Today there are many OCR technology options available to assist in the automation of mortgage loan processing. Some solutions are well marketed and low cost with great claims of vast libraries of rules and an ability to provide tremendous results. Unfortunately, the reality is that OCR technology users and prospects are often disappointed in the results of current and past OCR evaluations and initiatives. So, they’re understandably cautious and untrusting. To overcome much of the confusion and disappointment, a better evaluation process in many cases may go a long way towards greatly minimizing the risks involved in choosing an OCR technology vendor.
In order to quickly understand an OCR technology and its capabilities, a blind test with several sample files should be considered the gold standard for an evaluation. This is especially true when it comes to the challenges presented with the many and varying document types and quality levels of document images found in the mortgage industry. Asking vendors if they are willing to perform a test on a never before seen sample set of typical loan files on siteand in sightof your evaluation team, is a good first step in shortening your list of viable vendors for your project.
The test is often conducted on-site, rather than at a vendor’s facilities, due in part to the typically confidential nature of the content, but to also minimize concerns about the possible skewing of any results behind the scenes. Look for a pre-built mortgage OCR library which can offer clients a short evaluation and implementation timeline rather than a requirement to develop processes and rules from the ground up. Ideally, an evaluation should be setup as a One-Day Blind Test. This kind of test is intended to demonstrate the validity of vendor claims so that prospects can be assured that they are considering a proven, robust and scalable solution ready to deliver productivity improvements in weeks rather than months or years.
In the course of a One-Day Blind Test, provided loan files should be indexed by document type and 50-100 data fields should be extracted from various key documents like the Note, Deed of Trust, Closing Disclosure, and Appraisal. Output results should be provided along with statistical reporting describing automation and processing times.
Unfortunately, many companies base their buying decision primarily on price, only to be disappointed with the lack of true out-of-the box mortgage-specific functionality offered by the product. In other cases, great claims are made regarding OCR automation, with the reality being something less impressive.
For qualified opportunities, Paradatec has been performing this process which enables prospective clients to quickly understand the overall levels of automation and speed improvements they will be able to achieve with their technology. Paradatec calls their evaluation the One-Day Blind Test Challenge.
Paradatec’s Advanced OCR solutions offer significant efficiencies for classifying large quantities of differing document types and extracting key data elements from those documents. In the mortgage market, these capabilities allow for the quick and accurate identification of over 500 unique documents in the typical mortgage file, along with capturing nearly any data element from those documents that an organization requires. For more information, please visit www.paradatec.com.
About The Author
Mark Tinkham is Director of Business Alliances at Paradatec, Inc. Over the past twenty-five plus years, Mark has worked for technology companies that deliver innovative solutions to the financial services industry. For the past ten years, his primary focus has been bringing efficiencies to the mortgage market through industry leading Optical Character Recognition (OCR).