TheMReport — News and strategies for the evolving mortgage marketplace.
Issue link: http://digital.themreport.com/i/972321
28 | TH E M R EP O RT FEATURE T he digital mortgage revolution enthralled the mortgage industry, creating a massive sec - ular shift from pen and paper to a digital experience. Enterprise- level websites defined the first wave of this shift, which pro- vided a platform for lenders to align with consumer trends and attract borrowers online. Now, lenders need to convert their website visitors into borrowers. That's why digital point-of-sale (POS) applications will drive the next leg of the digital mortgage revolution. We've witnessed a lot of discussion surround- ing the technological aspects of digital POS applications. Digital POSs don't replace loan officers; they maximize their capabilities. Working in Tandem L oan officers (LOs) face a lot of pressure. They have to generate leads and find potential borrowers. Then there are the deadlines from real estate agents and brokers. Some corporate LOs receive strict sales targets from management. Mortgages link to macroeconomic activity, falling prone to big swings in the greater economic picture of interest rates, consumer spend- ing, and wage growth. So when business is slow, it's slow. When business is booming, it's boom- ing. And when it's booming, LOs need to capitalize and close as many loans as they can. Now, this doesn't mean that LOs should sacrifice loan quality, compliance standards, or cus - tomer relations in place of closing a loan faster. Instead, LOs must embrace loan quality, compliance standards, and customer relations while closing loans efficiently. That's where a digital POS fac - tors in, affording LOs the ability to close more loans faster while ensuring quality and compliance. Digital POS's boost LO capabili- ties in four key ways: Simplifying workflow, boosting productivity, increasing loan closures, and mak- ing borrowers happier. Digital POSs simplify and streamline workflows. According to the Mortgage Bankers Association, between 2010 and 2017 mortgages took 70 percent longer to close—with the na - tional average at 51 days. Mortgage origination always stood as a long, drawn-out, paper-intensive pro- cess. First, LOs have to validate information through third-parties like credit verifiers and banks, plus request information from those third parties, such as bank statements. Then, LOs wait for the documents to be snail-mailed and send documents back and forth, not to mention spend hours scanning through the documents and drawing red flags like income discrepancies. Once a discrepancy was found, alerting the borrower of those discrepancies and waiting for a valid explanation was the next step. I remember when I used to meet people at their kitch - en tables and fill out forms, mak- ing sure every line of information was correct. I'd spend 90 minutes meeting with them, and always left with a stack of papers. Then came 2008. The housing crisis dropped a bomb packed with regulations and compliance standards, and continue to impose new laws. In effect, timelines got extended as loans had to maneu - ver through an approval proce- dure inundated with checkpoints. All that said, loan officers need to save any time they can during the loan origination process. That's where a digital POS factors in. Shrinking Time Frames F irst and foremost, compliance standards are engineered into digital POSs. They ensure that borrowers input appropri- ate information and that the LOs have a proper base to work with. For instance, mortgage applications require borrowers to provide at least their past two years of residency. If a bor- rower inputs that they've only lived at his/her current residence for nine months, the POS is engineered to ask for further information, so it can fill in the other 15 months of required residence history. Integrations with credit verifiers, asset in - formation, employment history, and more produce pre-validated information for the loan officer. Now, the borrower isn't telling you their credit score—the credit verifier is. By spending less time verifying information, LOs can begin other origination proce - dures faster and spend more time engaging the borrower. Moreover, these integrations— the sheer power of accessing information at a faster rate— shaves time off of the loan origination process. Integrations and automation afford LOs to receive borrower information including his/her bank account, for example, in minutes, rather than having to wait days. LOs can see almost instantaneously how much money a borrower has—information that can impact underwriting factors like down payment, total loan amount, and interest rate. The best digital POSs don't only pull asset information The Loan Officer's Best Friend Digital POS systems make the loan officer's job faster and the homeowner's experience better. Learn what implementing a POS can do for your origination team. By Curt Tegeler