Information Management’s Kevin Wack highlighted how Banks are failing to modernize their mortgage application process in his article entitled “Banks' struggles in mortgage business linked to outdated technology.” While Mr. Mack’s article more generally encompasses how banks are failing to apply their overall digital transformation initiatives to the mortgage business and losing in the marketplace, his points about the technology gap dovetail with a webinar Pitney Bowes recently held titled Make Your Mortgage Lifecycle More Efficient With A Single View Of Property.
Applying for a mortgage is one of the largest financial transactions any of us will undertake. Yet why is it that when we first engage with a lender, they have only a cursory understanding of the property we want to finance? How is it possible that weeks into the application process, new details can come to light that cause the mortgage application to be suspended altogether?
One reason is that lenders are failing to bring all relevant data – in fact a Single View of Property – to the places in the mortgage lifecycle that matter the most – and they are paying for it. They invest in generating demand and offer the wrong mortgage product initially, causing them to scramble when the underwriter kicks it back for mundane reasons such as the property was within 300 feet of a gas station – prohibited for an FHA loan – totally avoidable! Now the lender has wasted marketing dollars, the underwriter’s time, and burned the relationship with a potential new customer who will take to social media and blast the lender’s service, causing a loss of additional business.
This is a Big Data issue – banks need to get with the times and get the data in the hands of the people who need it – the initial consult with a prospect should be well informed, whether in person or digital. All details about a property should be transparent in every step of the mortgage lifecycle. A business that allows itself to be “surprised” shouldn’t be surprised by poor business results and tech savvy competitors who eat their lunch.