With the rise of technology and the expansion of financial regulation, more nonbank lenders are competing than ever before. What can traditional FIs learn from them and what can they do to compete? Check out MBA Insights to find out: https://www.mba.org/publications/insights/articles/featured-article/lessons-bank-and-nonbank-lenders-can-learn-from-each-other
Traditional and alternative lenders play by different rules, but each have their own advantages. Check out @cunacouncils to find out what your #creditunion could learn from nonbank lenders and what they could be learning from you: http://www.cunacouncils.org/news/16201/news-article/
“Commercial mortgage companies that fail to implement mobile solutions also run the risk of losing step with their clients and falling behind their competitors” says our president Matt Johnner. Read more of what he has to say about mobile tools in lending in this month’s issue of Scotsman Guide: https://www.scotsmanguide.com/Commercial/Articles/2019/07/Mobile-Lending-is-the-Next-Wave/
We’re proud to work with credit unions like SRPFCU that prioritize taking care of members . Check out the latest episode of CUBroadcast to hear firsthand from Will Scott of SRP about his experience working with us and how his credit union has been able to grow: https://www.cubroadcast.com/episodes/1107-how-srp-fcu-has-used-banklabs-commercial-lending-technology-to-help-the-credit-union-grow
“Despite their size, industries like #construction are largely underserved by financial institutions, especially when it comes to mobile options for #payments.” See more of what @MattJohnner has to say in @payments_source: https://www.paymentssource.com/opinion/mobile-payment-apps-cant-serve-only-consumers
By Matt Johnner
Construction lending is a growing sector of the mortgage industry and one that has traditionally been dominated by big banks. Recently however, these big banks are taking a more conservative approach on construction loans, creating opportunities for smaller, community-focused banks to seize the steady flow of capital.
While big banks are choosing to limit exposure by focusing more on existing customers, other financial institutions can jump in to fill the void. Of course, this means that the competition between small and mid-level banks focused on construction lending is reaching an all-time high.
So, how can a financial institution differentiate itself in such a competitive market? The answer is by offering solutions that automate the entire construction loan process, making life easier for all parties involved.
As featured in American Banker.
As construction lending starts to make a comeback, many community banks relying on lending to developers and builders are looking to use cutting-edge digital interfaces to help them attract more clients.
“It’s important for us to create convenience not only for our clients but for their clients as well [such as subcontractors] and give them quicker and more convenient access to funds,” said David Veurink, chief credit officer and head of commercial banking at Chicago-based Countryside Bank.
BankLabs, a national provider of innovative mobile technology products for community banks, today announced the 50th bank to go-live with Construct, the cloud-based construction loan management product for lenders and their borrowers, builders and inspectors.
“In today’s technology-driven world, we wanted to provide an easy-to-use, web-based service to take the place of cumbersome spreadsheets and paper files. The importance of mobility continues to grow to differentiate the financial institution.”
Construct is a banker-centric, web-based service that automates the post-close administration of construction loans for lenders. Accessible from any phone, tablet or computer, it eliminates the need for paper files and spreadsheets, increases bank productivity, mitigates the risk of overfunding projects and improves the experience for both the builder and borrower.
Using Construct, a builder is able to view available funds via computer or mobile device and submit a draw request. Notifications are then sent via text or email to the inspector, borrower and bank personnel. The inspector takes pictures, enters notes and updates the percent complete via phone or tablet. Without the need for spreadsheets, the correct draw amount is automatically calculated and can be instantly viewed by the banker, borrower and builder along with inspection details, documents and photos. Reports are then automatically generated based on real-time data.
Construct has proven to reduce loan administration time by 50 percent, lower inspection costs, identify and mitigate potential risks and enhance the borrower/builder relationship through mobile access. Financial institutions using Construct have already seen an eight to 12 percent draw interest improvement, as well as a decrease in cycle time from days or weeks to minutes.
“Construct completely automates the traditionally manual loan administration, inspection and draw process, making life easier for the bank, builder and borrower using real-time workflow and proactive next step tracking,” said Matt Johnner, president and co-founder of BankLabs. “In today’s technology-driven world, we wanted to provide an easy-to-use, web-based service to take the place of cumbersome spreadsheets and paper files. The importance of mobility continues to grow to differentiate the financial institution.”
BankLabs is a national provider of innovative mobile technology products that help community banks improve efficiency, increase time for relationships with customers and create marketplace options that expand business opportunities. BankLabs believes that community banking is a way of doing business, not a size. For more information, visit banklabsstaging.mystagingwebsite.com.
Catherine Mootz, 678-781-7227
Sarbanes-Oxley mandates improving risk management and making operations more effective and efficient
Does your construction lending department manage its construction loan activities using spreadsheets? Has your bank unintentionally over-funded any construction loans? Has it been a while since you assessed the effectiveness and efficiency of your construction loan administration?
As a board member, audit committee member, or member of the internal audit group, if you answered “yes” to any of these questions, are you feeling uneasy? Well, you should be.
By now, everyone in banking considers Sarbanes-Oxley to be old news. After all, it’s been around since 2002, and virtually every bank has beefed up its internal audit capabilities to bring the bank into SOX compliance. What is not so obvious is that Sarbanes-Oxley standards also require that the bank’s internal audit activity evaluate and contribute to the improvement of the organization’s risk management, control, and governance processes. And, internal audit activities must be designed to provide reasonable assurance regarding the “effectiveness and efficiency of operations”.
As featured in American Banker.
Lending to developers and builders is community bankers’ bailiwick … and sometimes their bane.
In good times construction lending keeps community banks thriving, but the financial crisis of 2008 brought down hundreds of small banks because they were heavily exposed to commercial real estate.
Perhaps there is a tech solution to avoid or soften the bad times, some fintech vendors say. Granted, no software can prevent real estate downturns, but construction lenders’ reliance on spreadsheets, file folders and sticky notes is said to add hazards. Their platforms, the vendors say, can streamline the process and make it safer.