Considering lenders just experienced two massive market shifts from historic-level refi volumes and swift increases in rate hikes, what technologies will be most effective in the coming year?
From boom to bust and back again, the mortgage industry is no stranger to economic cycles. This cycle, however, has been a seismic wave of uncertainty due to rapidly rising home prices, increasing mortgage rates and low inventory of homes. Through all this, technology is playing a new role for companies across the board. While mortgage companies are being forced to cut back on their budgets, some are keeping technology investment at the forefront.
Remote work, for example, has become a talent recruitment tool for all businesses, including mortgage companies. As this trend continues, lenders will continue to need automated communications and processes to make sure nothing slips through the cracks. It means creating queues for each milestone that let the consumer and the operations teams know when action is needed, or a file is ready for review. It means integrating CRM systems with loan origination systems with telephony solutions.
In a higher rate environment with tighter profit margins, lenders will need technologies that minimize the number of touches on a loan file and squeeze every ounce of efficiency from origination to closing to reduce per loan costs. For instance, optical character recognition is a maturing technology that could help the industry start automating some underwriting decisions, speeding the process and reducing costs.
Lenders with technologies that help loan officers continue producing will also have an advantage in today’s more challenging environment, especially when it comes to recruiting. Loan officers are fighting for every loan they can get and are demanding better access to data and lead information, and many are actively looking for innovative lenders that can provide them with an edge.
Because mortgage companies are minimizing their spending in some areas, there is a renewed effort from hackers and cybercriminals to try to find companies with weaker security infrastructure. While the ROI might be difficult to quantify, all mortgage lenders continue to need cybersecurity protocols to prevent system downtime and data breaches. The risks—both reputational and legal—are always going to be there.
Proactive lenders recognize the opportunity technology provides to improve communication, increase efficiency and reduce risks to scale their businesses for the future. So, I’ve asked other mortgage technology professionals what technologies they see that will benefit their companies and clients into the next year and beyond.