“This may be the first time I have ever welcomed a change to our industry”

by David Kitai17 Feb 2021

When agencies and regulators announce process changes in the mortgage industry, Randy Shamburger (pictured) will usually join the chorus of groans from every frontline originator. The branch manager and senior loan officer with Movement Mortgage in Greenville, SC told MPA that, like so many other originators, he sees most changes to key forms and steps as a headache.

However, for the first time, he said, he’s excited to see a major process overhaul from the agencies.

From January 01 of this year the GSEs began accepting loan applications on their redesigned Uniform Residential Loan Application (URLA) form. They’ve set the deadline for a full switchover to the new URLA for March 01, a benchmark that’s been pushed back due to the COVID-19 pandemic. After attending a few training sessions on the key piece of paperwork, Shamburger is a believer.

“I think this is going to benefit us,” Shamburger said. “Especially at a time like this, where we’ve been busting at the seams for nine months straight. It’s probably the first time I would ever say in this industry, where I’ve felt that this is a change I can welcome. Normally I would groan and expect a change to blow things up. I don’t think that’s going to be the case this time, I think it’s going to do nothing but help.” 

Read more: Is building your own tech platform the answer for originators?

The difference-maker in the URLA, Shamburger said, is the addition of much more detail. By including more explicit questions about the property and the source of the money for this transaction, for example, loan officers like Shamburger won’t have to chase additional pieces of information through letters of explanation.

While Shamburger noted that the extra detail required on the new URLA will require clients to take a little more time in their applications, that extra work upfront will save huge amounts of time down the road.

The form, Shamburger said, is also a “plug and play,” designed and better optimized for a digital mortgage application process. Given how digitized the application process has become, easier digital information collation through a key form like the URLA has become necessary for the functioning of any mortgage business. A lack of APIs between various key tech tools has been a serious bottleneck in the mortgage process, Shamburger said, and a digitally optimized URLA form could ease that issue.

Getting clients to accurately fill out a longer and more detailed form may pose a new challenge, but Shamburger explained that if lenders can get their tech partners to create efficient application portals clients can use online, they shouldn’t have too many issues ensuring client accuracy and attention as they complete their application.

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The end result of this form, according to Shamburger, is a quicker answer to that most basic of client questions: ‘can I get a mortgage?’ He believes that those applicants who won’t qualify for an agency loan will be weeded out faster and with less work on the part of the originator. Not only will it save time, in his opinion, it will result in a better overall client experience, even for those who can’t qualify. Customers won’t feel misled - expecting they’ll qualify for weeks, only for their loan officer or underwriter to find something that disqualifies them. If it’s a ‘no’, it’ll be a faster ‘no’.

“The people that write the seven-paragraph one-star reviews of loan officers and lenders are doing that because they’ve usually been raked over the coals a little bit. Which usually means that the right questions weren’t asked upfront,” Shamburger said. “They’re mad because it took a long time to get information that should have already been known. That’s the most common complaint. If you’re able to ask those questions more expeditiously upfront, then you’re going to get to the end result faster.”

As for loan officers who might groan about a new form to learn, Shamburger said they should think again.

“I would just say ‘not so fast’ on this one,” Shamburger said. “This should not be received with the same resistance that most changes are in the industry. I think this one is going to be a huge net positive.”