*The Customer-Centric Perspective*
**By Joe Dombrowski**
***Having a customer-centric perspective to mortgage servicing is critical in terms of both profitability and borrower experience and plays out with essential differences, depending on a financial institution’s servicing environment. In the Multi-platform Scenario, a borrower might have a mortgage loan and a boat loan with the financial institution. Because the two loans are serviced on separate platforms, customer data is stored two places. If the platforms do not communicate with each other, customer data-sharing is minimal, if not impossible. Each platform generates its own loan information, and the institution is faced with the time- and resource consuming task of synchronizing and delivering the data in a timely manner. If the customer adds a revolving credit instrument, yet another software application may enter the picture, and that system may not be able to “see” all the borrower’s current loan transactions. This approach doesn’t work. Here’s a better answer:
****The Consolidated Scenario
****In this scenario, the institution utilizes a single platform such as LoanServ from Fiserv to administer the borrower’s mortgage, boat and revolving-credit loans. The customer information is stored on one system, eliminating the need to share data between different platforms. This eliminates data integrity issues, and as cross-sell opportunities materialize, the lender has a holistic snapshot of the borrower’s entire portfolio to assist in making prudent short- and long-term decisions.
****The User Perspective
****Operational efficiency is directly tied to how servicing staff is able to utilize technology resources.
****The Multi-Platform Scenario: For institutions utilizing different platforms for different loan products, there is no common look and feel between systems. The Consumer Loan Department may have to deal with one platform for equity loans and another for mortgage loans. The user experience suffers because staff members must create work-arounds or use manual processes to manage transactions.
****The Consolidated Scenario: Browser-based platforms leverage the Internet as a single point of access to real-time data and enable a lender to access information from virtually any application across full- or self-service channels or from third parties. This flexibility provides the framework to integrate ancillary interfaces and applications so that they work as one interoperable system instead of as inconvenient wrap-arounds. By consolidating all retail loans, an institution derives benefits from process, cost-to-service, and efficiency perspectives. It is able to standardize processes and procedures, and staff is trained once and empowered to work efficiently between lending verticals.
****In one case, a full-service bank with a mortgage banking focus recognized the opportunity to improve efficiency and drive down cost using LoanServ, the Fiserv solution that helps eliminate back-office redundancies. Prior to conversion, the bank supported its first-mortgage servicing operation within a different division from its home equity operation. By converting its second mortgage portfolio to LoanServ, the bank realized not only an 18 percent reduction in loan servicing FTEs, but also a reduction in resources outside of the Loan Servicing department charged with supporting overall operations such as IT and Accounting.
****The consolidation to one servicing platform also paved the way for consolidation of vendors in areas such as billing statement, lockbox, insurance and tax service outsourcing, resulting in a 15 percent reduction in cost to service almost immediately after conversion. In addition, the automation available within the platform’s default management functionality has allowed the bank to dedicate more of its resources to working with customers to find best-option solutions. As a result, the bank recognizes a default rate that ranks consistently below the industry average.
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