The clock is always ticking
This article was provided by wemlo. We at wemlo are leaders in mortgage loan processing, pioneering the third-party processing industry by directly connecting brokers with the nation's largest processing network and our proprietary software. Start your journey with wemlo by setting up your first 15 minute meeting HERE.
For most consumers, instant gratification is expected in everyday life and most of their transactions. Same-day deliveries and one-click orders are no longer the exceptions, but instead the norm. In fact, 64% of customers say speed and responsiveness are as important as price when they decide where to make a purchase.
However, there is one process that can’t be made instantaneous. In the mortgage world, we can only dream of auto-generated appraisals and same-day application approvals. While drones can’t speed up the mortgage process (yet), there are a few ways savvy mortgage professionals can optimize the lending transaction.
The Need for Speed
Necessity is the mother of invention, right? Today’s fluctuating marketplace essentially requires nimbleness from mortgage professionals. While there are many moving parts in the mortgage transaction (understatement of the century, we know) there are a few key areas Mortgage Loan Originators (MLOs) can direct their focus to.
According to Ellie Mae data, the average time to close on a mortgage loan is 52 days. This seven-week window of time leaves ample opportunity for a lending experience to go awry, and every industry veteran probably has their own horror story about a less-than-ideal borrower transaction.
Loan processors and loan originators play different (yet vital) roles during the lending process. While loan originators are usually more client-facing, loan processors generally work hard behind the scenes to ensure a loan closes on time. This backstage view gives processors a unique perspective on how a loan process can be a smoother, quicker process or a nightmarishly slow experience.
So, what can MLOs (and other mortgage professionals) learn from loan processors about accelerating Clear-To-Close (CTC) times? Check out these insider tips from three processing trailblazers.
Tip 1: Humanize the Process
The mortgage process can be highly emotional and panic-inducing with 44 percent of borrowers stating that they felt nervous throughout the process. Catherine K., senior loan processor at wemlo, says that getting to know your borrowers beyond the paperwork can help exponentially during the emotional rollercoaster that is the homebuying process.
“When you learn things about your borrower (preferred communication method, work hours, experience with technology, etc.), you can gauge the best way to get what you need to expedite the CTC. I’ve tailored the way I work through a loan based on the borrower’s preferences. Some borrowers just want a list of necessary documentation so they can knock it out within a few hours and other borrowers need me to hop on a Zoom call and walk them through each step.”
At the end of the day, mortgage professionals are in the business of customer service and making homeownership dreams come to life. While it’s easy to get lost in the weeds of day-to-day operations, it’s important for mortgage professionals to recognize and hopefully appreciate what a privilege it is to help make borrowers’ dreams come true.
Tip 2: Maintain a Customer-Centric Mindset
The mortgage industry is full of jargon, different lenders and loan types, and fluctuating rates. For even the most seasoned professionals it can be hard to keep up, much less for borrowers (especially first-time homebuyers). An MLO is a borrower’s lifeline and it’s important to coach borrowers through the ins and outs of the often-confusing, usually intimidating home financing process.
For veteran wemlo loan processor Andrea H., setting expectations at the outset of each transaction is fundamental to facilitating a smooth experience for all parties involved. When working directly with borrowers, Andrea H. firmly maintains that no question is a stupid one. “Communication is key in making sure a borrower understands each step of the process. As a processor, it’s my job to read the room and ensure the borrower feels comfortable and empowered on their home loan journey,” she said.
Simply having the mindset of being more of a teacher and less of a salesperson can help mortgage professionals distinguish themselves from the competition. This hands-on, empathetic approach can help generate what every MLO is after: more word-of-mouth business and repeat customers.
Tip 3: Leverage Technology and Automation
Work smarter not harder, right? Multitasking is all but a job requirement for MLOs and processors alike. Luckily, various technologies have streamlined and expedited the mortgage process. For Ana T., a wemlo processor, using a centralized platform for her tasks, documents, and communication with both borrowers and MLOs has made a massive impact on her day-to-day operations.
“Working with a smart system that identifies necessary documentation for each loan type makes the entire transaction flow more smoothly. For example, self-employed borrowers require a profit & loss statement. I use the wemlo platform to send out a task to the loan originator to request the profit & loss balance sheet right away from an applicable borrower, so this required document doesn’t become a speedbump in their mortgage process.”
It is clear that technology stacks will become increasingly important to the mortgage industry. In fact, it would be challenging to find a lender who doesn’t believe that technology can help improve the mortgage application process with 70% believing it can reduce the time it takes to close on a loan.
Preparing for Success
Moving swiftly and precisely to secure the coveted CTC is a surefire way to help create customers for life during every borrower transaction. Between volatile interest rate fluctuations and increasingly high customer expectations (thanks, Amazon), one thing is abundantly clear – MLOs are going to have to hustle to win business in 2023 and beyond. But with patience, humility, and a tech advantage, that hustle can be a walk in the park (or backyard of your borrower's new home).