TheMReport

26 | TH E M R EP O RT FEATURE financial institutions. Systems may need to be upgraded—not just their mortgage origination systems but also their entire operation. Business process improvements may be necessary. People and pro- cesses and components have to be put in place. Employees have to be trained to support those new systems. A digital transformation can be a complex and daunting task. And then, there's the cost factor—how much money has the financial institution budgeted for its digital transformation and how long will it take to recognize ROI when it's operating efficiently? Putting the Squeeze On L enders are looking to reduce their costs due to market compression and margin squeeze. For bigger lenders, an easy answer is to reduce staffing. But then, how do they grow market share? Midmarket and smaller lenders face the same challenges, but most don't have the option of cutting staff. They need to be more efficient, while also grow- ing market share. But how? The answer is technology. More specifically, connected tools including source data for income and asset verifications, OCR/ICR for document and data validation, and eLending tools for hybrid document execution, delivery, and retention. Regardless of size, lenders that deliver intuitive, immediate, and inspired digital lending experiences improve their ability to gain market share—and position their organizations to win by delivering a better digital borrower experience and de- creased time to close. As lenders expand volume with a faster, less complex, less risky product, they'll have more income. According to Nerdwallet's 2018 Home Buyer Report, 82 percent of millennials (ages 18-34) say buying a home is a priority, compared with 75 percent of Generation X (35-54), and 69 percent of baby boomers (55 and older). Millennials also aspire to buy a greater number of homes, on average, throughout their lifetime and are most likely to say they'd like to buy a home to rent out for extra income. Providing instan- taneous, digital access positions lenders to capture this tech-savvy generation of borrowers. Look Ahead M achine learning and artifi- cial intelligence (AI) will play a more prominent role in everything we do, including the mortgage experience. Machine learning uses data to help iden- tify trends and then feeds that data into business intelligence. The information is then used to validate or display those trends, which can point to ways to improve the business process. As more data becomes avail- able to lenders, more rules and automated workflows are created. That means repeatable intelligent decisions can be made based on all types of data and the variables, or the variable mix, of that data. When an organization starts to remove the human element from complex decisions, such as ensur- ing a borrower meets specific credit/financial requirements, it can automate those transactions, including validating when those requirements have been met. Machine learning also helps create a better borrower experi- ence, adding automation for greater accuracy and speed. New digital interfaces are developed on top of automated workflows, digital data acquisition, and au- tomated artificial intelligence and machine learning. The interaction with the borrower and back-office staff continues to evolve, becom- ing more automated, factual, and real-time. In addition, blockchain is mak- ing large strides in changing the mortgage industry. With all of the touchpoints on a mortgage trans- action, there is a need for a single source of accurate, verified data and blockchain provides that. The data from a blockchain re- cord is in chronological order and supports changes to information on liens, tax information, property assessment valuations, transfer of ownership, and other information, making it easier to verify and validate the owner of a property and its value, including the sale of assets on the secondary market. Blockchain also helps mitigate fraud and reduces time and cost during the real estate transaction, especially in the title search and insurance process. The Digital Opportunity T he opportunity exists to provide a more straight- forward, more efficient mort- gage transaction, using digital technology and automation to reduce the cost of a loan throughout the life of a loan. An intelligent, holistic process considers the full ecosystem and all the players. Digital mortgage capabilities can deliver a dramatically improved consumer borrowing experience and allow financial institutions to expand their footprints to places without a brick-and-mortar pres- ence or where loan originators aren't available. It's an opportunity to make the borrower experience easy and intuitive, and to deliver a differentiated experience quickly and accurately. LIONEL URBAN is VP, Product Management at Fiserv, and is responsible for the development and delivery of the company's digital mortgage strategy. He has more than four decades of mortgage banking experience in management, origination, operations, secondary marketing, and compliance roles within banks, credit unions, and independent mortgage bankers. Urban was previously the CEO, Founding Partner, and Chairman of the board for PCLender, LLC. In this role, he was responsible for the overall strategic direction and the vision behind the development of the internet-based mortgage loan origination software company. Previously, Urban was a Co-Founder and CEO of Navigator Lending Solutions, Inc. (NavPros) a fulfilment services company specializing in mortgage banking services. It's not enough to have a great consumer experience. All the pieces of the process have to fit and work together, and that is only achieved through integration. Without tight integration between the online origination portal and borrower engagement portal and backend processing, efficiency is lost, along with business and revenue.

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