Technology and automation are wonderful when it comes to making the job of a loan originator, processor, underwriter, funder, closer and mortgage-document drawer easier and less stressful. Raise your hand if you like that borrowers now have the ability to electronically sign upfront loan disclosures. Most mortgage professionals do.
Today, the mortgage industry has loan-underwriting programs, such as those for conventional loans through Fannie Mae and Freddie Mac, that bring an element of speed and simplicity to the loan process. Maybe something similar will be on the horizon for government loans. Technology makes it easier to input information about the borrower, pull mortgage-related credit reports and run desktop underwriting with instant verification.
Will there be a need for loan originators, processors and underwriters in the future? That is probably a question best answered in another article. For now, it’s safe to say the mortgage industry is embracing automation.
If you have been in the mortgage industry for some time, you will remember the TRW credit report with the thermal paper and the black line on the side that curled up, letting you know the ink is almost out, or drawing up final loan documents on carbon paper with about 25 forms for the borrower to sign that were printed on a dot-matrix machine. Everything that needed to be sent to the lender to check and review was on paper.
So, technology has evolved to make the loan process much more efficient, with much less paper. And that will only improve going forward, making for a better experience when a consumer applies for a home loan.
Technology has cut down on loan-approval turn times. Fannie Mae and Freddie Mac ramped up their property-inspection waivers for both refinances and purchases, saving borrowers time and money on the appraisal process. Don’t forget the time and frustration saved with being able to contact a borrower through text and e-mail versus calling and leaving voice messages.
Mortgage originators can skip meeting clients in the office (although some still like to do that). Instead, they can contact their clients via Facetime and Skype while still maintaining the personal connection of a face-to-face sit-down.
When it comes to marketing, technology has improved client acquisition. Originators can create free marketing with blogs and videos, or spend money on Google search engine placements or social media sites such as Facebook, Twitter, YouTube and LinkedIn.
Now comes the drawbacks of technology and automation. The mortgage industry is still a contact sport — brokers and loan officers need to meet or speak over the phone with borrowers. The process of applying for a loan may be easier but the complexity of the mortgage business — from programs, processes, costs and terms — is still hard to navigate for the consumer.
Technology cannot make up for the experience of those who work in the mortgage industry. The consumer will be lost if you leave it up to them to figure it out. Too many originators allow technology and automation to handle the customer-service and communication role. They are missing out on a huge opportunity to make that personal connection with a client and earn future referrals.
Many originators rely so heavily on technology today that if a server is down, e-mail crashes or the power goes out, they become paralyzed. There are deadlines to meet on purchase deals. Technology’s shortcomings are out of our control, but how people handle it is not.
Everyone knows that technology is here to stay and will improve a borrower’s experience. Mortgage professionals still need to make themselves relevant in the loan process by texting, e-mailing or calling clients with personal status updates.
Yes, it is nice to have those automated updates informing the borrower of their loan status. Don’t use the extra time this builds into your schedule to come in late and leave early. Instead, capitalize on the momentum of technology to build your brand and increase your pipeline.
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Technology works in your favor if you use it properly, especially to make the loan file flow more efficiently or improve your marketing. It will cut costs and make your life more enjoyable. It can work against you, however, if you do not deploy those systems properly, as there are other loan officers ready to take your place and steal your business by combining technology and automation with superior communication and exceptional customer service. Again, this is a contact sport.
Do not lose sight that technology will not replace the personal touch that a phone call makes to inform your borrower of an issue that comes up during the loan process. Making that call will have a more positive impact than an automatic e-mail status update ever will.