With mortgages being a vital part of business for many CUs, remote online notarizations are a great place to start.
Credit unions pride themselves on providing outstanding customer service, and these days, that means offering online convenience so members can open accounts, pay bills and get cash without coming into a branch office.
When signing important documents, including personal loans and mortgages, members also expect a seamless and convenient process that meets them where they live – online.
Understanding Your Current and Future Members
A common misbelief among financial institutions is that digital technology needs to be tailored to younger consumers. However, 90% of consumers prefer to manage their finances online, including monitoring account balances, mobile check deposits and applying for a mortgage, according to a 2023 Chase survey.
In the near future, Generation Z (ages 18-25) will be the largest cohort of consumers, and they are not afraid to switch financial institutions in the pursuit of exceptional service. Additionally, many have already begun increasing their interactions with their financial institution, both in number and type of interaction, expanding the breadth of their customer service experience.
However, financial institutions that don’t live up to expectations aren’t likely to get a second (or third or fourth) chance just because the consumer doesn’t want to deal with the hassle of finding a new financial institution. Digital options are especially important to all buyers, and those credit unions unable to accommodate these preferred interaction methods risk losing their business.
Moving Business Online
As consumers of all ages are reliant on digital banking tools, credit unions should increase their focus on providing an experience that both incentivizes current members to stay members and attracts new members. In fact, among financial institutions that have completed more than three-fourths of their digital transformation strategy, 29% report an improvement in customer/member retention, according to Cornerstone Advisors. That means giving them an experience they’ll appreciate and recommend, i.e., a digital experience encompassing every aspect of their financial lives.
That includes ensuring the website meets their needs and offering Amazon-like convenience when transacting business. Remote online notarizations (RON) can be an easy place to start for credit unions that haven’t already begun a digital transition process and can be utilized for many member transactions. Since mortgages are a vital part of a credit union’s revenue stream, the mortgage process should be one of the first looked at when modernizing the member experience.
Remote Mortgage Closings With RON
In the U.S. real estate/mortgage industry, nearly all transactions require the service of a licensed professional notary. In the past, this was a time-consuming and cumbersome process for all parties involved. The mortgage industry as a whole is looking at digitizing parts, if not the whole, mortgage process to increase convenience, speed, cost and more.
RON is a vital function during the digital closing process and retains all the core components of a traditional, paper-based notarization while providing many safeguards to ensure the integrity of each notarization, including multi-facet identity verification. Currently, one in seven lenders perform some sort of digital closing, and 41% of lenders plan to implement e-closing technology this year, according to Celent.
Best of all, RON doesn’t require lenders to change many of their existing processes and can reduce the time spent on each loan, improve accuracy and simplify communications between buyers and closing teams. Plus, with all the loan documents online, closing agents can perform their QC throughout the process to save time down the road and improve the quality of the transaction.
Using RON for Servicing and Loss Mitigation
For many people, one of the more impactful aspects of being a credit union member is knowing that they are more than just another account number and seeing that reflected in their experiences. It’s extremely common for credit unions to manage their consumer loan portfolio in-house and they choose to do the same for their members’ mortgage loans. Loan servicing, including loss mitigation, is another opportunity to strengthen member relationships and improve the member experience with digital offerings.
Fannie Mae and Freddie Mac allow servicers to leverage e-sign technology for loss mitigation transactions. By enabling mortgage servicers to leverage technology to support at-risk homeowners, the government-sponsored enterprises have made it easier for borrowers to utilize loss mitigation solutions quickly and conveniently, negating the need for servicers to print, mark up and ship the package.
With RON, servicers can deliver a user-friendly digital package online that’s ready to be e-signed, reducing the average turnaround time to seven days and addressing errors quickly and efficiently.
Additional Uses for RON
RON also has the potential to improve member experience across all services, not just mortgages. RON can also be utilized for any transaction that requires notarization, including financial statements and consumer and student loans, expanding the areas in which RON benefits credit unions and their members. Additionally, credit union members located in less populated areas benefit significantly from the ability to notarize documents online rather than drive long distances in search of a notary.
For credit unions located in or near college towns, the ability to notarize student loan documents remotely is highly beneficial for conducting closings with international signers, students on break and those studying abroad, and times when a cosigner is needed but not conveniently located.
Transforming Your Business for the 21st Century
Bringing member services into the modern world doesn’t mean credit unions must forego in-person services but rather expand their ability to meet members where they are, whether in-person or online. After all, the personal element is one of the benchmarks of credit union membership, and there are still some tasks that can’t be done online, like notarizing a marriage license.
Still, credit unions should constantly review and upgrade their digital member service offerings to broaden their appeal, and attract and retain members. By serving as a trusted source offering members ample digital capabilities and unparalleled convenience, credit unions effortlessly build relationships and earn member loyalty through all seasons of life.
Credit unions should be on the frontlines of using secure online tools like RON to help members complete transactions in ways they’ll appreciate and remember favorably, ensuring they remain members for years to come.
Read the original article posted on the Credit Union Times.