So much has changed in the way we do business, not the least of which is how many components have been added to the lender’s technology stack. The need to increase staff to accommodate 2020’s tsunami volume has many mortgage lenders rethinking their tech stack. More specifically, how technology could leave them less exposed to excessive underwriting costs and make them “market ready” for any volume.

The number one complaint we hear is that some tech solutions mortgage lenders bought didn’t provide the lift they’d envisioned…

Transitioning to new technology isn’t always seamless. The number one complaint we hear is that some tech solutions mortgage lenders bought didn’t provide the lift they’d envisioned, leaving them to scramble to hire staff to manage last year’s volume.

There are steps that mortgage lenders should take to avoid the buyer’s remorse that comes with buying technology that doesn’t deliver.

The first step is to fully appreciate the business’ needs. For instance, is the technology a “business-as-usual” integration? If not, it could disrupt to day-to-day business and sabotage meaningful user adoption.

The next, and most difficult step is to make sure the tech solution solves the real problem. While it’s a difficult exercise, lenders must first identify the many, complex layers of risk the potential technology solution should address. This risk typically stems from the inability to automate critical processes, coupled with the reliance on expensive resources.

During this drill down, it’s important to identify if your challenges are a core problem or a training issue. As an example, indexing documents improperly is often a training issue.

If gain on efficiency and reducing costs and cycle time are your goals, your litmus test would be to measure where the tech replaces absolute human dependency and how it better leverages your team’s talent. Does the technology enable every member of your team to consistently work at a high level of expertise, even less seasoned staff? If so, that creates the opportunity to reimagine your processes into a more modern workflow by creating multiple swim lanes as opposed to the standard conveyor belt.

Never stop asking “why?” and “what?”

This also allows critical process functions, like underwriting, to move much further forward in the process without the involvement of the underwriter. There are many key wins in this, including a much better borrower experience. 

Ultimately executives must dig deep to identify core problems before they integrate a technology solution to fix them. Never stop asking “why?” and “what?” Why must I hire more people to manage more volume? What is it they do? What do we really need to automate to augment the work performed by our high-level talent? The answer might surprise you because it’s not task automation.

Finally, who’s helping with the evaluation? People with “boots on the ground” experience can provide the most meaningful and realistic feedback on user adoption. The knowledge transfer from this group of people will prove invaluable during the scale up phase on onboarding.   

The bottom line: Knowledge is power.

  1. Understand the needs of the business
  2. Identify the real problem and be open to learning the problem may not be what you think it is
  3. Incorporate team members with actual experience into the evaluation process to ensure knowledge transfer

My experience at loanDepot taught me that lenders should never stop innovating. To be successful, we should always push boundaries and ask why and how. Also, to test theories, and be open to the fact you may be trying to solve the wrong problem.

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