TheMReport — News and strategies for the evolving mortgage marketplace.
Issue link: http://digital.themreport.com/i/211920
cover story the country, its chairman, Dan Gilbert, has been instrumental in helping to develop a creative, tech-focused urban core where people will live, work, and play in downtown Detroit. In the past three years, 85 companies have relocated to that area, helping the city's revitalization. Giving Internet Loans the Greenlight "K eep your eyes on us because we are growing," urged David Norris, president of Greenlight Loans, located in Irvine, California. "We are a company that offers the latest in computer technology, low, competitive rates, and exceptional customer experience." On June 1 of this year, Greenlight, a company dedicated to online lending, was acquired by Lewisville, Texas-based Nationstar Mortgage, one of the country's largest loan servicing organizations. It was thought that combining the expertise and services of these two companies would create a formidable online lending team. Greenlight will handle the online lending, and Nationstar will service the loans. Because Nationstar has contact with so many consumers through servicing, this presents a large network of potential clients for Greenlight to work with, many of whom may want to refinance or purchase different homes. "Marketing costs are a significant expense for online lending, but because of Nationstar's large customer base, we can spend less on marketing," Norris explained. "Having a large service portfolio gives us a significant advantage." Norris said that there are not a lot of online lenders, and most are not very large. "Most are brickand-mortar lenders or third-party brokers," he said. "Through our combined team, we can offer more aggressive pricing on loans than other companies." One of the main reasons Norris' group is able to offer competitive prices on loans is that "as part of Nationstar, not all of our profit has to come from originations," he said. "We also generate profit from servicing." Another feature offered by Greenlight is software specifically designed to ensure the safety of customers' financial and personal information. "We have several software programs that work at different stages of the Mitigating Online Lending Concerns Consumers look for ease in completing applications and assurance that the information transmitted is secure. By Sandra Lane D espite the convenience of online transactions, consumers have some concerns including, "Will I know how to navigate this website?" and "Is my financial information safe?" Frequently, loan application websites are confusing and do not have a userfriendly flow or even simple instructions. In these situations, consumers are sometimes hesitant to reveal their confidential information. Studies have shown that the success rate of completed applications and closed loans is dependent on the ease of using a lender's website and consumers' confidence in the security of information transmitted. One of the most reliable and successful software programs being used by lenders for this purpose is EnterprisePOS, designed by Mequon, Wisconsin-based B+H Mortgagebot. 18 | The M Report This company has designed a hosted mortgage application platform that is simple to use and provides a high level of security. EnterprisePOS is the newest edition in a series of mortgage application programs offered by B+H Mortgagebot. A previous version was called PowerSite, developed by Mortgagebot, which was established in 1977 before being acquired by D+H (Davis + Henderson Corporation) in April 2011. "When designing our systems, we assume that malicious attempts will be made to access confidential information," said Corey Peissig, SVP, technical operations for B+H Mortgagebot. "That has guided us to implement a 'best of breed' security model designed for online solutions." Peissig says that D+H Mortgagebot's stance is to lower the amount of risk as much as possible. "We are unique in this manner because our primary focus is in securing consumers' mortgage application data," he said. To help ensure that all lenders' and borrowers' data are extremely well protected, D+H Mortgagebot's cutting-edge technology includes multiple, disaster-proof remote servers; redundant data backups; stringent, multi-level security protocols; extensive data encryption; and rigorous independent audits. "We want to make sure that our clients have trust in us to secure their customers' data," Peissig said. "We never take that for granted." "Since ease of use is very important," Peissig continued, "our programs have been designed for the novice consumer. They allow the process. All of our information is encrypted, and we believe our clients' information is very safe," he explained. Concerning the future of online lending, Norris said, "I believe online lending will continue to grow as people become more comfortable with it. There is always going to be a concern from first-time homebuyers about working online. They might prefer to work face-to-face, but once they realize that the transaction is fairly simple, they accept it." Online lending is the future, believes Norris, because it is more efficient and less expensive. "When buying a first home, people are usually more focused on the home and don't pay close attention to the price," he said. "They don't realize that oneeighth of a point can be a large user to go through the application process in an interview-style format to enter data without understanding all the details a mortgage application requires." He said that applicants are asked subsequent questions, depending on how they have answered previous questions. For example, if an applicant doesn't have a spouse or second job, the program will not ask those types of questions. A continuous review of the effectiveness of the EnterprisePOS program is made, Peissig explains, and if any difficulties are found in using the program, updates and revisions are made. "We study where errors by consumers are occurring, and we will correct that particular function to make it as easy as possible for anyone to complete a mortgage application," he said. Peissig says that EnterprisePOS is adaptable to any size bank or credit union. "The great thing is that the size of the institution doesn't matter. Everyone has the same exact security model. The smallest lender has the same amount of security controls that the largest lender does," he added. B+H Mortgagebot currently hosts mortgage websites for 1,300 banks and credit unions nationwide, which originate more than $150 billion in mortgage applications annually.