What your lenders want in a lending process – but may not say to you.

By: Mike Horrocks

A recent industry survey was published that called out the number one reason that lenders were dissatisfied or willing to go to another financial institution (and take their book of business with them) was not compensation.  While, compensation is often thought of as the number one driver for this kind of change in your bench of lenders, it had much more to do with being able to serve customers efficiently.

One of the key reasons that lenders were unhappy was that they were in a workflow and decisioning process where the lender could not close loans on time, putting stress on the loan officer’s relationships and destroying borrower confidence.  Thinking of my own experiences as a commercial lender, my interactions with the private bankers, branch managers, and lenders that served every kind of customer, I would absolutely have to agree with this study.  Nothing is more disheartening then working on bringing in a client, and then having the process not give me a response in the time that my clients are expecting or that the completion is achieving.

Automation in the process is the key.  While lenders still will need to be engaged in the process and paying attention to the relationship, it can be significantly refocused to other parts of the business.  This leads to benefits such as:

  • Protecting the back office and the consistence of booking and servicing loans.
  • Ensuring that the risk appetite is consistent for the institution for every deal.
  • Growing a portfolio of loans that can and will adhere to sound portfolio management techniques.

So how is your process supporting lenders?  Are you automating to help in areas that give you a competitive advantage with robust credit scores, decision strategies or risk management solutions that are helping close deals quickly or are you requiring a process that is keeping them from bringing more customers (and profits) in the door?

Henry Ford is credited to say, “Coming together is a beginning. Keeping together is progress. Working together is success.”   Take a closer look at your lending process.  Do you have the tools that help bring your lenders, your customers, and your organization together?  If you don’t you may be losing some of your best talent for loan production at a time when you can least afford it.