MReport April 2021

TheMReport — News and strategies for the evolving mortgage marketplace.

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30 | M R EP O RT FEATURE E very lender we speak with wants to be viewed by those they serve as an innovator in the mort- gage space. They know that remaining rooted in the past is simply not an option, even when they boast a long tradition of successful customer service. Many competitors are offering their customers something new. As a result, we have conversa- tions every day with mortgage lending executives who are eager to innovate, mindful of limiting their institution's exposure to risk while meeting changing consumer demands. Too often, those conversa- tions focus solely on upgrad- ing or otherwise updating the mortgage lender's existing older technology. While this may be an option, thinking about innovation through a single channel, device, or platform is a mistake. Instead, we advocate a holistic approach to the technology road- map. We sometimes get raised eyebrows at this point, so in this article I will explain exactly what we mean and why this is the key to innovation for lenders. Why a Holistic Approach? B usy executives achieve success by creating strong processes and establishing good habits. Productivity often results from not having to think too much about the work when you really need to just get it done. It can take a disruptive event to knock us out of our routines. That's what happened when the COVID-19 pandemic struck. Suddenly, thousands of mortgage lenders' employees across the country were separated from their work terminals and companies had to quickly adapt to accommo- date remote working. In the tech industry, remote working is the norm and has been for a long time. COVID- 19 taught the mortgage lending industry that they could apply a similar working model success- fully. Overnight, IT departments were thinking beyond their old client-server infrastructures and factoring in data delivery to a host of new devices. As a result, initia- tives that had been languishing within mortgage lenders for years were suddenly mission-critical. There is an opportunity for financial institutions (FIs) to innovate and consider ways to improve communication, e- delivery, and social media use to appeal to an ever-growing market segment, the millennials. As tech- nology continues to advance, we will continue to hear consumers demand delivery of information to their smartphones to commu- nicate with their institutions. FIs are not just in the financial/ mortgage industry, they are now competing in the software space. Their competitors include Silicon Valley startups that are ready to provide financial services in a segment that is growing expo- nentially. Fintech startups bring agility and technical know-how, and will continue to push larger fintechs to innovate. While millennial customers were the first to demand a mul- tichannel experience, as they had been pushing for greater access to their accounts through multiple channels for some time, older cus- tomers are also expanding beyond the desktop and requesting infor- mation via handheld devices. That genie is now out of the bottle. There is no going back. Today, every device and chan- nel that will contribute data to the institution must be considered as part of a lending strategy, along with every path from which that data will flow to partners, customers, and regulators. It's no longer about a single-node de- livery system. Forward thinking requires consideration of all the different methods through which customers want to communicate and the ability to deliver informa- tion on any device while provid- ing a consistent experience. Taking a Different Approach T raditionally, mortgage lend- ers have constructed their technologies inside building and wired desktops from central serv- ers to allow their people to do business. In the past, this was a viable option. Those days are now far behind us. By the turn of the century, distributed data centers run by some of the world's largest and most trusted technology compa- nies were hosting more lending applications. Today, and for much of the past decade, Software-as- a-Service (Saas) offerings through these public clouds have become the gold standard of delivery for companies in virtually every industry. Among the many advantages Homing in on a Holistic Mortgage Experience Remaining rooted in the past is simply not an option. Now is the time to consider ways to improve communication, e-delivery, and social media use. By Jim Freeman

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