Applying Automation for Optimal Loan Originating Performance


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Despite efforts to minimize loan origination costs, they remain constant in the origination process.

High loan volumes can mask many production inefficiencies, but the rising costs of recruiting and hiring experienced staff are always present.

Lenders have seen significant inflation in the cost of the right people and the corresponding increase in the cost of recruiting them. This underscored the importance of making the most of an institution’s lending automation, allowing it to do more with fewer people.

As a result, many lenders are now seriously considering the proper application of digital lending technologies and are looking for tools that give them the flexibility to adjust their technology stacks as they see fit with the IT resources they have in-house.

Some might argue that this consideration was due early last year when lenders started investing in technology to deal with COVID-related changes. But a global pandemic is not conducive to careful consideration of options.

Overnight, lenders were forced to work with remote teams and deal with borrowers remotely. Digital lending has become a priority. Many rushed to implement tools that would allow them to continue building business, with only a preliminary consideration of the long-term value of these technologies.

But now, in hindsight, many lenders are reconsidering.

Today, many lenders are operating on bloated technology stacks that are no longer used to help the institution achieve its goals. Today, lenders must consolidate their production systems in order to reduce costs and free up resources that they can use to grow.

Let’s take a look at what successful lenders should consider when undertaking the job of using the most appropriate consumer loan automation.

The main consideration: the borrower

Providing a satisfactory and fully compliant consumer loan origination process has become an industry-wide imperative. With increased competition and regulatory oversight, no lender can afford to operate in any other way.

Accordingly, the first consideration should be the borrowers. Lenders are realizing that today’s borrowers are unwilling to accept a legacy process that does not take their needs and wants first into account. Since new competitors are more than happy to offer such an experience, every lender is now focused on doing it.

But what is a satisfying borrowing experience? Since different lenders serve different segments of the industry, there is no single answer to this question. In fact, many loan officers will tell you that there is often little consistency in the needs or wants of the borrowers they serve.

This means that lenders must use technology capable of supporting a range of processes for different types of loans and borrowers. This isn’t to say that lenders should do everything differently, just that they should have the power – and the ability – to orchestrate their various workflows as they see fit to achieve both efficiency and effectiveness. borrower satisfaction.

The critical factor: ease of configuration

When COVID struck and lenders were forced to send their workforce home and start coming from their borrowers remotely, many went in search of technological solutions to address these immediate problems. This is exactly what they were supposed to do at the time.

As a result, many lenders found themselves with new technology that was only effective in solving one problem. The rapid increase in point of sale (POS) technologies available in the market is a case in point. As a result, lenders were able to interact effectively with borrowers online and via social media.

Today, our modern consumer loan origination (LOS) system technologies have integrated full point-of-sale capabilities, eliminating the need to connect these external tools to the lender’s database. At the same time, we see point of sale providers working to transform their platforms into more than point solutions, but with limited success.

The added benefit that these modern consumer origination technologies provide is configuration flexibility. In the past, when lenders relied primarily on their technology vendors to make changes to their platforms, flexibility was typically offered to lenders.

Today’s loan originators want technology they can easily configure from point of sale to close and beyond. This allows the lender to decide on the appropriate use of automation for any loan product or workflow they wish to design.

This gives lenders the ability to quickly create new workflows that allow them to move quickly to compete in new market conditions.

In today’s changing buying money market, lenders must be able to manage multiple loan products delivered through multiple channels by smaller teams. Lenders want the power to make the adjustments they believe will allow them to achieve that goal, without needing the help of a third party.

A certain skill set and knowledge of both the technology being used and the goals of the lender will always be required. But, modern origination technology finally allows the lender to determine how they will use the technology to optimize the loan origination process and overall success.

The impact of good automation

The right lender automation solution offers many benefits. First and foremost, borrower satisfaction is higher. More than anything else, it will help a lender to be more competitive in an increasingly competitive market.

But the right tech stack also has the potential to impact efficiency. Higher efficiency means on-time shutdown and lower overall origination costs. But it also means that the lender has more flexibility to provide better customer service.

There has long been a view that you can either be efficient or have good customer service, but it’s actually a balancing act that the smartest lenders use to differentiate themselves from the competition. Effective lenders who use the right technology can easily tailor their workflows to the needs of different borrowers.

The orchestration of workflows is a game-changer. Orchestration provides lenders with highly efficient, specialized workflows to deliver higher levels of borrower satisfaction.

Get everything that technology is supposed to offer

The traditional approach to loan technology, just like offerings in many other industries, has been that while you may have a great product, a great price, and great customer service, the buyer can only choose two. .

But today, consumer origination automation tools are capable of delivering everything modern technology has long promised. But this is only possible if a clear thoughtful approach and good process design are used to choose the right automation solution.

Gone are the days of overlaying / pinning a POS on top of a LOS to solve a problem. It is a smarter use of technology and an appropriate application of automation. Lenders who incorporate this strategy to implement the technology will be more successful now and in the future.

British Barker British Barker

Brit Barker is SVP Sales, Enterprise Solutions for Origence, based in Irvine, Calif., A brand of CUSO CU Direct.


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