Disruptive lending platform puts credit unions in competitive position to dominate local markets

Fintech startup LenderClose today announced it has secured the funding it needs to add 25 employees to the fast-growing company. A credit union service organization (CUSO), LenderClose launched in 2016 when lending technology pioneer Omar Jordan saw an opportunity to upend the underwriting process.

Since its launch in March 2016, LenderClose has added 100 lenders to its client list. February 2018 marked a record month of revenue for the startup, followed by another record month in March. That same month, the startup became a CUSO with direct investment from two Iowa credit unions, Collins Community Credit Union and Serve Credit Union. It also added two key executives to its team: Chief Operating Officer Ben Rempe and Vice President of Business Development Brian Storey. The pair brings a combined 30 years of financial services experience to LenderClose.

LenderClose’s latest round of funding was led by Next Level Ventures, which is a venture capital firm that invests in growing companies based in Iowa. Its portfolio includes fintech firm Dwolla, which also counts credit unions and CUSOs among its early investors.

“This team has done some pretty impressive things with limited resources,” said Scott Hoekman, co-founder and principal of Next Level Ventures. “This investment is gas in the tank that will allow LenderClose to do much more. LenderClose has a product that works, clients who have validated the solution and a growing team supporting the vision for rapid scale. You put more money alongside that momentum, and you’ve got something pretty exciting.”

“The digital transformation of the credit union industry hinges on the availability of technology that streamlines all those behind-the-scenes processes that can get in the way of exceptional member service,” said Scott Frost, chief lending officer of Collins Community Credit Union. “Megabanks see the opportunity, too, and are snatching up fintechs and digital platforms, vertically integrating them in a way that makes them completely inaccessible to community lenders. Because we are a part of a collaborative movement, we feel a calling to help make this technology accessible to as many other community lenders as possible. That’s why we’ve chosen to invest in, support and advocate for LenderClose, which we see as a digital game changer for community lenders.”

The LenderClose platform is a loan officer’s digital hub. With API connections to every vendor it takes to originate a mortgage or HELOC, LenderClose gives credit unions immediate access to a comprehensive suite of reports and services – from credit scores and flood determinations to notary signing and county recorder services. The result is a streamlined and vastly accelerated underwriting process, which is, according to Jordan, an increasingly essential capability for credit unions.

“Borrowers have always wanted a fast ‘yes’ from lenders,” said Jordan, who consistently led the nation in mortgage originations while serving as AVP, sales branch manager for Household Finance, now HSBC. He has since built and sold two lending technologies companies. “But that demand for urgency has been cranked to 11 today.”

Rempe added, “Consumers are used to getting what they want, how they want it, right now. Starbucks has your custom-ordered coffee ready before you even get there; Indochino has a made-to-measure suit on your doorstep in a couple days. Lenders understand expectations are changing, and they want to give borrowers that ‘yes’ right away. But, they have massive checklists that have to be addressed first. The LenderClose platform helps loan officers drive through the checklist, so they can deliver ‘yes’ faster than ever before.”

A positive and fast borrower experience is critical as market pressures increase. In Fannie Mae’s Q1 2018 Mortgage Lender Sentiment Survey, “competition from other lenders” set a new survey high for the fifth consecutive quarter as the key reason cited for lenders’ lower profit margin outlook.

Credit unions that have added LenderClose to their lending programs report significant improvements in their operations. Some even credit the platform with launching entirely new products for their institution’s lending effort.

“Our home equity program was essentially nonexistent prior to joining LenderClose,” said Billy Hernandez, chief lending officer of California Bear Credit Union. “Our core system wasn’t set up to take on home loan applications, and we were getting frustrated trying to satisfy a growing demand for these products from our members. Since adding LenderClose, we’ve had a tremendous amount of success with our home equity program. We’ve even hired a loan officer to keep up with the demand.”

Credit union leaders can see LenderClose up close at the NACUSO Network Conference on April 18 in Anaheim, Calif. Jordan and Rempe will demonstrate the platform to attendees of the event’s 2018 Next Big Idea Competition.

About LenderClose, Inc.

LenderClose is a powerful platform that digitizes the underwriting process and speeds up the lending cycle. The web-based hub gives loan officers instant access to the latest real estate lending technology, products and solutions so they can become dominant lenders in their local markets. To learn more, follow LenderClose on LinkedIn or at lenderclose.com. 

CO-OP Financial Services is announcing a patronage (shareholder dividend) pool of $30.5 million for fiscal year 2017, raising to $426.8 million the total patronage amount made available by CO-OP since becoming a cooperative in 1996.

“CO-OP made a tremendous investment in technology infrastructure and product innovation in 2017, in addition to acquiring TMG,” said Todd Clark, President/CEO of CO-OP. “The result is a strategic focus on offering solutions that deliver a personalized, seamless and secure experience for members to engage with their credit union. This vision was realized through the hard work of a new, dedicated and diverse leadership team from the two legacy companies and new hires as well. Our year of transformation was also a well-balanced one, enabling us to report a strong patronage to our 1,200 shareholding credit unions.”

Recent highlights among CO-OP’s activities reflect the company’s strategic priorities of client centricity, digital enablement and access, leveraging data intelligence and continuous improvement:

• CO-OP unveiled MyCO-OP, a new client portal that provides credit unions with secure, universal access to CO-OP applications through a single, highly intuitive user interface. The launching point for all things CO-OP, it dramatically simplifies the way clients access and use CO-OP applications.
• CO-OP established a new annual record by processing more than 6.6 billion credit, debit, electronic funds transfer (EFT) and shared branch transactions in 2017 – doubling 2016’s figure of 3.3 billion transactions. 
• The company launched its client Co-Creation Councils, designed to give credit union leaders an active role in shaping the future of payments and provide a tangible platform for collaborating on shared business issues.
• A new mobile locator app for the CO-OP ATM and CO-OP Shared Branch networks were launched, as well as Mobile Banking 3.0, offering advanced new features to CO-OP mobile banking product line.
• CO-OP became one of the first to support wearable payments solutions by Garmin and Fitbit.
• CO-OP Shared Branch emerged as the second largest network of financial services branches in the country, now totaling more than 5,700 locations.

The Annual Meeting of CO-OP Shareholders will be held during the THINK 18 Conference in Chandler, Arizona. The meeting will take place at 12:30 p.m. local time on Wednesday, May 9. To register immediately for the THINK 18 Conference, visit www.co-opthink.org.