MortgageClick Finds Niche in Powering Process for Smaller CUs
The privately held Massachusetts firm specializes in delivering the Prime Alliance mortgage technology solution to small- and mid-size credit unions at member-facing points of delivery-the teller line, branch representatives, call centers and online.
Helped in part by the increasing complexity of interest rate structures and compliance requirements, MortgageClick now directly serves about 80 credit unions and several dozen more through CUSOs.
Upheaval and systemic change in the mortgage business which has driven consumers to credit unions also has driven credit unions to MortgageClick, its executives said.
"As rates dropped and the subprime problems built among the national lenders, it became like a tsunami of activity sweeping into credit unions, and many of them really couldn't handle the volume," said Dan Hanlon, the five-year-old company's chief operating officer.
MortgageClick's response is a shared network that provides each credit union client with a private-labeled loan application process-powered through Prime Alliance's delivery of the Desktop Underwriter solution from Fannie Mae-that it said can deliver a completed, compliant application in less than a half hour.
The solution also eliminates the need for specialized training in mortgage origination, requires no special hardware or extensive IT support and can handle first mortgages, home equity lines and second mortgages alike, the company said.
"We're mortgage people serving up a technology solution," Hanlon said. The mortgage process can be particularly complex and labor intensive, and Hanlon said his company has thrived by "being able to train, hold hands and help our clients get through obstacles from end to end."
At the front end, that means empowering member-facing staff to provide quick answers to such basic questions as "What's my best rate? and "Do I qualify?"
"Not too long ago we'd be talking about maybe five pricing adjustments with Fannie Mae, and I could carry the rates around in my head," said Stan Kutzko, MortgageClick's senior vice president. "That's certainly not the case anymore."
"When someone comes into a credit union with those kinds of questions, we don't want credit union staff to feel like they have to run and hide under their desks."
Automating complex rate determinations up front also helps avoid situations where credit unions can unknowingly dangle attractive rates in front of consumers who soon find out they're not really eligible, the MortgageClick executives said.
The solution also helps credit unions keep up with shifting compliance regulations and can deliver time-saving tools such as electronic signatures, Kutzko and Hanlon said.
"The day is coming," Hanlon said, "when members will be able to apply for a mortgage, scan in pay stubs and e-mail them, sign the documents and, ultimately, do a closing without ever leaving their leaving room."
The MortgageClick solution also can be customized to fit each client CUs specific policies, and that varies from client to client.
"We have some that want to make every change in lockstep with Fannie Mae and others that want to do a lot more of their own policies, and we can support them either way," Hanlon said.
MortgageClick also plays well with the smaller staff size of "smaller and mid-size credit unions that don't have mortgage experts who do nothing but those eight hours a day," Hanlon said. "A lot of our clients have people wearing a lot of hats, and they can't keep up with every single rule and change."
The solution also can support either holding mortgages or selling them into the secondary market and can prove to be a real money saver for credit unions that want to venture into the sometimes-treacherous waters of the latter, MortgageClick said.
"You can easily be out $3,000, $4,000 or more on a $200,000 loan if you miss an adjustment in the secondary market," Kutzko said, "and then there are the pitfalls of the disclosure and investor requirements."
"We're not saying we're the end all and be all with this, but we have been down some of these roads."
Hanlon and Kutzko also tout MortgageClick as an efficient way to gain access to the Prime Alliance platform, which they said can be too pricey for smaller credit unions that don't generate big enough loan volume to justify the price tag.
"Basically, if this lets you generate just one extra loan a month, it'll cover your costs with us," Kutzko said.