AUSTIN, Texas - There's no such thing as getting a loan decision to a member too quickly. Whether a credit union is dealing with a consumer loan, auto or mortgage, speed and quality control are of utmost importance. An increasing number of credit unions in the country are delivering loan application decisions to their members in the fraction of the time it typically takes for off-line application approvals, and the whole process is transparent to the member. ARC Systems' flagship product LT2KT has been on the market since Feb. 1998 and as of Feb. 2000, the company says 5,800 loan application decisions have been made through the Internet-based automated credit evaluation tool, totaling $2.8 billion in loans. The most important element of LT2K is its ability to be customized to meet the financial's needs, says ARC Systems' President Edward Jones. "We don't try to establish a pattern," he explained. "The LT2K design engine can write specific instructions in code and build the application, depending on what the lender needs. It's very lender specific, depending on the lender's guidelines." Jones says the nicest feature of LT2K is that it's applicable to any process that involves a credit union decision. For example, more than 80 credit unions in the U.S. are currently receiving lending decisions to members' loan applications for consumer loans from LT2K software through the company's agreement with FIData, Inc. in Austin. Beyond lending products, the system can also support decision processing for insurance applications, tax verifications, and provide credit information to third parties for employment decisions. The credit union's loan application is accessible on their Web site. Members' completed applications are sent as an electronic file to ARC Systems, which in turn runs the application through the company's central server. In about 30 seconds, the applicant's credit history is sent to the three leading credit bureaus beginning with the one the credit union designates as their preferred credit bureau, a credit report is obtained, the loan is underwritten and a decision is returned to the member with pricing and stipulations. LT2K users pay a per application fee that varies based on the loan product. Jones says mortgage products typically involve a $35,000 one-time set up fee, a $7,500 per product matrix fee and a transaction fee. Personal loan fees vary from $10-$15 per transaction. Jones said ARC Systems technology is designed to compliment the lending operations of the lending institution. "The important thing is not to try to fit the borrower into any particular niche and to let the lender remain in control of their lending guidelines." -
ekingoff@cutimes.com
