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Now onto the show, enjoy this episode's clip and be sure to watch the full episode right below the show notes.
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And, and Tom, so let's get to some results type information.
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So what results have you guys seen since joining this program and having shared the results?
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How has this program helped AG Fed's overall portfolio performance too? Kind of a two-parter there.
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Sure. Yeah. So I went back and looked, and since we booked our first home improvement loan in April of 2016, we originated over 3,100 loans.
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Wow. $181 million.
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So of that, we've held about 22 million on our books.
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And the other 159 million have been participated out amongst participating credit unions.
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So it's a great way, diversify the risk.
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Um, and so on top of that, it's helped us build relationships with a lot of those borrowers.
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We end up getting, they end up getting an auto loan with us.
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Mm-hmm. Or when the next time they get a first mortgage.
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So a lot of that cross sell is really another bonus to being the originator when it comes to working with LendKey.
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You know, we're seeing returns over 6% when it comes to the home improvement program.
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And the thing is, is sometimes you can say that's, that's good, that's positive or is that average.
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But the good thing about that is that's what the insurance costs put into it.
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That's everything baked in.
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And the, the loss risk is so minor, um, that, that it's made it so well worth us, um, taking in these, on these loans.
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That, I mean, that's, and then you touched on something there, Tom, that's the intangible thing.
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The ripple effect of something like this that you can bring, like the cross-selling aspect of it, uh, can bring in so much more businesses.
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Not only that, but the other business as well in which you guys have certainly experienced.
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And so, and so, um, Ryan, so what results can credit union partners expect to see in terms of portfolio growth, risk management, uh, with this program?
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I think Ag Fed is, is a great example of what can happen here.
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Yeah. So I think as, as far as returns, you know, getting to that 6%, uh, net is, is pretty standard for us right now.
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And of course, this can move with the market.
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We'll see how things move with, uh, uh, the 2026, uh, rate cuts forthcoming.
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But, um, you know, Tom did call out earlier some of the, the risk mitigation that exists inside of this program.
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And I'll just spend a couple of minutes talking about this the contractor vetting, because I think it is so important, right?
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Be and if anybody has taken on a large scale home improvement project, you may or may not have, you know, experienced a contractor that let you down so they can really you know, be challenging if you're not working with the right partners.
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So that's a big part of what we do is contractor vetting.
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So as we onboard new contractors, we're putting them through a financial review, we're pulling credit reports on the principles, we're making sure that all of their insurance checks out.
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We do that at the time of onboarding.
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And then we also have an annual review process as well.
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So in the event that something does happen with a contractor, we will get involved and make sure that the homeowner is taken care of.
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And the other piece of this is as it relates to money movement, you know, inside of our system now, there are audit controls where a contractor is going to request a disbursement, but those funds are not going to be released to a contractor until the homeowner signs off on it.
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Right? So we've got a number of measures in place to make sure that everything is, um, you know, acting as we would expect it to.
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And we do that obviously on behalf of our lenders so that they don't have to get involved and manage contractor relationships, manage borrower relationships.
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We certainly take that on as a part of
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