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In a recent member survey by the Lenders One Mortgage Cooperative, more than 68 percent of mortgage banker respondents said the top challenge they face in preparing for the new TILA-RESPA Integrated Disclosure rule is the impact on processes and workflows that are now required to meet a three business day window for delivering a loan estimate. Forty-four percent said that the technology necessary to manage quality control and stay compliant is the area of the loan origination process most in need of improvement. Lenders One is a national alliance of community mortgage bankers, correspondent lenders and suppliers of mortgage products and services representing nearly 17 percent of the U.S. originations market in 2014. Lenders One is managed by Mortgage Partnership of America, a subsidiary of Altisource Portfolio Solutions SA.
“Although very important, investing in technology alone won’t solve all of the challenges facing mortgage bankers as they work to expand their businesses against the backdrop of new regulatory requirements coming in August,” said Jeff McGuiness, chief executive officer of Lenders One. “Respondents also recognize that process improvement is core to propelling growth and achieving compliance with the new regulations.”
The Lenders One member survey also generated a number of additional findings. Forty-eight percent of respondents said more online and/or mobile access to track documentation for borrowers is the most important element to help streamline the loan lifecycle process for customers this year. This was followed by nearly 32 percent that cited improved electronic communication with borrowers as most important, and another 20 percent that identified easier pre-approval for mortgages before house hunting.
Respondents also reflected concerns about what might be keeping home owners from refinancing their mortgages, recognizing that there has been some uptick in activity. Answers were divided between three categories:
►The initial costs of refinancing: 39 percent
►Lack of confidence in their near-term and future financial situation: 31 percent
►Unsuccessful past attempts to refinance: 29 percent
Recognizing that Millennials are the next major cohort of home buyers entering the market, lenders believe there are three leading elements for attracting this new generation:
►New, more streamlined approaches to originating their loans: 40 percent
►Lower downpayments: 33 percent
►More efficient loan processing leading to less paperwork: 27 percent
The survey had 100 respondents and was conducted at the Lenders One member conference held in March 2015. Respondents consisted of Lenders One mortgage banker members, preferred vendors and national program participants. All findings are available upon request by contacting Lenders One.