother worked evenings and had not been told I would be spending the night and was naturally put out with her own son for inviting me over.  She handed her son one dollar and said, “Fine, he can stay but you are going to have to hustle for your supper.” With that she showed us a bare refrigerator and left for work.  My own mother was a waitress so I was not alarmed by the empty refrigerator. However, I was concerned over the whole concept of “hustle for your supper.”  My friend then flashed a big smile and said, “Come on, it’s time to hustle.”

Before long we had turned the house upside down looking for spare change. Our one dollar had grown to five dollars in spare change found under beds, in dirty clothes, and behind the cushions on the sofa.  I was amazed so much money was literally just waiting to be picked up.

We got on our bikes and peddled to the corner store where we bought a “soup bone” and some carrots and potatoes.  I also insisted on a can of “mixed vegetables” to round out our “hustle soup”.  As we headed back to his house I was so excited to see how our soup was going to turn out. We boiled the bone with the vegetables and added the can of extra veggies at the end.  As I recall the soup was one of the best I had ever had. It was part water, part scrawny carrots and potatoes, and a great deal of “hustle”.

I have given a great deal of thought on two recent blog postings, “Credit Union Culture Cooperative or Cut Throat” and “The New Credit Union Mantra: Stop Breathing”.  Both posts got a tremendous response on the blog and on various credit union discussion groups.  The comments clearly showed people who longed for the “old days” of when credit unions truly thought of themselves as cooperatives.  So that led to the idea of the “hustle soup” from my childhood memories.

What we need is to each add a small tip to the soup. Since we are all in lending season I thought it might be worthwhile to throw in “lending tips”.

So my tip is that of using chat to generate loan volume.  Many financial institutions use  web chat so this is not cutting edge technology. However, most use chat as a general member service tool.  I think this approach adds complexity to your call center operations. Chats typically take twice as long as a phone call. So while you have added another channel for your members you have added a channel that takes twice as long to fulfill the same type of service request.

Rather than using chat as a general member service function use it only on your rates page.  Change the title of “Chat” to something more specific, “Connect with a Loan Specialist.”  Instruct your chat specialist to turn every chat into an outbound phone call when possible. 

Just this week I had an agent come up to me so excited about a web chat that he had earlier in the day. The member started the chat off the rates web page and asked about our lowest rate.  The agent asked if he could call the member to more quickly cover all his options and give him the solution that best fit his need. As they were talking the lending agent offered to review his credit history prior to taking the application so that they could present the best possible application to the underwriters.  As the agent went over the CBR he noticed three trade lines that could be refinanced at a lower rate. The end result was that this web chat generated three applications for a total of 65,000 dollars that booked that same day.

That brings up my second tip which is training your lending agents to take double and triple applications. Too often loan officers become order takers and they forget that their primary role is that of saving the member money by borrowing money at a lower rate or helping a member refinance to a lower rate.

This primary function requires people who love to help people with loans. Only the best of the best should be loan officers.  Once you have these people you need to remove all non sales duties from them.  You don’t have your most passionate lenders doing the paperwork. You give the paperwork to people who love paperwork!  Make sure you prioritize call routing in your call center so that you have a pure application queue. Contrary to what you may think all calls are not created equal.

You can do this in your branches as well. Use your first impression station to funnel lending opportunities to your best lending specialist. Try to keep them as busy as possible taking application after application. You have other people in the branch who like to balance checkbooks and open certificates.

Lastly, you only use web chat on your lending page.  You make sure it is the highest priority. Think about what you have here.  You have a person on your web page wanting to talk rates! That is a golden opportunity you have to make the most of.

I typically see centralized lenders who have focused duties generate as much as a whole branch.  I kid you not. A good phone lender who is set up correctly can generate around 2-3 million in applications and book between 450,000 to 900,000 thousand in a month. I realize that this depends on the volume you have.

My main point is that you don’t have your best lending officers balancing check books for people. You have other people who would love to do that but have no desire to do lending. You want people to do lending who are not afraid of having to make their own “hustle soup”.

Alright, I have added my two tips for lending success now it is your turn.  It is time for each of us to act like we are all part of a cooperative.  This might be hard to believe but this blog has readers from all over the world who can add something and gain something. Each of you can contribute and make this posting the ultimate cheat sheet for lending success.  Each of us has Big Banks or other giant competitors we have to go up against each day. Let’s all add something here. Small credit union or large we are in this together…. it's time to hustle for our supper.