The Case for Digitization
By: Bill Dolan, CMB, AMP
Digitization allows for an individualized customer-focused experience with improved engagement that is often expected but rarely delivered when shopping for financial services products, such as a mortgage. Younger generations prefer digital technology as a self-service tool to meet their needs. The self-service experience must quickly move away from the laundry-list approach for the customer to fulfill their documentation needs, and, must move to a more collaborative and engaging model where information can be exchanged and shared rather than simply supplied by the consumer. Direct sourcing of supporting documentation will become the industry standard for securing essential information. Additionally, the players within the loan process should become active participants in segments of the mortgage transaction, rather than all information being requested and sourced solely through the borrower alone. Participation should include real estate agents, appraisers, and others who will become more collaborative and spontaneous in the transaction. Moving from both phone and email association to other means will allow for a more controlled, clearer communication and stronger cooperation. The primary focus should be to minimize the impact on the customer without sacrificing loan quality and compliance.
The GSEs (Fannie Mae & Freddie Mac) have made great progress in this direction with them aiming to provide faster time to close, increased collaboration with their lenders, better underwriting confidence and reduced risk. Fannie Mae’s Day 1 Certainty initiative provides freedom from reps and warranties through their mortgage and collateral underwriting platforms. These innovations deliver greater speed, simplicity and certainty to both lenders and borrowers. They also promote stronger risk management and greater digitization of data and processes to the mortgage banking industry. Both your homebuyers and the housing finance system will increasingly gain from these digital advances made possible by the GSEs and their lenders.
If your organization is looking to adopt digital solutions and to transition from a traditional mortgage lending model to a digital-solutions-based mortgage model, you may want to start with a Mortgage Manufacturing Assessment (MMA) performed by our mortgage technology, servicing and digital consultants.
To arrange a free consultation, please contact Bill Dolan at (617) 694-2617 or visit our website at www.scapartnering.com and simply complete the form and submit to us.
