Efficiency is great, but reducing the increasing costs of mortgage originations are an equally important reason to incorporate tech into your business plan
In today’s day in age, the entire world is going digital. From turning the lights on in your home, grocery shopping, all the way to applying for a mortgage; these processes can now be completed effectively through the use of digital technology.
These processes are available to make complicated, in-depth tasks easier and more accessible for the consumer. In terms of the mortgage industry, digital point-of sale (POS) applications are available to assist not only the homebuyer, but the lender as well. The cost to originate a loan in the mortgage industry is constantly rising and has become one of lenders’ biggest concerns. Therefore, digital mortgage technology fights origination costs by automating processes and saving the lender’s time.
It’s no surprise that digital POS applications are growing in the mortgage industry. Not only is it more convenient for the homebuyer, but it assists the lender throughout the process as well. As for the borrower, they can apply for a loan while they’re in the car on a road trip, or simply sitting on their couch watching television. They don’t have to go through as many questions that don’t apply to them, and they can avoid the back and forth process between the bank and their loan officer. A handful of digital applications even include full customization with real-time data validation, ensuring that the lender is receiving quality data. Needless to say, this process is accelerated and able to be completed in significantly less time. This newly enhanced, digital 1003 application saves both the lender and borrower their time and money.
While the mortgage industry’s origination costs are steadily rising, digital mortgage platforms are combating them by cutting closing times, paperwork, and inefficient procedures. Automating assets and employment has never been easier. For instance, many digital mortgage providers allow borrowers to upload their documents by taking a simple picture on their phone. The document would then be converted into a digital file, ready to get pushed through the loan origination system. This not only saves time, but costs as well. The amount of bulk paperwork is decreasing by going digital, as well as the assistance needed from the loan officer. Going digital leaves more time and funds for other important tasks.
This advanced process ensures efficiency by allowing potential homebuyers to work their way through their loan application without becoming overwhelmed. It’s a win-win scenario for both parties involved. Because digital point-of-sale applications have been known to decrease the industry’s abandonment rate by more than 50%, lenders are no longer putting out origination costs for loans that never get completed. The entirety of this concept is based on getting the borrower to submit their completed application so that the lender isn’t putting out origination costs for every unfinished form. The world is changing, and it’s up to lenders in the mortgage industry to keep up with the advancing technology; it will not only benefit the borrower, but it will ultimately benefit their company.
Kelcey Brown is responsible for developing, communicating, executing, and sustaining strategic initiatives. He acts as a key advisor to president on critical changes in the competitive landscape, internal employee development and the external business environment while also ensuring that appropriate metrics are in place to measure performance and progress towards strategic goals. Brown is also accountable for spearheading the success of our clients by developing and managing product training and growth initiatives.
