MReport March 2020

TheMReport — News and strategies for the evolving mortgage marketplace.

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6 | M R EP O RT MTECH Fintech and Alternative Lending Expected to Eclipse $390B THE U.S. AND CHINA HAVE CORNERED LARGE SHARES OF THE ALTERNATIVE LENDING MARKET. L earnBonds reported that while traditional banks still hold the largest share for consumers and businesses, fintech lending is beginning to make its move in the market. The report states that fintech lending will hit a $312.6 billion transaction value—growing 17% annually. The market is expected to reach $390.5 in value by 2023. Global fintech lending was worth $181.2 billion in 2017, which jumped to $267.1 billion in 2019— an approximate 30% increase. The report states the overall market is forecast to grow by 7.7% over the next three years. The U.S. is the second larg- est fintech lending market in the world with $33.5 billion in market value. China has a fintech lending value of $265.7 billion transaction value and 90% of the market share. Jennifer McGuinness, Co- Founder and Managing Partner of Strategic Venture Partners, spoke with MReport recently about the future of fintech and the benefits it brings. "The technology solutions that are going to bring the best benefit to the businesses are going to be those that manufacture things more efficiently, cut timelines, and risk-insulate process flows to optimize outcomes. At the end of the day, it'll actually save the companies a vast array of money and compliance issues." McGuinness added that the more the industry digitizes the mortgage experience, the more fraud insulation there will be. She suggested that these changes will bring better underwriter outcomes and shorter timelines for lenders, which will in turn bring more closed loans and more revenue—a benefit for both the borrower and investor. Fintech was a topic of dis- cussion at the 2019 Five Star Conference and Expo, with McGuinness saying, "its purpose is to make our jobs easier." "Technology will not fix a bad business practice," said Rick Sharga, President & CEO, CJ Patrick Company. "Technology will make good business practices better." Panelists discussed new in- novations such as blockchain and digital mortgages and talked regulation and consumer expecta- tions. LoanScorecard and Deephaven Improve IDENTI-FI Scenario Calculator THE ENHANCEMENT WILL DELIVER CUSTOMIZED, LOAN-SPECIFIC CONDITIONS INSTANTLY. L oanScorecard and Deephav- en Mortgage announced that they have added the Smart Conditions feature to Deephaven's IDENTI-FI Scenario Calculator. The enhancement will deliver customized, loan-specific condi- tions instantly, based on findings from Deephaven's IDENTI-FI AUS engine. Originators use the IDENTI- FI Scenario Calculator to view product and program eligibility scenarios, price loans and obtain detailed AUS findings from directly within the scenario calcu- lator. Now the Smart Conditions feature will also pull loan-specific details, such as bank names for asset verification and liability repayments and dollar amounts for closing costs and reserves, and auto-populate them into the con- ditions that the originator sees. "Our partnership with LoanScorecard has enabled us to continually enhance the non-QM point of sale experience for our originators," said Mike Brenning, Deephaven's Chief Production Officer. "Today's announcement is another example of this collabora- tion. Most AUS engines generate generic, vague conditions that can be misunderstood or misinter- preted, creating confusion, delays and frustration. The new Smart Conditions feature will instantly show originators precisely and clearly what needs to happen in order to get an accurate review of the loan." Raj Parekh, LoanScorecard's Managing Director, said, "As the non-QM market continues to expand and evolve, leaders like Deephaven are differentiating themselves by using technology to continually enhance the client experience that they offer. Adding greater precision and clarity to critical functions, like conditions, will help originators quickly grasp what is required to submit a more complete file, and communicate it more simply to their borrowers." Smart Home Market Expected to Hit $158B by 2024 TECHNOLOGY BECOMING THE NORM IN HOW BUYERS, SELLER WANT TO INTERACT. D ata from PreciseSecurity. com projects the global smart home market revenue is expected to reach $158 billion by 2024—with the U.S. leading the way with $27.6 billion this year. The report adds that one-third of all smart-home device owners are millennials. The global smart home market was worth $43.4 billion in 2017. Industry revenue has doubled and is expected to reach $91 billion in 2020. Statistics indicate the overall market will have an annual growth rate of 15% by 2024. Global consumers are expected to spend $21.5 billion in 2020 on devices they can connect to smartphones or tablets for more control and information. This seg- ment of the market is expected to jump to $39.6 billion by 2024. The move to technology is not only evident in the gadgets home- owners can use, but also in the ways that prospective homeown- ers decide how to buy and sell. A survey by Matterport found buyers and sellers are more likely to switch to agents who utilize tech and AI. The survey polled 2,000 prop- erty buyers and sellers and nearly 80% of those surveyed would switch to a real estate agent offer- ing 3D tour of properties. Millennials and Gen Z respon- dents are overwhelmingly in favor of more immersive listings, "The technology solutions that are going to bring the best benefit to the businesses are going to be those that manufacture things more efficiently, cut timelines, and risk- insulate process flows to optimize outcomes." —Jennifer McGuinness, Co-Founder and Managing Partner, Strategic Venture Partners

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