Unlocking the Right Mortgage Experience for Buyers

After an eight-year dip, mortgage debt is on the rise. As of this past January, American households owed a total of $9.12 trillion in mortgage debt, nearly as much as in 2008 during the early stages of the housing bubble, according to a mortgage industry study from SuperMoney. Competition among lenders is fierce, and the playing field continues to change. Big banks have long dominated the mortgage lending industry, but other real estate companies are taking advantage of technology to expand their services and wade into lending. However, at Golden 1 Credit Union, we believe credit unions can bring consumers something other lenders can’t – delivering the credit union difference with a human touch.

Automating and digitizing the mortgage process can be appealing because it appears to streamline applications, save time and reduce costs. More lenders – both traditional and nontraditional – are turning to the internet to modernize home buying. Amidst so many online options, it can be overwhelming for a consumer who just wants to buy a home.

While we are all conducting more transactions online, buying a house isn’t the same as ordering groceries, gifts or cleaning products online and having them delivered the next day. Purchasing a home is one of the biggest and most complex financial transactions most people will ever make, and an online-only buying experience may lack a personal commitment to the homebuyer. Further, the front-end time saved is often sacrificed on back-end paperwork, as the documents required to buy a house don’t change if you apply online.

Golden 1 has taken a different approach to mortgage lending, especially for home purchases. We continue to invest in the human touch by hiring experienced home loan advisors to work in our branch network. While consumers increasingly want convenience, they also want reassurance during a purchase as large as a home, and they won’t necessarily find that online. They want – and need – an expert to talk to. Our home loan advisors do not “sell loans,” but rather advise potential homebuyers of the options available to them and help them find the right fit. We have also opened two Home Loans Centers in California’s Bay Area, one in Campbell and one in Pleasanton. While investing in brick-and-mortar would appear to go against the grain, we believe we are exactly where consumers want us to be. We plan to open additional Home Loans Centers throughout the state to provide our members with personalized, one-stop shops for lending.

Our network of in-branch home loan advisors and Home Loans Centers provide Golden 1 the opportunity to do what we do best – bring the credit union difference to life by providing a personalized experience and in-depth expertise to what can be a daunting process. Millennials, the largest generation in U.S. history, are entering their peak home buying years. This generation faces unprecedented challenges, including a low housing supply and rising home prices. Many millennials also carry substantial student loans, making saving for a down payment difficult. Not all companies are equipped with experts who will dedicate the time or resources to help these potential homebuyers research and find the best fit. We believe it’s important to deliver the right product and attract the right talent to help this generation navigate the process.

The value of offering a face-to-face loan experience and brick-and-mortar locations cannot be underplayed. Consumers like to see this commitment to their communities. As we augment our branch network with Home Loans Centers, we can approach emerging markets efficiently and with a greater presence. We offer more than a building – our home loan advisors are active and involved in the community. They work closely with hardworking Realtors to provide homebuyers with a great experience from start to finish. Relationships are an important part of the home buying process – according to a recent study by Fiserv, 30% of those who recently applied for a mortgage said prior experience with a lender was an important factor in their choice.

Our first two Home Loans Centers have been well received. People in Campbell have said it’s refreshing to see Golden 1 commit to the community when other lenders are consolidating. Golden 1 did not previously have a presence in Pleasanton, and we have enhanced our relationships with the community and Realtors. We have quadrupled our year-over-year business in the market since our Home Loans Center opened.

As much as lenders want to increase efficiency in the mortgage process, they may find it necessary to make greater investments in the customer experience. Some customers might prefer to conduct some of the process online and finish it face-to-face. Others may want a mostly online process for refinance or home equity transactions. Lenders must deliver the proper tools and solutions to consumers or risk having them go elsewhere. Golden 1 remains committed to providing an efficient, yet personalized, mortgage process no matter the channel – online, on the phone or in person. We will continue to invest in our people, our technology and the communities we serve.

Greg Brown is Chief Lending Officer for Golden 1 CU. He can be reached at 916-732-2900 or gbrown@golden1.com.