NEXT sits down with a top tech exec to get his take on COVID-19 and the mortgage industry
What a difference a month makes. The global COVID-19 pandemic has ignited a sea change in mortgage lending. From social distancing and virtualizing the conference circuit to pushing eMortgage process forward, and in many cases, suspending property visits by homeowners and appraisers alike. The current mortgage world is drastically different than the one that’s currently dealing with the COVID-19 crisis.
NEXT is doing a series of exclusive interviews with market leaders to ask them an important question: What are the three ways the global pandemic has changed mortgage lending?
Our first guest is Rajesh Bhat, the Co-Founder and CEO of mortgage lending platform, Roostify. Here’s his take:
1. The life of a loan officer is forever changed
Loan officers are natively showing a preference for using cloud-based “digital-first” services, and are moving away from their LOSs. But will it be permanent? Yes and no.
With interest rates at all-time lows, the demand for refinancing is incredibly high. In the past several weeks, refinance applications rose 79% and were 479% higher than a year ago, causing lenders and loan officers to scramble to process as many incoming requests as possible. To do this, lenders need to ensure their team and systems are able to keep up.
Some loan officers who have adopted digital tools during the COVID-19 crisis are likely to go back to their old habits after we are past the epidemic. But many others, and I would expect the majority, will see first hand that they are able to preserve the valued high touch experience with their customers using these digital capabilities. Just as people are getting used to Zoom video conferences as a result of COVID-19, one can assume that mortgage salespeople will do the same with digital capabilities.
2. Digital lending provides unintended solutions and continues to evolve
We’ve made great progress creating a truly digital workflow. However, COVID-19 shows us that mortgage lending still needs to evolve.
As an example, the “bookends” of mortgage finance — appraisals at the beginning, eClosings at the end — both are delaying the end-to-end digital mortgage process, yet this is being solved for. We are working to expand our services in order to fulfill the issues being currently faced by lenders, regardless of whether or not we envisioned these problems falling into our wheelhouse. No one planned for COVID-19 and we couldn’t have predicted its impact. So for digital lending to provide unintended solutions, that’s a pretty exciting development.
This is an example of how the tech is evolving, but so are our relationships. COVID-19 really only started to take hold a few weeks ago, though it seems like years ago, and during its onset one large mortgage lender, a client of ours, said they were so grateful they implemented our tech last year. That was a powerful message for me as this indicates how we are all in this together showing that the future is ours to mold, together.
3. People will get used to this life before it is over, and that’s a great thing
At a time like this, we must focus on supporting lenders first to make sure they are enabled for success. As mentioned, we are aggressively looking at digital eClosing solutions and digital appraisal solutions, but we won’t stop there. Once we emerge, it is my hope that the mortgage industry will feel more joined together, as a company, as an industry and as a nation, after so long being kept apart.
I truly believe that we will wind up being much more resilient and attentive to consumer needs. We learned to cater to a captive consumer and as we exit we must preserve that sentiment, and that’s how COVID-19 will change mortgage lending forever.