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ATTOM Data Solutions released its Q4 2016 U.S. Residential Property Loan Origination Report, which shows more than 1.7 million (1,748,177) loans were originated on U.S. residential properties (1 to 4 units) in the fourth quarter of 2016, down 15% from the previous quarter, but still up 2% from a year ago. More than 7.3 million loans were originated in 2016, up 2% from 2015 to the highest total since 2013. Total dollar volume of loan originations in the fourth quarter increased 8% from a year ago to more than $461 billion ($461,291,961,501). So, what do these industry dynamics mean for lenders? Lisa Schreiber, EVP Operations at Sprout Mortgage, talked to us about what lenders need to do in order to thrive in the current mortgage market. Here’s what she said:

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Q: What’s ahead for Sprout Mortgage this year?

LISA SCHREIBER: We are growing our product line. We are not just offering more products, but new services, as well. We are growing our national sales strategy across the country. We’ll be in all channels of business. So, we’re very excited about 2017.

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Q: What are Sprout’s technology priorities this year?

LISA SCHREIBER: We are building out automation for decisioning on non-QM products. We are working with a vendor right now. That technology will be embedded in our LOS and we’ll white label it for our correspondents. I’m looking to find good tools to obtain documentation without putting that responsibility on the borrower. We want to help the borrower through the process and put less of the burden on the borrower to provide paper documents like bank statements, W2s, etc.

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Q: What do you see as the future of straight through processing?

LISA SCHREIBER: When I was at Ellie Mae we were talking about mortgage as a manufacturing process. We can do a much better job of accessing client data upfront. We need to be clear upfront and have triggers throughout the process that constantly keep the borrower informed.

Q: How does the mortgage industry craft a process where the user experience has no friction?

LISA SCHREIBER: No friction is difficult. It goes back to how we can better enable borrowers. I have daughters in their twenties and they don’t like to talk to people as much as we do. They want to do things with the push of a button and they want to be informed at every step, as well. So, it’s a combination of technology and people power.

Q: How will the recent governmental changes impact the mortgage market in 2017 and beyond?

LISA SCHREIBER: The big headline for us is Dodd-Frank. Several people, myself included, do like more structure. However, the timelines set up by Dodd-Frank are a little crazy though. I’d like to see some portions of the regulation go away, but not everything all together. It’ll be interesting to see what happens to Dodd-Frank. When they say they want to get rid of regulation, what does that mean?

Q: When evaluating their technology strategy, what elements should lenders keep in mind?

LISA SCHREIBER: There’s no one technology that is going to be everything to everyone. Lenders need to really think and plan first. Most times lenders just grab a piece of technology and build it out because we’re still doing loans and we still have to make a profit. We don’t always whiteboard or analyze things fully before buying a piece of technology. There should be someone in the organization that is always thinking globally. It’s hard to plan everything out, but some times you spend more resources to fix new technology then you should.

Q: What is perhaps the single biggest misconception lenders believe regarding technology?

LISA SCHREIBER: That it will solve all of their problems. That it will work when you turn it on. That it will instantly solve the problem without the lender having to put much thought into it. It’s not going to automatically work and not everyone in your company is going to automatically understand how to use the new technology.

Q: What do lenders need to do in 2017 to remain competitive?

LISA SCHREIBER: Lenders have to assess cost and try to manage cost better. We are coming out of refinance boom so people spend a lot of money getting to all the refinance business, but that changes in a purchase market. Lenders have to adjust to spending their money wisely in a purchase market.

Industry Predictions

Lisa Schreiber thinks:

1.) Interest rates will rise, but not by too much.

2.) It’ll be a terrific year for purchase volume.

3.) There we be a lot of product development and new products entering the market to address particular borrower needs.

Insider Profile

Lisa Schreiber is EVP Operations at Sprout Mortgage. She is a true mortgage industry veteran that has worked with lenders, technology vendors and as a consultant. She was a Regional VP at Bank of America; EVP at American Brokers Conduit; EVP of Wholesale Lending at TMSFunding Wholesale Lending; VP of Correspondent Lending at New Penn Financial; VP, Lender Business Development at Ellie; President at LSK Consultants, etc.