“Disruptive Technologies” is a term that was introduced in 1995 by Clayton Christensen. In his book, Disruptive Technologies: Catching the Wave, he theorized an idea called the “technology mudslide hypothesis,” which is simply the idea that an established firm fails because it doesn't keep up technologically with other firms. In some form or fashion, we are all trying to keep up with the Joneses. The same holds true for the mortgage and mortgage insurance industries. There’s plenty to keep up with – new product offerings, pricing models and integrations to new technology partners are just a few. The millennial generation has forced many companies to rethink their technology strategy and transparency, leading many to overhaul how they do business.
Throughout the industry, providing a stellar customer experience has moved into the forefront, as we fine tune how we can best market to the customer directly. Innovation in the mortgage market is in full force. Just look at all of the new Consumer Portal companies that have spawned from Silicon Valley. You can now research a new mortgage, apply for that mortgage, send and receive necessary documents, get statuses of the loan progress, and then close that mortgage all on an electronic device. A mere five years ago if you had told me a customer would complete an entire mortgage application on a mobile device, I would have said that’s “kooky talk!”
These disruptions are only gaining steam. Five years from now, consumers will likely have the power to choose their own mortgage insurance provider. More artificial intelligence will be integrated with Loan Origination Systems. New AI technology will be able to collect necessary data to accurately and compliantly render a mortgage decision within minutes.
Think this is “kooky talk?” Just look at Fannie Mae’s most recent versions of DU with validation services, early check, collateral underwriting and Day 1 Certainty products. All of these products are aligned to render a decision programmatically and then continue to learn from those decisions. We’re on our way – I’m thinking IBM’s Watson is what’s next for the mortgage industry. Are you along for the ride?
Early mornings are my most productive time of the day. Typically, I have few, if any, disruptions as I tackle my to-do list. Then, by mid-morning, my productivity temporarily halts, as my phone lights up and my inbox becomes jammed with people needing my time. No surprise though, right? We all have outside disrupters we have to manage to keep on-track for the day. The same holds true for technology disrupters. New technology disruptions are usually seen as a nice-to-have, or complement, to a lender’s current process. Things like eSignatures, self-service online applications, automated asset and income verification, and mobile strategy once topped the ‘new’ list. Though formerly known as nice-to-haves, they are now necessities for a lender to stay competitive in today’s market.