Here’s a look at 5 ways advised by mortgage industry experts that can bring transformational changes in mortgage processing to generate better customer experience.
Set Up a Check-List Based Approach: Manual examination of borrowers’ credit information is highly susceptible to errors. They often tend to overlook minute inconsistency in borrowers’ credit histories. Such inconsistencies severely impact the quality of loans disbursed. A last-minute attempt to address these inconsistencies delays the entire loan closure cycle. To avoid such a situation, experts recommend following a standard check-list based approach. This approach ensures that all the necessary documents are available and is distributed to concerned teams on time. Repetitive tasks such as processing and verifying data from massive number of loan documents, status verification from third parties, audit trials, among others should be automated. Automating such repetitive tasks helps lenders to streamline multiple steps involved in mortgage processing. This reduces the entire loan closing type, thereby resulting in better customer experience.
Define Responsibilities: Mortgage closing packages often have erroneous or missing documents. This increases the amount of rework and communication within mortgage loan processing departments to fix errors. It reduces employees’ overall productivity. Reworks further prolong the loan closure cycle, thereby adding to customers’ dissatisfaction. Experts recommend developing quality control checklists to establish loan documentation submission protocols. This ensures accurate loan document submission. Stakeholders across mortgage processing stages should be made of this checklist. Lenders must clearly define their responsibilities of using this checklist to proactively identify any document-related errors.
Move Applications through a Triage Process
Underwriters may miss riskier loan applications because of an arbitrary processing of mortgage loan applications. This results in a suboptimal underwriting decision, thereby leading to a bad loan approval. To avoid such a situation, experts advise developing a triage method of processing loan application. To put it in a simpler way, lenders must rely on a rule-based engine that automatically processes routine files to entry-level underwriter and process the complex files to experienced underwriters. This strategy is highly functional in helping underwriters arrive at faster decisions. This ultimately contributes to shorter loan processing life cycle.
Keep Borrowers Updated: Mortgage processing typically involves lot of paperwork leading to inevitable delays. This makes it difficult for lenders to update borrowers on their loan application status on a timely basis. As a result, borrowers get frustrated, and lenders end up losing potentially big accounts. Lenders’ representatives must provide borrowers with a loan processing timeline upfront.
Use a Cloud-based LOS: Loan origination system (LOS) is a software platform used by mortgage lenders to complete and facilitate lending processes starting from origination to post closing. This tool is designed to execute a range of functions that include loan origination, pricing, borrowers’ eligibility check, among others.
A Fiormarkets research report suggests that the cloud-based LOS market is set to touch a value of USD 3540mn by 2024.
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