The Right Way For Lenders To Branch Out

*The Right Way For Lenders To Branch Out*
**By Tony Garritano**

***What will branches look like in the future? Will they even exist? The answer is Yes. Technology was supposed to replace the underwriter after the advent of DU and LP, but it didn’t happen. After that technology was going to replace the broker and LO, but that hasn’t happened either. In this case, technology exists today to create a 100% call center environment instead of a branch, but most only see this as a limited model. Here’s why:

****“We like the branch organization model because it fosters growth for the lender quickly,” said Brian D. Lynch, the founder and president of Irvine, Calif. -based Advantage Systems, a provider of accounting and contract management tools for the mortgage banking and real estate development industries. “Turning brokers into correspondents is tough. So, most lenders put the branch manager in charge, which requires some technology investment. An automated approach makes this possible, but when done well lenders can expand almost at will.”

****“It comes down to that face-to-face, trusted advisor model,” added Joey McDuffee, director and head of marketing of origination vendor Wipro Gallagher Solutions. “The biggest issue with a branch is the infrastructure. From a technology perspective, you need to embrace ways to push data into the field. We’ve done a lot of work in the mobile space. We think mobile technology is a good way to ensure data accuracy. Branches are really becoming a community center, so they are relevant, and technology can play a big role in helping the branch provide better customer service overall.”

****It also comes down to efficiency. One way to make the branch model the most efficient model out there is to go paperless. “We’ve been betting that the retail model is the winning model,” pointed out Sanjeev Malaney, co-founder and chief executive officer for Capsilon, a provider of cloud-based document sharing, imaging and collaboration solutions for businesses. “As a result, we have been focused on providing technology to enable branches to go paperless and still collaborate efficiently. Our lenders tell us that this is what they need to make their business succeed.”

****But what does the lender truly think? Are they fully invested in a more modern, technology-savvy branch model after all? “With our organization, the branch model allows us to focus more on the purchase world,” noted Kevin Stitt, founder and president of Tulsa, Okla.-based Gateway Mortgage Group LLC, a complete end-to-end mortgage banking firm that specializes in originations, servicing and correspondent lending. “The call center model works better for just refinances. The branch model also allows us to create branding and put our name on the side of a building to establish our company in a local neighborhood. We like it.”

****So, I guess branches are here to stay.