TheMReport — News and strategies for the evolving mortgage marketplace.
Issue link: http://digital.themreport.com/i/1505576
August 2023 » thefivestar.com 57 August 2023 F E A T U R E can complete a project in nine months, but a hyper-experienced external one takes three. In that case, you must factor in the opportu- nity cost of that six-month lag along with the outsourcing fees. Phase 3: Identify Timelines for Implementing Upgrades E ven though it's challenging (read impos- sible) to forecast significant inflection points in the market with precision, your FI still uses scenarios that include a base case for planning purposes. You're also watching markets to identify opportunities—for new products, lines of business, etc. So, start with your long-term strategic objectives and determine the technology required to achieve them, their cost, and their implementation times. At that point, you can approximate a start date for a particular project. For example, suppose a strategic objec- tive is to improve the mortgage application customer experience to boost your close rate, cut operating costs, etc. You may need to implement a new application portal, which can take at least 90 days. So, if you believe the market will turn about a year from now, then several months from now, you should start choosing and implementing an application. Similarly, if your strategic objective is to enter a new line of business—mortgage servicing or expanding the menu of loan programs, for example—then that will re- quire technology and processes you'll need to implement that will take time to accomplish. You Can't Predict the Market, but You Can Prepare for It I f the last three years have taught mortgage professionals anything, we never know what's next. In a cyclical industry like this, any relative lull is an excellent opportunity to take stock and make plans. We're in one of those lulls right now. As we wait to see where interest rates go next and how many other mortgage market variables play out, now is a great time to identify your organization's most significant opportunities and define the conditions that will trigger action to seize those opportunities.