The $2.1 billion, Briarwood, N.Y.-based Melrose Credit Union isgiving rave reviews for its experience with the Raleigh, N.C.-basedSageworks' new Electronic Tax Return Reader, which the credit unionsaid helps improve underwriting efficiency.

Sageworks introduced the Electronic Tax Return Reader as a majortimesaving enhancement to its suite of credit risk managementsolutions for financial institutions. The complimentary upgradeautomatically imports data from borrowers' tax returns.

“I am ecstatic with this product so far,” Steven Krauser, seniorvice president of retail operations for Melrose CU, told CUTimes.

He explained that because the credit union's lending portfoliois so diverse, systematizing the evaluation of its underwritingprocess was a priority. Based on the NCUA's requirements, thecredit union needed to provide the matrix for evaluating a loan ina standardized manner across all product lines.

Krauser, who joined Melrose CU about a year ago, explained oneof his goals was to study what the credit union could do better andbegan researching software that would allow him to do that.

“We started in business in 1922 in taxi medallion financing,”Krauser said. “We have a significant portfolio in that. That is onereason we wanted to get involved in this.”

The credit union desired the ability to flag any problems inadvance by adjusting and stress testing its portfolio, and toquantify and maintain its methodology.

Melrose CU, which has an open charter and one branch,investigated which lending modules would integrate with its core system's existingdata as well as standardize underwriting within its departments.The Sageworks suite, Krauser explained, allows the credit union tostress test its portfolio based on numerous factors such asloan-to-value, debt service coverage ratio changes and interestrate increases.

The credit union started fully underwriting with the system onAug. 4, 2015.

“The quality of the underwriting analysis has increaseddramatically,” Krauser pointed out, adding that the timesavingbenefit will come later on. “The reason it is not there yet is thatit is new and we're still learning what to do, so there still is alearning curve.”

Libby Bierman, an analyst for Sageworks, said, “Our bread andbutter at Sageworks has always been commercial loans and businesslending, so the tax packages we support are mostly those commercialproperties that accounting firms used for their businesses. Wesupply our financial institution clients with products that helpthem comply with regulations and improve their efficiency.”

Read more about Sageworks' new Electronic Tax Return Readerin the Sept. 16, 2015 print issue of CU Times.