The obvious answer is through the increased use of technology. But, are lenders prepared to invest the time and money needed to implement such technology?
Lenders can continue to do business as they’ve done in the past. Manual handling of:
- Underwriting and approvals
- Post-Closing reviews and delivery
- QC Audits
This can be time-consuming and expensive, requiring more staff to complete each function. As an alternative, lenders may supplement these efforts with new technology making staff more productive, with less cost. More lenders are viewing the use of increased technology as a method of survival in 2018.
According to a recent CC Pace Systems survey, lenders view technology as:
- Competitive advantage – 50%
- Necessary evil – 29%
- Equal parts of each – 21%
Successful lenders know the future is in technology. The challenge is the time, investment, and training needed in bringing in the required systems and automation.
You must find new systems that can integrate with the existing, legacy LOS while communicating with outside sources for consumer information and validations.
It should be rules-based systems with the artificial intelligence (AI) to collect, review, and analyze data to achieve desired results, reduce the need for staff.
You will need technology can communicate and educate consumers, gather and analyze their data, and ensure the quality and compliance of the loans originated.
Let’s face it, if Watson can compete and win on Jeopardy, computers can learn to originate, process, underwrite, and close loans. All with minimal human intervention.
This may seem a little scary. But, the processors, underwriters, and closers of today can be replaced by artificial intelligence, guided robots to handle functions and loans.
As an example, take the new HMDA requirements. Lenders may choose to gather, review, validate, and report the required data elements manually. This will take increased time, effort and people while being prone to mistakes.
On the other hand, since most data is in their LOS and loan file, the data may be automatically extracted from their systems and loan documents.
Through a rule-based system and AI, the information may be quickly analyzed and validated for accuracy and completeness, then prepared and reported to the CFPB as required. All within a matter of minutes not days, with minimal human intervention.
Historically, manual functions like post close/delivery reviews and quality control audits can be similarly automated as well.
Are you using the technology available to automate manual functions? If not, are you preparing to do so in 2018?
You may find that, like 29% of those surveyed, like it or not, it’s become a necessary evil. An investment that will pay big dividends down the road.
Are you ready to compete in 2018 and beyond? I sure hope so. If not, LoanLogics can help.