Webinar recap: How high-performing credit unions are transforming loan origination

As lending volumes, member expectations, and competitive pressures continue to rise, credit unions are rethinking how their loan origination systems (LOS) can support both growth and resilience. In this recent webinar, industry experts and credit union leaders explored how high-performing organizations are modernizing loan origination—without losing sight of risk management, compliance, or the member experience.

Panelists shared practical guidance on future-proofing lending operations, emphasizing the need to balance scalability with efficiency while delivering fast, intuitive, and consistent experiences across channels. The discussion covered best practices, emerging industry standards, and real-world lessons learned from credit unions actively adopting automation and intelligent decisioning.

Lending automation is no longer optional 

Lending automation has moved well beyond experimentation. A survey of webinar participants showed many credit unions are actively evaluating LOS options or engaging in vendor selection, along with a smaller, growing group that are actively implementing or have gone live.

Daryl Jones, senior director at Cornerstone Advisors, suggests that credit unions that have moved more cautiously may not be as far behind as they think. The opportunity isn’t about how fast you moved in the past, but about what you do next. Automation can deliver immediate value while creating a foundation for future innovation.

Where automation delivers early wins 

Jones identified two areas where credit unions typically see the fastest impact from LOS automation: 

• Point of sale (POS): POS solutions directly shape the member experience and often receive the most attention. To be effective, they must support intuitive, member-centric interactions, align with the credit union’s brand enterprise-wide, and still allow operational flexibility and management oversight. 

• Automated decisioning: Credit unions are encouraged to take a measured approach. Rather than chasing overly ambitious promises, many institutions successfully achieve 30–50% automated approvals early on. From there, performance improves through continuous testing, tuning, and measurement, carefully balancing growth with risk and compliance requirements.

Improvements in member satisfaction should go hand-in-hand with operational efficiency. Faster decisions and cleaner workflows benefit both sides of the lending equation.

Designing for the future, not automating the past 

Lending leaders are encouraged to think beyond what automation can do for them today without losing sight of future possibilities. While addressing pain points is a natural starting point, Jones cautioned against simply replicating legacy processes in a new system. The most successful credit unions design toward a future-state vision.

Longer term objectives for automation beyond decisioning include document management, intelligent OCR, stipulation clearing, and AI loan file processing with exception-only staff involvement. Even as automation expands, Jones emphasized that two areas will always require human expertise: managing loan exceptions and guiding strategic planning.

Avoiding common pitfalls in LOS transformation 

One of the biggest mistakes credit unions make when converting to automated loan systems is to move a bad process into the new system. Conversely, credit unions are encouraged to consider what they don’t want to lose from their current process. Integration complexity is often underestimated, and early design decisions have long-lasting consequences. Jones advised credit unions to avoid both extremes: rushing implementation without sufficient planning or falling into analysis paralysis by over-engineering every detail.

Choose a partner, not just a product

A few credit unions may meet the size and scale thresholds needed to grow their own system, but many will choose a provider to deliver technology. In this regard, both panelists made a distinction between buying vendor products and ongoing partnerships with a strong preference for the latter. Strong strategic plan alignment supports sustainable lender innovation.

Key considerations when evaluating a provider include long-term scalability, system configurability, open integration, data access, and a clearly defined product roadmap. A proven history of collaborative partnerships, rather than transactional sales, was viewed as a strong indicator of long-term success.

A real-world perspective: Cobalt Credit Union 

Cobalt Credit Union’s journey to automated lending illustrates how strategy, culture, and technology must align. According to Terry Zitkovich, SVP of lending, the organization prioritized speed, scalability, and compliance as it evaluated automation.

Cobalt’s goals included faster processing, automated decisions, and an enhanced member experience—but with realistic expectations. The LOS transformation was paired with operational changes, including centralized lending and real estate product realignment.

Zitkovich stressed the importance of early stakeholder buy-in, role-based training, and the use of “Change Champions” to foster optimism and support adoption across the organization.

Governance, trust, and continuous improvement 

Once operational, Zitkovich strongly cautioned against taking a “set it and forget it” approach to automated systems. Diligent oversight is required to manage risk without stifling growth.

Cobalt adopted a scheduled review process and analysis that leveraged data to build trust and inform thoughtful adjustments. Over time, this approach allowed the credit union to safely remove roadblocks, validate outcomes, and steadily increase automation.

Today, nearly 80% of Cobalt’s loan decisions are returned automatically, driving faster approvals, stronger SLA performance, growing membership, and improving the experience for indirect lending partners.

Technology change requires cultural change 

Cobalt learned that the transition to automated lending meant both technological changes and cultural changes. Zitkovich urged credit unions not to rush the process and to respect the complexity of change adoption, emphasizing that it takes time to trust and embrace new systems.

His advice echoed Jones’s earlier guidance: preserve what works, remain open to doing things differently, and never assume the work is “done.” Continuous testing, adjustment, and iteration are essential for long-term success. “Test, adjust, reiterate,” is the advice he offers.

Looking ahead: AI and the next phase of lending 

While adoption of automated underwriting may soon become standard practice, credit unions looking to the future have AI on the radar screen. One of the most talked about features of AI integration will be the advent of more capable digital coworkers, or AI agents, that work alongside their human counterparts to accelerate workflows, improve accuracy and reduce operational expenses.

Another AI opportunity is top of funnel loan growth, allowing credit unions to take better advantage of the data that they collect today to analyze the financial patterns of members and target marketing to expected life events.

Panelists agreed that LOS and decision automation are no longer cutting-edge innovations—they are foundational capabilities for competing and growing in today’s market. Success, however, depends on governance, partnership, and a commitment to continuous improvement.

“Crawl, walk, run,” Zitkovich advised. Automation is not a one-time project, but an ongoing journey that requires focus, trust, and alignment between technology, strategy, and culture.