GETTING OFF THE LOAN HAMSTER WHEEL

Transcription

1 GETTING OFF THE LOAN HAMSTER WHEEL SUCCESSFUL LOAN RETENTION STRATEGIES Joe Brancucci Theresa Mann President, CU RateReset President & CEO The Partnership FCU

2 JOSEPH (JOE) BRANCUCCI

3 THERESA MANN

4 Facts Environment New Competitors What other credit unions are doing Session attendee retention suggestions KEEP A LOAN KEEP A MEMBER!

5 FACTS

6 Average of 6-9 months of new loan production to replace repayments each year Auto loan average life of months not because of new car purchase Regulations contribute to member anxiety Click-it providers make refinance and capture easy Credit Unions use refinance process L for modifications Loans are originated with destination being pay off

7 REGULATIONS

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9 270 Days of Member Angst = High Potential Loss of Loan

10 Requirement of Ability to Repay - Without Digital Models Difficult to Avoid Manual Processes

11 CURRENT EXPECTED CREDIT LOSSES

12 COMPETITION

13 TRADITIONAL COMPETITORS

14 As you are viewing this, there are a lot of entities working to steal away your loan, both in your market and on the internet!!

15 NEW COMPETITORS

16 HAVE 500,000 MEMBERS AS OF MAY 1, 2018

17 $4 billion in loans to 130,000 small business Use digital technology and data analytics for approval and monitoring Credit unions ask for lots of data and then renewal data refinance at Kabbage

18 80 million USA members 64% of all households 79% of millenniums purchase something each month Largest membership club in the world

19 SUCCESSFUL CREDIT UNION STRATEGIES

20 RETENTION STRATEGIES THAT WORK

21 RETENTION STRATGIES THAT WORK THE PARTNERSHIP FCU NON-LOAN RETENTION PROGRAMS evaluator Rate Retriever Credit Counseling Zipline New Reverse Personal Loan VIP Value LOAN RETENTION PROGRAMS HELOC interest rebates for new money CU Rate Reset auto and personal loans Average 24 months longer Average bp increase

22 SUCCESSFUL CREDIT UNION STRATEGIES üdigital TRID notice 10 months before first adjustment.. 76% success rate üoffer member another fixed period on an ARM ütrigger Programs to combat member pre-payments üdigital modifications of auto loans to expand term or cash out % success üallow members to reset ARMs every year üallow members to reset ARMs every 4 months

23 SUCCESSFUL CREDIT UNION STRATEGIES üinternal trigger programs member looking at new cars, checking rates, checking out repayment amount ümaking the loan value a part of a bigger Member Value proposition give them a reason to stay ütrain staff to recognize member queues ücontact every pre-payment request ücounter pay-off funds receipt with mod offer

24 TABLE DISCUSSION Each table has 5 minutes to come up with loan retention ideas Select a spokesperson to capture table ideas Present 3-5 ideas to the group What new ways to retain loans, and ultimately membership, should a credit union consider employing?

25 ATTENDEE RETENTION STRATEGIES Use CU Reset solutions to offer member lower rate if credit score has improved Develop a Hybrid HELOC that allows member take down of a portion of the line and terms that portion out Expand skip-a-pay programs Aggressive outreach to members with a pay-off request Discounts for payroll orother relationships Fresh Start suite of products manage the risk model and tailor products to meet the broadest group of member

26 ATTENDEE RETENTION STRATEGIES Refi offers with guaranteed discounts Discount loan for taking ancillary products like GAP, debt protection, etc Student credit card for small amounts to begin relationship with young members Trigger program alerts with immediate outbound counteroffer to member Refinance analyzer (Symitar product) Balance transfer offers on a regular basis for credit cards and personal loans Program in place to modify loans to lower payment Creative finance to include other products to help lower member debt service

27 THANK YOU FOR PARTICIPATING Any questions? KEEP A LOAN KEEP A MEMBER!