It's the first step to embracing fintech
For years, originators across the country have been figuring out the best way to adopt new technologies, discovering the most innovative products in the space today, and the ones that offer the most bang for the buck. The more aggressive players in the space have long adopted various products to streamline their process and make it more efficient.
If you have not adopted much in the way of technology, however, you’re not alone. Thousands of originators have kept doing business as usual, among them the unwillingness to rock the boat, or, more likely, they’re not tech savvy or don’t have the budget to bring new systems on board.
While some industry experts could argue that a good CRM is the most important piece of the puzzle, other experts say that a digital mortgage app is paramount in terms of improving the borrower experience. At Originators Connect 2018, Raj Parekh, digital mortgage strategist at LoanScorecard, revealed ways that originators can leverage fintech to increase prospects, efficiencies, and production.
Almost 20 years ago, when he got into the game, digital lending was all about consumer acquisition and getting that right lead. He and his company at the time, Lead ROI, was at the forefront of the digital lending revolution, and recently he’s noticed a shift in focus.
“In the last three or four years, there’s this thing that’s been happening with point of sale solution, and it’s changed from consumer acquisition to borrower engagement. That’s what this really has become all about: automating processes, automating origination, automating processes, automating underwriting, and decisioning really quickly, product pricing, eligibility, directly to the borrower, and the advent of what is now what everybody’s talking about, digital lending,” Parekh said.
Fundamentally, he said, digital lending is disrupting the way that the mortgage industry does business, and in the end, it’s enabling originators to lower their cost.
The most important component of point of sale solutions, the point where the borrower transacts with the lender digitally, is the digital loan application. Depending on the program, there’s the app itself that the borrower sees, and then there’s typically a back end fulfillment center, which is sometimes a loan origination platform. These apps aren’t the standard mortgage applications like you used to see, Parekh said. They’re intelligent, with some level of document upload or request components to automate that part of the process, as well as credit and income verification components.
“What’s the advantage to the borrower? It streamlines the loan process, creates more transparency, it keeps them engaged. The advantage to originators, of course it increases process efficiency, increases returns, keeps you organized, makes everything digitized, and of course, most importantly, what it’s all about, is increasing borrower satisfaction.”
The point of sale solution offered by LoanScorecard is called Zip, and one of its distinguishing features is that it offers originators is a personalized, branded url. Rather than require a borrower to log into a separate application, originators can take the url and use it however they see fit: behind an ‘apply now’ button, in an email signature, given to referral partners who in turn send it along to their clients, or incorporated into any other piece of marketing material.
Zip gets all of the information as a full 1003, and can be completed in less than 10 minutes. If the borrower gets distracted, no problem; they’re sent a reminder email, in which the link will return them right to where they left off on the application.
Everyone loves to talk about the millennial borrower because they’re the largest demographic group buying homes at the moment, but the fact of the matter is, people of all ages spend more time on mobile devices, and want services that mirror the way they live.
“We spend an enormous amount of time on the phone and we expect things to be delivered on the phone. That being said, borrowers will demand a tech-enabled process and they will demand more transparency through that tech enabled process,” Parekh said.
Even without a big budget or being an expert in fintech, loan officers can find a sleek digital mortgage app to move borrowers through the process quicker.