2018 is slated to be great for the technology enabled mortgage services organization. Many of the key issues and trends that helped shape 2017 will play a more significant role in the mortgage industry in 2018.
The trends of technology upgrades for the mortgage industry continue to show promising benefits for mortgage services industry. More consumers than ever are using digital channels to interact with their loan organizations, from requesting payoff amounts, to having faster access to funds and information regarding their loans and the loan process. This year, a survey by Fiserv found out that more than 68 percent of all potential borrowers would be comfortable going online to access loan statements and 23 percent would be comfortable using a smartphone to schedule payments.
With all this in mind, what should mortgage lenders include in their digital strategy?
To improve the borrower experience and reduce costs, increase transparency and to make it easy for lenders to find information for loans, lenders must employ the latest digital capabilities. This goes way beyond reducing and removing the need for “paper” from the mortgage process. Digitization must include a complete online application process with interoperability with other loan systems.
The information given by borrowers can be digested quickly to expedite the lending process. The benefits of algorithms, AI and machine learning can help inform underwriting decisions, and influence how lenders find new borrowers and determine which products they offer them. The analytics automation could also help lenders find which borrowers will soon need help making their payments. After a borrower closes their loan, AI and machine learning can help monitor their future mortgage credit pulls for mortgage brokers. If the borrower is in the market for a purchase or refinance, the system can connect the borrower back to the original mortgage broker who closed the loan to see how they can help. The branch location AI benefits could include streamlined back-office functions.
There will be more uses for blockchain technologies. Lenders are beginning to look at blockchain to aid in increased transparency and efficiency to lending process while reducing risk. A distributed ledge process will allow all parties involved in a mortgage transaction to see where they are in the process and what is the status of the loan. Enabling a cryptographic level of security to claims against the data. Blockchain can help make the paper record obsolete and less likely to alteration and misrepresentations.
From the application date to the time it takes to close on a home loan, the use of more technology in the past year has helped to reduce the loan process on an average of 9 days. This increases with more use of digitization of the lending process. The loan process is becoming more streamlined with the increased use of technology. More consumers want a more digitized process to increase the speed in the mortgage process. Employing a fully digital process and not an appearance of a digitized process will not reap the same benefits.
Government-sponsored enterprises’ credit box options continue to be tech-enabled to help streamline the interoperability of the lending process.
With the typical home buyer waiting until the right time to purchase a loan, loans will continue to increase for home owners who are taking advantage of the equity in their homes.
Lenders can help consumers who stay in their homes and analytics engines can help with understanding the shifting market for lenders to make the most of the lending options to offer to the equity-enhanced potential borrowers.
Now you ask: how much digitization is right for you? As much as you can employ! Technology enabled mortgage services is not going away. The latest surveys show that the less your borrowers interact one-on-one and more online, the more efficient the process becomes, and more ROI can be gained. Find the right partner who can tailor your technology upgrades to your needs.