Local Government Federal Credit Union | Paper Files and Manual Data Entry

The Challenge: Paper Files and Manual Data Entry

Local Government Federal Credit Union (LGFCU) is known for its commitment to serving its members in North Carolina, especially through the credit union’s nonprofit lending program. Over the past few years, however, LGFCU came to realize their credit and lending processes were not optimized for efficiency or member experience. All processes supporting the life of the loan were manual. Lenders and management wasted time tracking down and organizing documents and spreadsheets since multiple staffers were involved. Data had to be repeatedly entered, and tracking loans through the pipeline required telephone tag and emails to colleagues. Of even more concern to the credit union was the member experience: borrowers were required to mail, physically deliver or email (with accompanying security, risks) documents, and they waited up to a full week to hear back on a loan decision. 

What was of even more concern to the credit union than the time wasted on moving and tracking loans through the pipeline was the member experience they were delivering—with borrowing members being required to search for documents and mail them in, physically deliver them, or run the security risk of emailing them, as well as waiting up to a full week to hear back on a loan decision.

We wanted a partner, not one that was going to be here today or tomorrow, but with us for the long-term. We looked for someone that would be able to build with us, that saw our vision for the future.
Neal Chaloupka, LGFCU

The Solution:

The primary goal of LGFCU’s project was to digitize and streamline the credit union’s member business lending processes—the entire life of the loan—in order to create significant gains in efficiency as well as improve the borrower experience. “The goal was not just a solution to make this easier for us but a solution for our members,” said Neal Chaloupka, Vice President of Lending at Local Government FCU. LGFCU set out to find a provider that not only offered the desired solutions, but also one that was known for extensive support and customer service offerings and that would continue to innovate alongside them. “We wanted a partner, not one that was going to be here today or tomorrow, but with us for the long-term,” Chaloupka said. “We looked for someone that would be able to build with us, that saw our vision for the future.”

At the time, Abrigo did not offer spreading software for nonprofit lending, which was the focus LGFCU required. However, LGFCU advised Abrigo's product team on the development of a new module specifically for nonprofits, which went live in 2016. LGFCU moved to centralized underwriting when they brought in a new credit manager, and the team committed to a project timeline to fully automate its lending process in spring of 2017, bringing in Abrigo modules to automate workflow, risk rating, loan decisioning and relationship management. 

The Result: "Tremendous" Time Savings for Staff & Members

LGFCU’s technology implementation and structural changes allowed the credit union to take on more lending, make better use of employees’ time and better serve its members.

Significant efficiencies have been created through the seamless workflow and improved internal organization. “Time savings with the process has been tremendous,” commented Chaloupka, “With our set up before, some of these [loans] could take five or six days… Our turnaround time with the full solution up and running is probably one to two days max.”

Loan officers save time thanks to the automation from Sageworks, giving them bandwidth for more valuable activities like prospecting or face time with members. The software and process overhaul also led to a significant reduction of internal meetings for approvals. Many of the large loans LGFCU processes used to go to a committee—requiring repetitive effort to get six people together in a room for a decision. “Our goal was to get rid of these entirely, and with the technology we have not had the credit meeting to that extent in a year,” Chaloupka said. Rather, the technology and documentation created in Sageworks clearly shows a loan’s financial ratios and their alignment with the credit union’s loan policy. Overall, LGFCU has been enabled to do more lending, closing loans at faster rates than before while adding volume to the credit union’s portfolio.

The outcome LGFCU is most excited about is the benefit to its members. LGFCU now offers members simplified, digital approaches to taking out a loan as well as the traditional, more personal process they continue to offer members. The Loan Application from Abrigo is a quick, intuitive channel for members submitting an application, and automatic emails and reminders are sent to members throughout the process. Client Portal offers them secure, one-click uploads of necessary documents rather than requiring mailing or drop-offs.

It’s about the members, and the members need an answer. For us, many times, these are volunteers, firefighters throughout the state. We need to serve them and get them fast answers in the same way they are serving and protecting us.
Neal Chaloupka, LGFCU
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