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Even with all the fintech advancements that have been introduced to improve the borrower experience, we are still far from “push button, get mortgage.” On the front lines of lending, loan officers (LOs) would likely agree that one area of mortgage origination that still stands to benefit from more automation is document processing.
The sheer volume of both documents and market activity combined with continuous rework of human-error creates bottlenecks in throughput. Everyone is always left waiting for someone else.
Loan officers receive borrower documents in dribs in drabs. It’s just the way it is. Even the most eager borrower must make time between work and family life to send them. While front-end borrower portals and direct connections make it easier to submit documents electronically, there’s still a tremendous number of documents changing hands.
Furthermore, loan production is often held up waiting for a near complete set of documents from the borrower. When LOs finally hand off borrower documents, loan processors often manage their queue of incoming loan packages on a first in, first out basis. Loan officers are then left jockeying for a priority position against other loan officers’ packages in the queue.
Many small to mid-size lending organizations have processers using stare and compare methods to prep data and documents for underwriting (which, by the way, is yet another department with people centric processes). In more “advanced” organizations, some level of base OCR technology is doing a limited amount of precursory data extraction, primarily on highly structured documents, before processors take it to completion. Manual workflows, as we all know, are slow and result in inaccuracies. Going one step further, if a document turns up missing, the processor must ask the LO to go back to the borrower for just one more thing and again everyone waits.
What if loan officers could take more control of the processing using a “digital assistant” to create a better borrower experience with greater speed, accuracy and efficiency than ever before?
New real-time, in-line, automated document processing digital assistants are becoming reality.
Upon receipt from the borrower, these emerging tools allow LOs to upload documents for immediate classification and data extraction right from a web interface. Or for more sophisticated organizations, API integrations could be built between a lender’s point of sale system and these new doc processing tools to facilitate an instant data exchange. Either way, no more waiting for a complete set of documents to move into processing.
These digital assistants are also likely to leverage highly trained machine learning and intelligent data extraction technologies to greatly expand accuracy, the amount of documents that can be classified and the number of data elements extracted using automation.
These benefits can also support a more fluid production flow. Loan packages can continue to build as more documents come in from the borrower. LOs get complete visibility of the status of their pipeline right within the tool. These pipeline views can also extend to traditional processing channels (loan officer assistants and/or processers) for them to help manage doc processing overflow LOs cannot get to.
If exceptions are present, automation is capable of identifying these in real-time so they can immediately be resolved by the LO directly in the system. Once cleared, the LO or an external API client can export the documents and data for underwriting.
Furthermore, by putting digital assistants like these in an LOs hand they can:
- Prioritize borrowers. More time sensitive loans or more complex loans that might require a longer time to underwrite can be moved ahead in the queue.
- Eliminate downtime. LOs and processors can work together to handle the volume of incoming documents to help get loans into underwriting more quickly.
- Make processing easy. Within seconds capture what’s needed and efficiently move it into underwriting.
LOs managing doc processing might sound like a bit of a paradigm shift in the way we traditionally think about loan origination, but technology is enabling more self-service opportunities to distribute work across staff seamlessly and improve efficiency such that both borrower and loan officers benefit in the end.
Learn more about LoanLogics new doc processing technology for mortgage loan production, LoanLogics IDEA OnDemand.
