Putting consumers first is the only way forward

For STRATMOR Group’s April Insight report, CEO Lisa Springer reflected on some key takeaways from the MBA Technology Solutions conference.

Lenders are taking a much more consumer-driven approach to business as opposed to simply focusing on processing, or even product offering. A conference poll suggested that 58% of attendees invested in technology to improve and increase borrower satisfaction, while others invested in technology to quicken the loan process, which in turn also improves satisfaction.

One of the reasons that originators want to improve borrower satisfaction is the hope that satisfied clients will spread the word to others, both in person and on social media. But, Springer writes, the impact goes much further than that.

“Mapping out the entire origination experience from initial contact through the borrower’s post-close and servicing experience enables lenders to identify each technical and human interaction that the borrower undergoes throughout the process. The lender can then shore up any gaps to continuously improve that overall experience and retain more borrowers from a servicing perspective,” she writes in the report.

As the borrower experience continues to evolve, personal data will become more easily accessible to lenders in order to make qualification and approval decisions more efficiently, with the connections between lenders and third-party vendors operating smoother than ever. Springer mentions that ever-shortening turn times often require a lot of scrambling on the back end, but as automation takes on some of that heavy lifting, that scrambling will settle and result in a better experience for everyone involved with a transaction as well as decreasing costs.

These improvements to the mortgage process are taking place at an opportune time in the cycle of technological advancements in general, but there’s also another reason why mortgage professionals are currently prioritizing the borrower experience over everything else.

“The sustained downturn we are facing as an industry is new to many in the latest generation of leaders. The market now is about stealing share, and about driving purchase transactions and retaining borrowers in servicing portfolios. So, one key is to have great collaboration tools that enable the whole mortgage ecosystem—borrower, Realtor or referral source, the consumer, the lender and the vendors that support the lender—to all work together to close the transaction faster and ultimately more inexpensively,” Springer writes.

Tools such as bots, which are constantly being enhanced to replicate the human element in a process, are already being utilized to reduce human error and cost, and another theme explored at the conference was the eventual elimination of the LOS.

Although the LOS plays a pivotal role in the technology platforms of most lenders today, STRATMOR Principal Andrew Weiss writes that the CRM and POS are becoming more powerful and some lenders are realizing that they can assemble an ideal end-to-end borrower experience from either combining individual parts offered by several vendors and/or by developing components themselves—thereby diminishing the need for a traditional LOS. But, he adds, it’s not the right choice for everyone.

“It requires a strong commitment to investing in and nurturing a world-class Information technology team. It also requires a well thought through, long-term plan (this type of capability is not created overnight), and management who will accept the risks and the inevitable bumps in the road in trade for the potential for true competitive advantage,” Weiss writes. “In the end, even if a lender has the technology capabilities necessary to provide a seamless, paperless, digital mortgage transaction, there is one more major hurdle: adoption. Adoption—by the borrower as well as the lender’s staff—from origination to processing/underwriting through to post-closing must take place. Lenders should ensure that the new, automated processes are adopted and ‘sticky’ so that, under a crunch, their team doesn’t revert back to old processes just to ‘get it done.’”

Once a company has a valid case for a solid technology investment, Springer writes, it’s important to make enough of an investment to be successful. That means being completely committed to hiring the right people and implementing the right systems to fit that model, ensuring that implementation and execution are in line with the company’s overall business strategy. Encourage adoption by involving daily players in the solution throughout the rollout and deployment processes, and providing appropriate training, documentation and performance metrics to measure success.

“Finally, be sure to measure the impact on the consumer,” Springer writes. “Many of the solutions are about making the process better for them, so it’s very important to measure whether the solutions do make it better.”