TheMReport — News and strategies for the evolving mortgage marketplace.
Issue link: http://digital.themreport.com/i/1488302
30 | M R EP O RT FEATURE platform through their mobile phones, which they couldn't do before. Just as importantly, the lender's operations staff love not having to retype information, which they did constantly with the old platform. Faster and Better C loud-based integrations also do more than turbo-charge a lender's production process, how- ever. They improve every other aspect of the business as well. For example, when loan vol- umes began plummeting earlier this year, the default response from most lenders was to let people go. Such a strategy inevita- bly results in lower customer sat- isfaction, as there are fewer people on hand to help those who still want to borrow money to finance a home. In fact, while lenders are originating fewer loans, they are spending more time and effort on each transaction because rates have risen so quickly. Production efficiencies that are gained through cloud-based in- tegrations help lenders avoid this predicament by allowing them to retain talented originators and staff who are needed more than ever to keep manufacturing loans. These innovations help with recruiting, too—which is critical given the fact that many talented top producers are looking for lenders that can help them deliver the kind of customer service that led to their success. In a tough market, great loan officers have zero patience for lenders that can't deliver behind the scenes. When the market shifts, we inevitably see them jump ship to organizations that can provide the backend support they need to deliver results. The Platform Matters I t bears noting that successful integrations don't just happen by accident. Just like every house needs a strong foundation, lenders need an ample, dynamic, and flexible lending platform on which their business can thrive. That's why we're beginning to see a major shift away from legacy plat- forms that were designed before cloud computing transformed our industry and move toward new digital, browser-based systems that utilize the cloud and application programming interfaces. With old systems, lenders could only patch together different soft- ware and third-party products and services after much difficulty. These "integrations" were not seamless— they took a lot of time, money, and effort, and usually drained a lender's IT budget. Even after spending significant time and money, these integrations failed to deliver solid returns. In fact, they often cost more than they were worth. When something didn't work, which was often, lenders had to create multiple workarounds that usually involved someone rekey- ing data into a different system that should have been automated. Essentially, lenders were creating their own Frankenstein's monster and had trapped themselves inside an endless cycle of maintenance and workarounds just to keep everything moving. With modern, cloud-based technology and APIs, however, more lenders are moving off this treadmill and making progress toward reducing loan cycle times and lowering costs. They are also able to operate more nimbly, as cloud-based technologies allow them to pivot their businesses quickly as the market evolves. Recently, in fact, several lenders we work with have used their cloud-based digital mortgage platforms to add home equity products, specifically HELOCs, where borrower interest continues to grow. The Power of Adaptability T he late Louisiana State University business professor Leon C. Megginson was known for boiling Darwinism down to its essence, writing, "It is not the strongest species that survive, nor the most intelligent, but the ones most adaptable to change." In today's rapidly evolving housing market, these words are worth thinking about. As challenging as today's housing market may be, we know with relative certainty that it will bounce back one day. When that happens, it's highly likely that lenders that are the best at adapting to market changes—pri- marily by leveraging technolog- ical innovations—will be in the driver's seat. It's likely because it's happened before. Following the Great Recession, as several major banks pulled back from the mortgage business, it was independent mortgage bankers who began investing in new technologies to create a faster and better custom- er experience. In doing so, they began grabbing market share by the truckload. Today, while most lenders are cutting staff and waiting patiently for the housing market to bounce back, forward-thinking organiza- tions are doing the same thing. By investing in cloud-based digital technology and API-driven inte- grations, they are putting them- selves in better position to survive today's tough housing market while setting themselves up for future success. The question is, who is joining them? JOEY MCDUFFEE is VP, Sales & Marketing at Blue Sage. In a tough market, great loan officers have zero patience for lenders that can't deliver behind the scenes. When the market shifts, we inevitably see them jump ship to organizations that can provide the backend support they need to deliver results.