Tapping into the Amazon business model

What comes to your mind when you think of Amazon? Many view it as a well-established, well-respected company known for its ability to deliver goods at competitive prices.

What started as a bookseller has become one of the most recognized brands worldwide, delivering goods and services to millions of customers.

When I think of Amazon, I think of convenience; I think of reliability; I think of excellent value and wide selection. What makes Amazon so successful are all of these things—and the continuing ability to meet and exceed the expectations of its customers.

Add to that the continuing expansion of Amazon’s offerings—television programming and music services, for example. And then there are the technological innovations, such as drone delivery.

And as you probably know, Amazon ships free and offers two-day delivery (for an annual subscription that includes a number of premium services) of online purchases. It offers price comparisons and rates products by customers who have bought them. That’s not only convenient, it’s transparent.

The Amazon model offers lessons for credit unions that do mortgage lending. To be the best you can be, to continue to grow your market share, you must decide what is important to your customers and excel at delivering it, much as Amazon has done.

Let’s look at the factors in Amazon’s success and how they can apply to your mortgage lending operation.

Convenience. Do you make it easy for your members to get a mortgage loan? You should offer applications in any way they want—online, in person at your branches, over the phone. Then you should set the bar high for service—if they apply online to get back to them within hours not days. If they apply with a branch employee that isn’t a mortgage expert, make sure the loan is reviewed by an expert, again in hours not days.

Reliability. And once the loan is in the pipeline, can you promise a closing date in 45 days, or better yet, 30 days? It takes coordination and persistence (as well as cooperation from the borrower), but it can be done. Successful mortgage departments communicate—internally and with the borrower—every step of the way. Duties are clearly defined, and the MLO and underwriter work together and keep the borrower in the loop, and aware of their responsibilities (especially for providing records) from start to closing.

Value. The price of the loan isn’t the only factor, as the points above should tell you. But nonetheless, it is important to borrowers. (Who wants to pay more than they have to?) Offer competitive rates and promote them. Put them in context, too. Make it clear that you offer more than the package of conventional loans pedaled by your competitors.

Selection. What kinds of mortgage loans do you offer? As we move into a purchase-loan environment, it becomes critical to meet your potential borrowers’ needs by giving them choices. If they can’t qualify for a conventional 30- or 15-year loan, give them some alternatives that they can afford. Especially for first-time homebuyers: Work with them; show them you are willing to help them reach the dream of home ownership.

Together, these four factors can bring you success. But it takes work and commitment—and an investment in both timer and money.

So talk with your peers. Find out how the successful lending programs got there and how they plan to stay ahead. Attend credit-union industry events and soak up knowledge from the experts. Partner in your community with Realtors. Do your homework and build a network of other lending professionals for support and advice.

The sooner you can accelerate your mortgage program, the better your chances for being a leader in your market.