Clint Salisbury of Wolters Kluwer: Improving the Lender Experience with Digital Mortgage Innovation
Clint Salisbury is a Senior Sales Representative with Wolters Kluwer Compliance Solutions. He previously was with International Document Services, which was acquired by Wolters Kluwer in April. He served in several roles at IDS over 13 years, including sales and marketing, product implementation and as in-house counsel. Prior to that he served as an associate attorney with several law firms in Salt Lake City, Utah.
It’s often said that there’s no such thing as a truly selfless act. Even performed anonymously, an altruistic act will leave the doer with a feeling of accomplishment or self-satisfaction. This is probably a good thing because if doing something nice for someone else didn’t even make you smile, would many people even see the point? This is why the best relationships work when there is a balance of benefits.
I recently argued that lenders should not sacrifice the borrower experience for the sake of digital mortgage innovation. Instead, I encouraged lenders to expand their hybrid eClosing capabilities and efforts to better serve their borrowers. After laying out that argument, I have felt it prudent to also articulate the benefits of hybrid eClosings to lenders, especially since the most prevalent counterargument to eClosings is the loan officer’s desire to attend the closing with bottles of champagne or fresh baked cookies for the borrower in celebration.
The benefits of hybrid eClosings – streamlined processes, greater operational efficiency, reduced errors, etc. – have been touted so frequently and for so long that they’ve almost become rote. Yet 61% of lenders did not book a single hybrid eClosing in the fourth quarter of 2021.[1] In addition to the operational benefits realized by implementing hybrid eClosings, the borrower experience and satisfaction gains also make a significant impact.
First impressions are important, but last impressions can have a bigger impact. The closing ceremony is often one of the borrower’s last interactions with the lender, making it one of the most important steps in the mortgage process in relation to the borrower’s experience. Like a sports team leading the entire game only to lose on the final play or a buzzer-beater, lenders can provide excellent customer service throughout the mortgage origination process, only to drop the ball at the closing ceremony and end up with an extremely low Net Promoter Score (NPS).
For example, when there’s an issue at the closing ceremony, the lender’s NPS drops an average of 65 points.[2] What’s more, borrowers who receive inaccurate closing documents, even if the error was clerical like a misspelled name or street address, typically rate lenders with an average NPS of eight. Just to be clear, that’s an eight out of 100, not an eight out of 10.
For lenders looking for more reasons to move their closing ceremonies from table to tablet, 60% of borrowers reported that they were influenced in their choice of lender by whether or not the institution offered online portals for signing and notarizing documents.[3] Additionally, 82% of borrowers who secured a mortgage in the past two years say they would have signed and notarized all closing documents electronically via video interaction if they could do so.
With today’s borrowers increasingly focused on a streamlined closing experience and less than 21% of borrowers simply choosing the lender offering the best rate,[4] offering a hybrid eClosing ceremony can serve as a competitive advantage for many lenders. As the market becomes more purchase-heavy, lenders will need to ensure they are making every effort to separate themselves from their competitors to attract borrowers and referral partners.
In addition to the operational and borrower experience benefits that hybrid eClosings can provide, there are also financial benefits. Mortgage lenders can save over $150 per loan with hybrid eClosings and average a 7.73x return on investment (ROI).[5] With cost savings also reaching settlement agents, hybrid eClosings benefit all parties involved.
One of the more popular counterarguments to eClosings is the loan officer who wants to attend the closing. Hybrid eClosings aren’t meant to cut off contact between the borrower and the loan officer. Rather, they enhance the borrower experience, and there are plenty of ways for loan officers to make a hybrid eClosing special.
The benefits of hybrid eClosings can be seen throughout lender operations, leading to financial benefits and a not insignificant ROI. However, some of the biggest benefits are still seen through the eyes of the borrower, and borrowers know it. That is why today’s borrowers are making it clear that digital options are a preferable choice, and lenders need to be sure to offer those options from the start of the loan process to the eClose.
(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 msorohan@mba.org; or Michael Tucker, editorial manager, at mtucker@mba.org.)
[1] https://www.stratmorgroup.com/as-the-mortgage-market-turns-lender-perspectives-on-the-2022-market/
[2] https://www.stratmorgroup.com/navigating-last-minute-loan-process-volatility/
[3] https://static.icemortgagetechnology.com/pdf/ebook-borrower-insights.pdf
[4] https://www.mckinsey.com/industries/financial-services/our-insights/banking-matters/competing-on-customer-experience-in-us-mortgage
[5] https://info.notarize.com/rs/624-MLH-882/images/The%20ROI%20of%20eClosing%20in%20Real%20Estate.pdf
