The Ideal Mortgage System under Dodd-Frank is electronic, automated and built for speed. No errors in underwriting, high efficiency; the system delivers a repeatable, commoditized process that ensures compliance with the latest reforms. Think of a McDonald’s drive-through for the home mortgage. No matter what your location, you know what products to expect. Technology provides the perfect solution for the no-exceptions loan.
In attempting to achieve this standard, large financial institutions have devoted considerable time and money. They’ve reviewed procedural steps, personnel management, document flows and the physical work space to create the ultimate mortgage team environment, physically and virtually, to facilitate efficient mortgage loan processing.
Even smaller banks across the country have invested in automation and technology to improve their margins. Most feel the pressure to be more efficient and improve economies of scale in order to safeguard profitability with lighter volume of loans.
While new regulations will push this commitment to automation further, the majority of lenders are – or will be soon – ready to meet their requirements and prepared to process the bulk of routine mortgage loans. (Those financial organizations who haven’t done the advance work are decidedly behind the eight-ball, but that is a topic worthy of its own article.)
With all this emphasis on speed and efficiency, where will there be opportunity for distinction and innovation in the mortgage lending business? It all comes down to the customer experience. The financial institutions that can figure out how to couple an efficient and optimized loan process with personalized service will win in the future.