Patelco Credit Union Automates Home Loan Tasks so Humans Can Care for Members

With the increased demand for new home loans and refinancing, Patelco Credit Union recognized an opportunity to improve efficiencies in its loan processing department. With support from Digital Align Inc, and automating 35 loan processes, Patelco increased loan application speed and loan quality to allow team members more time to focus on its personalized, member service.

Home Loan Pricing and System Administration Manager at Patelco, L.J. Grossweiler, explained, "we were seeing longer processing times for home loans and it was clearly time to start automating loan processing so our team members could focus on working with members."

"As a credit union dedicated to the financial health and wellbeing of our members, creating personal connections is really important to us," she said. "We want our team members to focus on members, not the process."

Like many other credit unions, Patelco has a complex loan origination system that requires multiple manual steps to process the loan application. To start automating the home loan process, Patelco needed help from a technology partner. They needed someone that understood their challenges, who understood the credit union business and systems, including how to integrate with their legacy loan system. That's when they approached Digital Align.

Let the humans take care of the members and the bots take care of the task.

L.J. Grossweiler • Home Loan Pricing and Systems Administration Manager, Patelco

A Proven Track Record in Loan Automation

Digital Align are experts in automating credit union and banking processes using UiPath robotic process automation (RPA) and other tools. The company's founders have a background in automating systems for credit unions. Rajesh Patil, CEO of Digital Align, worked with First Tech Federal Credit Union, one of the largest credit unions in the bay area, for five years and led their digital transformation initiative before starting Digital Align. Today, he specializes in digital transformation for community banks and credit unions, including automating legacy systems. In 2020, Digital Align worked with Gesa Credit Union in Oregon to automate their loan processing system. Rather than hiring additional processors and underwriters, Gesa tasked Digital Align to find another way to handle the increase in loan volume. Within six months they had implemented 30 processes to automate the end-to-end mortgage process. The result was growth from two-fold to five-fold in loan volume without adding staff.

Looking to replicate that level of success, Patelco engaged Digital Align to automate their home loan process, since Digital Align understood the pain points. The first step for Digital Align was a discovery process, which took four to six weeks. The Digital Align team interviewed everyone involved in the loan process to determine what processes could be automated. By the eighth week, the Digital Align team had presented 35 automated loan processes that would save time and allow Patelco to increase loan volume.                

Digital Align is always sensitive to the fact that a team member will need enough time to trust the bots to perform the manual tasks on their behalf. Our unique approach of rolling out the on-demand processes to staff members made the staff feel in control during the initial phases and once they gained confidence in the bots, which made it easy to fully automate the processes. This approach strengthened the trust of the staff.

Denise Cadwall • Mortgage and Consumer Lending SME, Digital Align

Automating Data Entry

The initial RPA processes included routine tasks that are part of home loan processing, such as ordering titles and filling in title information. They also automated ordering appraisals and making sure that all the data is complete. This included information such as the year they home was built, total square footage, number of bedrooms, and other points. It also includes making sure that the loan applicant gets a copy of the appraisal. Bots also handle the loan checklist to be sure that all the required paperwork is processed. 

The RPA bots also are responsible for validating loan paperwork with third party services, such as fraud detection. For example, an automated process uploads the paperwork to a fraud detection service, scans for fraud alerts, and delivers the results. Removing these types of manual data entry processes is a huge time saver for Patelco loan team members.

"The heaviest lift is the data entry and that is something the bots can definitely do for us," said Grossweiler. "We have a lot of talented people in our group, and we don't want them doing data entry when we can engage in more valuable services for our members and the credit union."

Following the first automation phase, the Patelco loan management team plans to automate additional steps in the loan process, such as calculating income. 

"Reading documents is always a challenge," said Denise Cadwell, Mortgage and Consumer Lending SME for Digital Align. "While Tax returns and W2 Statements are standardized, and our OCR engine is able to read those, but when it comes to reading insurance documents and paystubs we will require intelligent automation because there are so many variations but Digital Align has figured out ways to read and validate such documents using OCR technology."

"Successfully implementing and deploying 35+ processes in just 5 months was not an easy task," said Lakshmi Parameshwaran, Head of Delivery at Digital Align Inc. "The three main contributors for this success are people - collaboration between Patelco Credit Union and the Digital Align technical team, process - detailed documentation and iterative approach of delivering processes every sprint, and product - implementing automation on UiPath, the best in class RPA platform."

Freeing Staff Time to Better Serve Members

Even with the time-saving benefits of RPA, Digital Align still sees some resistance to loan automation. Initially, team members have insisted on continuing to use manual data entry processes. Demonstrating the amount of time and effort saved with RPA has been a key factor in adoption. As Patil explains, "you must show employees how much effort that save with automation and reassure team members they control the process."

Patil advises anyone adopting RPA to focus on building bots that deliver immediate value rather than starting with a center of excellence. He says anyone considering RPA for applications like loan processing must consider four areas-capacity to handle loan volume—the quality of the data for compliance, staff productivity and throughput, and processing speed for member experience. 

"Once you take those processes and improve these four areas, you will see more efficiency and the staff using their time in a more valuable way," Patil said. "You won't have to hire new people to do the same job and you will automatically see value."

For Patelco, the value of automation lies in the improved service the credit union provides to members. Automating loan applications not only shortens the time to approval, but also allows the Patelco team to work more closely with its members.

"Let the humans take care of the members and the bots take care of the task," Grossweiler said.

You must show employees how much effort they save with automation and reassure team members they control the process.

Rajesh Patil • CEO, Digital Align