With all of the focus on TRID and vendor management over the past several months, it may come as a surprise that regulatory compliance doesn’t top the list of concerns for lenders. A recent National Mortgage News article cites that business growth, not compliance, drives lenders’ technology investments.
This isn’t to say compliance doesn’t faze lenders—it certainly does, because no one wants a hefty fine for ignoring regulations, and the time spent achieving compliance affects growth. It can stall the entire mortgage process as third and fourth parties are rigorously vetted and data is double and triple checked—all while making sure the closing disclosure is accurate and on time, and the homebuyer is happy.
Happy Homebuyers Equal Increased Loan Volume
The CFPB has given the mortgage industry a model for customer satisfaction and increased loan volume with its 2014 e-closing pilot study, which concluded that most consumers prefer a digital mortgage process.
The mortgage lender who understands homebuyer desires and implements appropriate technology to satisfy them will enjoy more return customers, referrals and a solid reputation overall.
But what does e-closing mean, exactly? Storing all loan documents in the Cloud? Emailing PDFs of documents to be filled out? These are digital methods in part, but they aren’t seamless nor enough to prove compliance—not by a long shot.
You might be surprised to learn that ATS has talked to financial institutions small and large that are still using basic spreadsheets to perform vendor management, and recording duplicate and potentially disparate loan data. But there is a better way—one that’s easier, more efficient and lends itself to full TRID compliance. In other words, more profitable.
First-Time Homebuyers Want More Than E-Closings
First-time homebuyers—who represent 32 percent of the overall housing market—are overwhelmingly between the ages of 18 and 34.
These young buyers consistently gravitate not just toward technology, but a seamless experience with the digital world. They aren’t just looking for a mortgage app. For them, customer satisfaction doesn’t rest on the closing table or a combination of technological features, just as successful restaurant service isn’t just about delivering the food on time. It’s about an integrated experience that can create happy customers of all ages, and increase loan volume.
Four Mortgage Customer Service Features That Increase Loan Volume
The complexity and sheer volume of paperwork involved in buying a home is overwhelmingly cited as, well, overwhelming. And frustrating. It’s among the reasons the Consumer Financial Protection Bureau implemented TRID, so homebuyers can understand exactly what they’re buying before they sign at the closing table.
But abiding by TRID, with its rules and forms, doesn’t give your mortgage company a stamp of customer satisfaction. Yes, the new Loan Estimate and Closing Disclosure are easier for homebuyers to understand, but this doesn’t assure that mortgage professionals are communicating to the consumer throughout the process in a clear, transparent manner.
Transparency in customer service requires communicating throughout the process. Setting expectations for deadlines, fees and processes—and expediently updating those expectations when necessary.
And with one digital portal where all verified parties to a loan can see a loan’s status in real-time, transparency can be achieved.
Mortgage Customer Convenience
The easier you make the process, the more customers will enjoy working with you. And the better your technology, the less likely you’ll have to ask for information more than once, correct that information, or explain a protracted process (because it won’t be). Which leads to my next point:
Speedy Loan Process
The two points above point the way to a speedy loan process. With continued low interest rates and now Brexit’s impact, refinancing is at an 18-month high and loan production is going up, up, up. Assuring a whole new wave of customers’ reasonable closing times while achieving TRID compliance could be daunting, but it doesn’t have to be.
Imagine a mortgage process so simple and user friendly that all parties can collaborate on it in real time with little to no training. They could join forces in collecting data, contribute to a transparent process and even invite the homebuyer and homeowner to view necessary documentation as it’s compiled. Talk about a seamless relationship with technology.
Compliance Means Increased Loan Revenue
As mentioned above, growth is currently a greater concern among lenders than compliance. But what if compliance could actually increase yields, rather than draining company resources?
In the current mortgage environment, compliance and production are separate silos, and often at odds with each other. Loan production staff are aiming to increase volume while compliance concerns slow down their efforts. But when they work together with the right technology, they can turn compliance from a cost center to a profit center, facilitating an increase in production volume while driving down costs through gains in efficiency.
Done appropriately, compliance and production departments can be natural partners that achieve greater success, profitability and longevity for their organizations.
Let us show you how.