FOND DU LAC, Wis. – This article was originally published on CUtoday.info.
Credit union leaders have a lot on their plate, from growing membership to streamlining operations and increasing profitability, while navigating an evolving marketplace made more complex by factors such as increased regulatory scrutiny, the digitization of lending services, and the need to resonate with millennials.
Of the various everyday operations that require attention at a credit union, real estate tax monitoring and escrow processing are paramount functions but also ones with established best practices. To ensure these functions perform at the highest level without using valuable resources that could be better utilized elsewhere to address key strategic initiatives, credit unions of all sizes choose to outsource these services. In this article, I’ll explain the benefits of outsourcing, and what to look for in a vendor.
Outsourcing real estate tax monitoring and escrow processing services at your credit union offers many benefits. Here are a few of the main ones:
- Save Money and Boost Profitability: Some credit unions avoid outsourcing because they worry about costs. However, when outsourcing real estate tax monitoring, the credit union only pays for their existing portfolio, and other nominal fees are passed to the member. Plus, credit unions can actually increase profitability through outsourcing by focusing resources on creating new loans.
- Save Time and Reallocate Resources: Credit unions can save immense amounts of time that would have been spent by employees managing these tasks and working with regulators. After outsourcing, the credit union can then reallocate those resources to other areas of the institution to focus on growth and customer service.
- Mitigate Risk: Working with a high-quality vendor gives credit union leaders peace of mind that their portfolio taxes are up-to-date. Additionally, outsourcing helps a credit union of any size expand regionally or nationally, without needing to learn new state-specific regulations or train employees on new processes.
What To Look For In A Vendor
Not all real estate tax monitoring and escrow processing vendors are created equal. Here are a few important qualities to consider when shopping for a vendor:
- Customizable: Choose a vendor that works collaboratively with you and offers solutions tailored to your needs rather than a blanket offering. Specifically for escrow processing, look for a provider that offers multiple options for escrow payments and takes into consideration what is most functional for both you and your borrowers.
- Exceptional Reporting: Look for a vendor that offers online access to data in real-time, electronic and on-demand reports, and custom reporting offerings depending on your preferences.
- Accuracy: Accuracy may seem like a given for outsourcing these services, but unfortunately not all vendors offer the same quality of service. Vet potential vendors and ask for customer references to ensure you are getting high-quality service.
- Great Customer Service: You want to find a vendor who prioritizes customer satisfaction and communication. Inquire with potential vendors regarding their net promoter scores and employee engagement levels, for any outsourcing partner is an extension of your credit union.
By Chad Raube, President and CEO of Info-Pro Lender Services