MReport February 2020

TheMReport — News and strategies for the evolving mortgage marketplace.

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18 | M R EP O RT COVER STORY how organizations create value and compete. Through previous studies, we found that lenders have consistently shown a strong interest in leveraging technology to improve both the front-end consumer experience and back- end operational efficiency," said the author of the piece, Kimberly Johnson, EVP, COO, Fannie Mae. Fannie Mae says 44% want to see improvements of the front-end consumer experience, 18% say they feel back-end operational efficien- cies are most important Thirty-six percent said that both are equally as important. "Today, the majority of lenders have taken a more compartmental- ized approach to technology use and tend to focus more on applica- tion intake versus truly delivering a great borrower experience with real tech optimized operations. While they have some of the tech- nology solutions available, many lenders do not require that their full teams use the solutions nor do they truly train them to use it in an optimized way and thus they allow a lot of ad-hoc structures and process flow to exist that may go around the technology. By allowing this, it's hard to mea- sure the real value-add when the technology goes live," said Jennifer McGuinness, Head of Aggregation & Structured Finance at Mortgage Venture Partners. "And if they were to train more efficiently and require consistent use of these technologies, they would see a more significant uptick in volumes and also operational efficiency." McGuinness added that a lot of alleged "borrower experi- ence" front-end technologies are "glorified loan application engines" verses full lifecycle technology so- lutions which should include ev- erything from without limitation lead intake to loan application, processing, condition clearing, diligence, and service set up. She added without in a more "full- scope solution," they don't add much value away from a standard application process that lives in a loan origination system. Ghamsari said of the idea of technology improving mortgage lending: "We can't wait until we have a perfect solution to drive change." He added that to improve the housing industry, profession- als "need to put a stake in the ground" and iterate from there." "If we can automate loan files that don't need extra attention, we have more bandwidth to focus human capital on helping special cases reach their goals," he said. Stubbs said there are "virtu- ally unlimited" impactful ways to introduce technology to mortgage lending. "The most powerful near-term lever is to reduce burden and complexity for the customer. While there are many things that have to evolve first, there is no fundamental reason that a mortgage approval cannot be completed in one day," he said. Nair added that the mortgage industry needs to utilize technology to "re-imagine" the user experience from origination to servicing. "We need to continue to get smarter about what consumers want and need, and in turn, help educate them about loan products and services," Nair said. "By being proactive with data we can better influence their buying decisions." Smith expanded on this thought, adding lenders can best utilize technology to provide bor- rowers with "the experience they want." He added customizable processes are vital—even custom- izable by channel. Smith, additionally, said bor- rowers want the process to be as simple and painless as possible. "They want to spend the least amount of time possible verifying, confirming and providing extra information," Smith said. He added that one of the best ways to go digital is through digital verifications. These can cut up to two weeks off the time needed to verify assets, income, and employment. "It is a good first step to utilize technology to make an impact in both the satisfaction with the customer experience and the cost and time savings to the lender and loan officers," Smith said. Another item that could improve the consumer experi- ence is the addition of eNotariza- tion. A report by Yahoo Finance from January said that eNotary laws went into effect January 1 in Florida, Idaho, Kentucky, and Oklahoma. Twelve other states could consider eNotary laws or remote laws in 2020. While there is demand for this service, McGuinness said compli- ance on eNotarization could get "really tricky" unless for example , video is taken or other validation to confirm that all parties that are supposed to be involved actually are. "I think that if they don't do that or they only have a "one- sided" validation, the industry may be opening itself up to new fraud and this is exactly what technology should be helping us to insulate," she said. Too Much of a Good Thing? T echnology is present in every facet—almost every minute—of our daily functions. "The most powerful near term lever is to reduce burden and complexity for the customer." —Rocky Stubbs, SVP Direct Lending, Flagstar Bank

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