Patrick McClain: Hard and Soft Savings–How Technology Can Positively Impact Bottom Line
Patrick McClain is Chief Operating Officer and Chief Financial Officer with Austin, Texas-based FirstClose, a provider of best-in-class property & borrower data intelligence and settlement services nationwide. FirstClose specializes in delivering a powerful web app and LOS plugin that is the industry’s first and only home equity and refi tool that offers everything from application to servicing (credit score, valuation, title, tax, flood, closing and recording) on one easy-to-navigate platform.
There is no doubt that technology is shaping consumer expectations. Companies such as Amazon and Uber are dictating the new normal for consumers; from the amount of time it takes to receive information, complete tasks and execute a deliverable, the consumer world has been turned on its ear. Everyone wants things fast and easy, all in a digital format – and if Amazon can do it, why can’t everyone else?
Consumers are concerned about their experience, not with what it takes for each interaction to be seamless. For everything from grocery shopping to mortgage lending, consumers expect the best with ease and efficiency. For lenders, it is crucial to give borrowers what they have come to expect from any other business, and to achieve that, lenders have to stay on the cutting edge.
Technology is no longer an option; it is an integral element. Inefficient, outdated, manual processes can be risky and ultimately end up costing the lender. To combat these challenges, today’s lenders must stay abreast of cutting-edge technology. Implementing such technology, lenders can exponentially increase their bottom line as well as bring unexpected savings and benefits.
Any lender will agree, implementing cutting edge technology positively impacts the bottom line. However, new technology often comes with a hefty price tag, and this cost may deter some companies from making the leap from good to great. But when a company can implement the right solution to fit their unique needs, the positive impact outweighs the initial hit so often associated with new technologies or SaaS platforms.
The first step lenders must take to achieve savings through technology is to identify areas in which they can save. Every institution will be unique to some degree, but there are a few common areas in mortgage lending that cost lenders a good deal of time and money: vendor management, for example. Vendor management eats up time and money like a beast. Identification, due diligence and managing vendors in and of itself could be a full-time job. In its current state, vendor management takes extra time and effort from existing staff members, pulling them away from other tasks. Think of how nice it would be to have a technology that is able to consolidate vendor management, take it off team members and save countless people hours and money.
Beyond just vendor management, saving staff time in any area is always a priority. This is one of the primary justifications for any automation or technology solution: saving people hours. A platform that can consolidate multiple solutions, cutdown on the number of touchpoints and people hours is a win-win for any company. Reducing the number of administrative hours employees are spending frees them up to grow relationships and as such, grow their business. Building trust and relationships can create borrowers for life and strengthens a lender’s reputation with potential borrowers down the line.
In an instant information world, it is critical that lenders can work quickly to serve their borrowers. Working through antiquated and manual processes does not benefit the client or the lender. When considering a new technological solution, it is easy to pull apart the initial costs and decide it is not worth it. But it is important to think about what constitutes “worth.” Is “worth” saving a few dollars and keeping current processes? Or is “worth” staying abreast of the latest technologies, saving time, saving people hours, and providing quick turnaround for clients and team members, and as such, growing and thriving your business?
Ultimately consumers will select lenders that operate how they operate and think how they think. Lenders that use technology to differentiate and improve customer experience will be the lenders of the future, rather than the past.
(Views expressed in this article do not necessarily reflect policy of the Mortgage Bankers Association, nor do they connote an MBA endorsement of a specific company, product or service. MBA NewsLink welcomes your submissions. Inquiries can be sent to Mike Sorohan, editor, at firstname.lastname@example.org; or Michael Tucker, editorial manager, at email@example.com.)