Are you engaged in the digital mortgage revolution? If not, are you prepared to jump in? Just as Google replaced encyclopedias and credit cards replaced cash, technology is transforming all facets of the mortgage industry. From shopping rates online, to finding a lender, to getting approved, the mortgage application process is moving from loan officers’ desks to computer screens, tablets, and smartphones. As the mortgage application process is evolving online, so has the competitive marketplace. The traditional methods that led to loan origination success in the past are less effective today. Lenders are struggling to attract new borrowers, let alone satisfy today’s borrowers’ digital needs.
New competition has emerged from the digital revolution and is quickly capturing market share and revenue from traditional lenders. Some lenders haven’t gone digital yet because they don’t know how to deliver on the digital experience. Others dipped their toes in the digital water but focused only on the user experience and have failed to deliver on a truly digital lending process.
Even more challenges accompanied the mortgage industry’s move to digital. While regulations and costs increased, loan originations decreased. According to Black Knight, overall mortgage originations dropped by 34% in Q1 2017. The addition of constantly changing rules and regulations, heightened scrutiny, and the risk of costly penalties and fines for non-compliance added overhead for lenders has ultimately increased the cost to originate loans.
Despite these challenges, no one can dispute the value and necessity for lenders to embrace digital mortgages. Lenders that can deliver on the digital lending experience by automating the entire lending process will be able to streamline the application process, decrease origination costs, increase loan officer productivity, and improve the borrower experience. As borrowers interact with the front end of the application process the digital mortgage platform has the ability to verify that information through integrations with mission critical third-party vendors. This key function, one of many digital mortgage perks, allows loan officers to spend less time verifying information, less overhead for mortgage originators, and a simpler and quicker process for the borrower.
The traditional transaction timeline in the mortgage industry is highly inefficient compared to other industries. The average time for loan approval is 18 days and 50 days to complete the full process. The cost for mortgage companies to pay employees to complete repetitive tasks is about $8,000 and these inefficiencies have been passed onto borrowers. With no desire to transcend their services, the mortgage application process is an unattractive chore and no longer fits in the lifestyle of the technologically adept consumer. Lenders need the most dynamic lending tools to truly deliver on the digital mortgage experience.
What options do lenders have in enhancing their lending platform to deliver on the digital promise?
With online lending, the industry is making a digital transformation by taking the borrower into a world of digitized processing at all stages of the loan lifecycle. More and more borrowers are consistently looking for the digital mortgage experience. With innovation and digitization, borrowers look to complete the 1003 application, digitally in less than 10 minutes with greater speed and accuracy.
This type of Innovation doesn’t only improve the consumer experience, it also has major bottom-line benefits to Mortgage companies. The digital experience increases the amount of money flowing into mortgage companies.
Today’s digital experience must provide borrowers with a compliant, aesthetically appealing, and user-friendly web solution that includes key program integrations. With the right solution borrowers immediately gain access to a network of Mortgage and Real Estate professionals that can offer a swift online purchasing process. The key aspects that make this experience possible are:
>>Integrations with mortgage critical third-party programs and well documented application program interface (API), which allows for a variety of software components to interact effortlessly. This enviably simplifies and accelerates the borrower process and user experience.
>>A digital graphical prequalification application and 1003 application that streamlines mortgage processes including both the point of sale stage and loan origination.
>>A content management system that accomplishes compliance from the corporate level down. The system is controlled from one centralized location to eliminate reputational risk and any violations of compliance standards.
>>Lead generation and referral partner relationship building tools with the ability to provide affinity websites for mortgage partners such as accountants, charitable organizations, large employer, realtor sites, and more. These websites have mortgage sponsored banner ads and/or applications in place.
>>State-of-the-art technology that considerably reduces the application abandonment rate by catering to the borrowers needs and overall experience.
>>A customer portal, which allows the loan officers to keep all parties, associated with the loan process up to date with the status of the application. Parties included on this are the borrower, title company, co-borrower, and realtor.
>>A tailorable online lending platform that allows lender the ability to easily configure the platform to their specific lending process.
The mortgage industry’s strict compliance standards pose unique challenges that other industries lack when converting to digital. Therefore working with a provider that has deep mortgage experience can be the difference between success and failure. Mortgage origination entails handling borrowers’ sensitive information. In addition to compliance, cyber security measures are vital. This includes applying a secure sockets layer to website domains, obtaining a SOC 2 audit, and partnering with cloud providers and third-party vendors that share your same security standards.
Industry leaders realize that in order to achieve digital mortgage success, it is crucial to automate the mortgage process while delivering a dynamic online lending experience. By implementing today’s most advanced digital platform, lenders will experience increasing market share, protect their corporate brand, meet strict compliance requirements and expand their digital footprint to attract more borrowers.
Over 75,000 individuals in the mortgage industry are benefiting from this type of innovative technology solution. These solutions deliver user-friendly, compliant, security, and efficiency to enhance the digital mortgage experience for borrowers, lenders and real estate agents.
At WebMax, mortgage is in our DNA. With 30-plus years of experience, we leverage our lending know-how to calibrate lenders transition to digital. WebMax’s digital experience expedites the borrowing process, helps maintain compliance, delivers dynamic online lending tools, and provides a highly innovative borrower experience.