Normally, when I write this column, I have my Chairman/CEO hat of Prime Alliance on. Today, I am putting on my Vice President of Product and Delivery Channels/Chief Lending Officer of BECU on. Why, because our credit union has done something truly extraordinary using the Prime Alliance platform and I am very excited to share this even with you.

About two years ago, we began originating and processing mortgages completely without paper. No paper applications, no paper files, and no paper documentation. Our mortgage staff, our call center staff, our branches and our members all use the same on-line, real-time technology for the latest news on every member loan.  

It works. One of the measures we use is closed loans per FTE per month. We're consistently handling 18 closed loans per month per mortgage employee, easily twice the national average. Our cost to originate has plummeted by as much as 62 basis points per loan. In a commodity business, where price matters, this helps us not only compete, it helps us lower the cost of homeownership for our members.

Think, too, about the more esoteric efficiencies a paperless mortgage process creates. No paper means no files. No files means no paper chase. Since it's all on-line, it all available all the time. No more lost documents, no more post-closed broken loans to fix. That adds to our efficiencies, and lets us use staff time for more provident purposes, like working with our members. There's also no paper to store. Storage costs, in terms of office space and off-site storage space, can add significantly to costs. We have none.

How much more do we expect to save? We'd like to see the 62 basis point number in savings get closer to 100. We think we can do it. While we're very efficient now, there's more still to be done.

Paperless Lending: Competitive Differentiation

Another reason we're going completely paperless is because it will distinguish BECU from most other lenders in Puget Sound. This is a commodity business, as I've mentioned already, not as if you didn't know that.  We all compete on the same basic prices. All that's left is service: if BECU can close faster than other lenders, BECU will not only get the loan, but the reputation as the fastest, most reliable, most technologically advanced lender in our area. This is a sustainable competitive advantage for BECU and one that will benefit the credit union in its entirety. 

A member recently came to us for their loan, but only if we could guarantee closing in 10 days or less. Apparently another lender told them this was possible. They really wanted to work with us. Ten days is typically no big deal. We got the loan.

Being paperless certainly helps make such short closings possible and commonplace.  Not too long from now—6 months, 12 months, 18 months—5 days may become the norm. We're ready.

You better be, too, if you hope to compete. The good news is if you are a Prime Alliance credit union, you have access to the same tools and services that I do.  Service, trusted, reliable accurate service is the new competitive differentiator for mortgage lending, especially after what's gone on with sub-prime lending in the past 12 months.  We're not only ready; we're ahead of the industry.

What are you waiting for? My advice, don't wait long. There's been an irrevocable shift in the mortgage market. Borrower confidence is rattled. Efficient, reliable and cost-effective are what borrowers are looking for. While you can be reliable without being paperless, you cannot be efficient, and you cannot be cost-effective.

And if you're going to do it (and you must) go head first. No long pilot programs, no testing the waters. Do it all, do it completely.  Everyone—your borrowers, your staff, and your bottom-line—will be the happier for it.

Mortgage lending will be a paperless business within three to five years. The most competitive of us are there now. Those that wish to catch up better start now.  Those that hesitate, well, those that hesitate are lost.  

A Better Way of Doing Business
By Tammy J. Trefny, Senior Business Manager—National Affinities Team

You've set your goals to reduce operational costs and expedite your loan cycle—now it's time to execute.

eMortgages can help streamline your delivery-to-investor process alternatives. Paperless mortgage transactions, including electronically signed mortgage documents, offer a fundamentally better way of doing business.

What you need to know:

• eMortgages can save you time, offer better quality control, and expedite closing. Paperless mortgages provide better customer service with fewer errors, faster closings, and increased transparency to the borrower/member.

• eMortgages can provide a secure alternative. The data integrity of eMortgages is protected with the use of a tamper-proof digital seal. eMortgage technology is based on widely accepted industry standards. 

• eMortgages can reduce costs. You can realize cost savings after closing your first eMortgage with virtually no capital investment. Courier fees are eliminated and, in most cases, loans can be sold to Fannie Mae the same day they close, boosting liquidity for you. These savings can positively impact your borrowers’ bottom line and continue to emphasize credit unions as the “low closing-cost” provider of mortgages. View the following documents to learn more about the benefits of eMortgages:
  
  

  eMortgage Delivery at a Glance (.pdf)
  
  How to implement eMortgages (.pdf)
  
  Getting Started with eMortgages (.pdf)
  
  Research Findings (.pdf)
  
  Mortgage Technology Article (.pdf)

  You can also learn more about the advantages and processes of eMortgages, as well as a credit union case study on Callahan & Associates’ creditunions.com site: http://www.creditunions.com/home/articles/template.asp?article_id=2472
  
  

Going Green in the Workplace
By David J. Miller, Jr., President, Prime Alliance Loan Servicing

Helping save the planet can happen at work too! You wonder how? Well, whether you work from home or in an office with few or many employees, there are ways to “go green” and have an impact on the environment. At Prime Alliance Loan Servicing - Powered by Cenlar, we have been going green for years, and we offer you a few tips on going green the easy way in your workplace.

Start “going green” today

1. Provide your employees with a company mug - This reduces waste, saves money and increases morale.
   
   
2. Decorate with plants - Fake greenery may be low-maintenance, but real plants bring the benefits of oxygen and beauty to your office. It also eliminates CO2.
   
   
3. Replace aged desktop computers with laptops - This saves on electricity as they use up to 70% less electricity and generate less heat waste. At Prime Alliance Loan Servicing, we went greener by replacing CRT’s with thin-panel monitors (aka LCD monitors) on many of our desktops.
    
4. Turn off equipment - Adapt a “Power down when not in use” campaign.  Computers left on use electricity and cost your company money. 
   
   
5. Ask the question - Why print?  E-mails capture data electronically and can be archived forever. Avoid printing documents that could easily be e-mailed and when necessary to print use the two-sided print option. We can all improve in this easy going green tip!
   
   
6. Purchase recycled paper for copiers and coffee filters - Better yet, buy filterless coffee makers or reusable coffee filters. We have been purchasing recycled paper for years and have saved considerable dollars doing so.
   
   
7. Recycle and Compact your trash - Start with newspaper, toners, bottles and cans, and shred when applicable. You will save the landfills. Why stop there?  Engage in a certified recycling service for used computer and telecommunications equipment.
   
   
8. Check your thermostat! - Each degree set warmer in the summer, and cooler in the winter will save an estimated 6-8 percent in energy costs. We have implemented through a timer system, setting our thermostats lower/higher in the evenings after our offices close.
   
   
9. Consider telecommuting! - It’s obvious cost savings in space, electricity, heating/air conditioning requirements as well as green savings through less CO2 in the air and costs of gas.
   
   
10. Video Conferencing - Reduces travel expenses and saves CO2 in
    the environment.  
    
    
11. Server Virtualization - This technology creates virtual file servers – as many as 10, 20, or more on a single physical server. This saves space, heat, air conditioning, and electricity, not to mention reducing the man-hours required to administer and maintain server hardware and software. 
    
    
12. Out with the old and in with the new… - Replace old Storage Area Networks (SANs) with new models. This will save a great deal of physical space, produce far less heat, and consume far less electricity not to mention be more scalable.

So, if you still wonder why the office should be more eco-friendly just think how much better the world we live in would be if we all worked together towards a better tomorrow - be it at work or home - and went green!