Q&A With Dark Matter’s Sean Dugan and Mike Piombino: When It Comes to Your LOS (and Vendor), Choose Wisely

An LOS is a substantial investment for a lender of any size and choosing the wrong one may lock you into paying more than you need for a tool that’s not quite right for your needs.

MBA NewsLink recently spoke with Dark Matter Technology’s Sean Dugan, Chief Revenue Officer, and Mike Piombino, Senior Managing Director of Sales, Empower LOS, to get insights from two industry pros who’ve spent decades matching lenders to the LOS that’s right for them.

MBA NewsLink: What features should lenders look for in an LOS?

Mike Piombino: When advising lenders on LOS selection, it’s important to align the choice with the lender’s overall goals, or their “North Star.”

While every lender seeks greater operational efficiency and automation, the level of flexibility and control over the platform is often a key decision point. Some institutions prefer a “set it and forget it” approach, opting for an LOS that covers all essential functions and then adapting their processes to fit the system. Others, however, value flexibility and configurability, allowing for a more automated, exception-based workflow. In this scenario, services are triggered automatically based on the lender’s business logic, and tasks are only sent to individuals when human intervention is required. This approach provides more adaptability to a lender’s specific needs and enables higher levels of intelligent automation, but it requires resources to manage the system.

For lenders without such resources, the more straightforward “set it and forget it” approach is typically the better choice. In the end, even the best tools are only valuable to lenders that can manage and use them effectively.

Sean Dugan: Some lenders should prioritize an LOS that integrates both customer-facing and loan officer (LO) tools. This ensures users can get their work done without switching between multiple systems. If a lender offers specialized loan types, such as construction or assumption loans, it’s essential that the LOS can support these without requiring custom development work. Built-in reporting capabilities are also crucial, as they enable lenders to track valuable performance insights without making an additional investment in costly third-party business intelligence software.

Another key LOS feature to evaluate is third-party service APIs and integrations, such as those with title companies or appraisers. These integrations should communicate seamlessly so that loan data flows smoothly into the appropriate systems—whether it’s a loan servicing system or a core banking platform. Financial institutions may have requirements for the LOS to integrate with their accounting system to handle payments and payoffs. At the application stage, the LOS may also need to recognize returning customers or members and auto-fill their information. 

Finally, support is a critical consideration. Lenders should expect more than just video tutorials; their LOS provider should offer meaningful support without requiring outside consultants to make everything work.

MBA NewsLink: What’s the difference between configurability and customization?

Mike Piombino: The key distinction is that “customization” typically involves actual software development and code changes, which can become a long-term burden. In contrast, “configuration” refers to tools that business admins and analysts can use to meet their specific needs without requiring technical expertise. Our goal is to eliminate the need for development by empowering lenders to reach their objectives through configuration, allowing the business to own the platform versus relying on IT resources. We guide clients through the initial setup and ensure they can continue adapting their system as their needs evolve.

MBA: What drives lenders to change LOS platforms?

Sean Dugan: Most lenders looking to move to a new LOS are reimagining their operations and moving away from a more entry-level platform that isn’t keeping them up with the times. They are looking for innovation to drive their business forward and to receive a greater return on their investment. These lenders want a modern LOS that will leapfrog their business beyond their legacy technology and give them a competitive edge.

Of course, given recent market circumstances, some lenders are looking for change because their LOS costs have increased significantly. They want an LOS platform that will save them money through improved productivity and offer price stability as the market—and their business—picks up speed.

MBA: What technologies will future-proof the lender’s business?

Mike Piombino: A strong foundation starts with an LOS that has established integrations with core systems, a comprehensive network of third-party services, and portals for borrowers, loan officers, brokers and correspondent sellers. This is especially important for lenders operating in multiple channels or those who want to keep their options open for future expansion.

On top of that, an API-first approach is necessary when it comes to future-proofing your business because it helps ensure that evolving technologies can more easily integrate with your core platforms.

Lastly, embracing AI is integral to any forward-thinking strategy. We believe AI is going to provide long-term value for lenders of all sizes by managing labor-intensive tasks for them and allowing their teams to focus on the higher-value tasks that require human attention. It’s important to choose an LOS vendor with a clear plan for staying current with emerging technologies and integrating them into your ecosystem.

(Views expressed in this article do not necessarily reflect policies of the Mortgage Bankers Association, nor do they connote an MBA endorsement of a specific company, product or service. MBA NewsLink welcomes submissions from member firms. Inquiries can be sent to Editor Michael Tucker or Editorial Manager Anneliese Mahoney.)