Seven Seventeen Credit Union Triples Refis

The Ohio-based credit union encourages members to "simplify and save" and scores stellar refinancing growth in the second half of 2011.

 
 

Seven Seventeen Credit Union ($775.7M, Warren, OH) wanted a way to help members save money, simplify their finances, and plan for a healthy financial future. To do this, is created “Simplify & Save,” an initiative that takes the transaction friction out of refinancing and debt consolidation. When the credit union launched Simplify & Save on August 1, 2011, it wanted to save its members $1 million by the end of the year. The credit union hit that goal in less than seven weeks.

On September 19, 2011, Seven Seventeen launched round two of Simplify & Save. This time, its goal is to save members an additional $5 million in 2012. As of January 27, 2012, the credit union has saved its members a total of $4.25 million. Approximately 70% of the Simplify & Save activity is in mortgage refinancing, that’s a lot of overhead savings.

Here, Eric Lanham, senior vice president of marketing at Seven Seventeen Credit Union, talks about Simplify & Save.

What problem are you addressing with Simplify & Save?

Eric Lanham: We had two objectives tied together with Simplify & Save.

First, our market has been hit particularly hard the past couple of years. Unemployment exceeds national and state averages, and members are struggling to make ends meet. So we were looking at how to package the credit union’s resources  — such as our BALANCE Financial Fitness and FinanceWorks  — in a more comprehensive tool.

Second, we wanted to improve loan demand. We were already working with refinancing, modification, and loan consolidation, and we realized there was an opportunity to put together a program that simplified finances, encouraged financial education, and saved members money.

How did you arrive at the concept of Simplify & Save?

EL: We had a lot of these resources already available. We were doing refis, modifications, and debt consolidation. We have financial education. We realized we needed to pull it all together and communicate it as a packaged program.

How did you implement Simplify & Save?

EL: For the financial education part, we developed a printed booklet that includes a budget worksheet, budgeting articles, and information on how to better understand credit. It also outlines what resources are available through the credit union and community, such as where to get assistance for housing, food, clothing, or utilities. A second piece is the Simplify & Save microsite. It contains information from the booklet as well as additional resources, such as direct access to BALANCE.

We also brought together the credit union’s marketing and lending leadership. They started working on a weekly basis to make sure our efforts were aligned, which brought strength to our lending initiatives.

How do you promote Simplify & Save?

EL: We promote Simplify & Save through a variety of means, including through our website, emails, newsletter, branches, and print ads.

How are you measuring success?

EL: We look at what we are able to save members in terms of dollars and new dollars we are bringing into the credit union. The financial education piece and its impact on membership is harder to track, but the responses we’ve gotten back from members have been positive.

Tell me about the results?

EL: We’ve saved 616 members $5.2 million in interest savings and have received more than $25 million in loans refinanced from other financial institutions. That’s new business for the credit union.

We've refinanced 176 mortgages with an average savings of $23,500 over the life of the loan. We've also refinanced 405 other consumer loans with an average savings of nearly $7,000.

We’ve seen savings of up to $40,000 over the life of an individual loan, but the average overall savings is in the realm of $12,000-$14,000. Weekly, we’re saving our members on average $222,000.

And how much of the Simplify & Save activity is in mortgages?

EL: Probably 70% is mortgage refinances. Our refis have gone through the roof. Volume on mortgage refinances has more than tripled in the second half of 2011 compared to the first half.

Do you offer an incentive?

EL: We talked about offering a member incentive to come in, but the initial response was so phenomenal we didn’t feel there was a need for the credit union to take on that expense. The program is still going like gangbusters without the incentive.

We have an employee incentive of $25 that comes from a weekly drawing of everyone that has saved members money.

Do you see this activity continuing?

EL: Yes. Word has gotten out about Simplify & Save, which has helped bring in new business. Word of mouth is generating goodwill in members and the broader community.

So what’s next for Simplify & Save?

EL: We are in the beginning stages of putting together a Simplify & Save seminar series where financial professionals will be on hand to answer questions about credit and finance management.

 

 

 

Feb. 6, 2012


Comments

 
 
 
  • Good program but are those long term fixed rate re-fi's?
    david proffitt
     
     
     
  • What an amazng and impressive success story! This is the kind of role that Credit Unions should be taking to truly help members.
    Linda LaCrosse
     
     
     
  • this is a dyanmite article. Every public official and member of congress should see this. Don't have to pass new programs, just put credit unions to work on helping consumers lower their rates!

    The numbers tell the story.
    Anonymous
     
     
     
  • Great job Seven Seventeen. We are working on establishig a savings goal for the year to announce at our annual meeting at the end of March. This is very helpful. Since you have created so much material, are you willing to share some so we don't need to reinvent the wheel? Thanks, DDD
    Dennis D. Degenhardt
     
     
     
  • Great questions. I reached out to Eric Lanham for clarification, and he provided the following answers:

    1. The vast majority of mortgage refis have been traditional, fixed-rate loans. Looking at terms less than versus more than 15 years, it is about an even split.

    2. The credit union packaged together existing products and services, so there is nothing it had to change relative to reporting practices.

    Rebecca Wessler
     
     
     
  • Are these loans reported as modified on the Call Report?
    Kevin Zimmer
     
     
     
  • How do you calculate the member savings?
    Jeanna