The banks and credit unions that offer manufactured home loans know that the overhead costs and risks involved in originating and servicing these financing solutions are often hidden, but can be substantial.
The secret to reducing costs and minimizing risks consists in transforming your operating model. Although every financial institution’s approach will differ, below are several ideas you can implement to achieve your institution’s goals.
Outsourcing your manufactured home loan services is a smart way to lower operational and labor costs, while helping your employees feel less overwhelmed and be more productive.
By outsourcing applicant screening, loan processing and settlement, customer communication, payment collection, cash management and loan portfolio performance monitoring to an experienced loan origination and servicing company, like Triad Financial Services, your institution will benefit from standardized end-to-end processes, consolidated resources and a significant reduction in loan origination cycle time.
Besides allowing your institution to offer manufactured home loans with fewer drawbacks, outsourcing makes it possible to devote more time and attention to core competencies, such as revenue-generating activities, investment management and customer service.
For a financial institution to offer manufactured home loans, it needs to add new asset classes to its portfolio. On the downside, each additional asset class brings along a series of risks that might manifest themselves under certain circumstances, requiring more conscious efforts to mitigate them.
In general, there are three main categories of risks a manufactured home lender might face.
Although the FHFA’s new “Duty to Serve” rule establishes a supportive environment for the lenders who intend to offer manufactured home loans, a favorable environment isn’t enough for a loan portfolio to evolve positively.
In a previous article, we showed that one way to reduce the risks inherent in loan portfolios is to implement the right diversification strategies. However, cautious lenders usually consider another essential point; namely, risk sharing.
Therefore, one of the best ways to reduce and even eliminate certain loan portfolio risks is to select a responsible and reputable partner who provides low-risk, high-yield investment opportunities and has all the “tools” necessary to help you improve your risk assessment and management skills. As an example, Triad Financial Services can assist you in addressing your loan portfolio risks, including the risk of default, by:
Unlike other lenders who offer manufactured home loans, Triad Financial Services provides a full range of products and services along with in-depth industry expertise and unparalleled outsourcing capabilities. By partnering with us, your organization can use all these to right-size its operations, maximize profit margins and deliver first-class service to all of its customers.