Today’s mortgage process is challenging for everyone involved. For customers, buying a home is probably the most important purchase they will ever make. The knock-on effect is that the pressure on mortgage providers to provide a smooth and supportive service is intense, and customers’ emotions are often understandably heightened. With technology integrated into so many areas of public life, customers no longer have patience for outdated processes and cumbersome systems.
Mortgages are thought to have first become available in Britain in the 12th century. The initial concept was that your property would be used as collateral against your debts and that your title deeds would be returned to you once your debts had been fully paid over time. The question now is: how can mortgage lenders embrace 21st century technology to help solve problems rooted in the 12th century? Life can be made easier for both customers and providers. The answer lies in digital transformation.
What can be done to save the day?
Mortgage brokers looking to deliver a better customer experience must utilize the wide range of digital tools available to help streamline processes and procedures. Organizations need better systems to organize, access, and manage their data. More accurate data collection and analysis allows financial institutions to make better-informed decisions about what type of mortgage is right for them, speeding up timelines.
We will explore four key pillars that will support digital transformation in the mortgage sector.
Strategic Solutions Manager, Financial Services at Laserfiche.
Hyperautomation
Hyperautomation will be key to improving the overall experience and will drive operational excellence within financial institutions. Many banks have already invested in some form of automation, but in most cases single-point solutions are dedicated to a specific task. This can lead to disjointed processes. To achieve optimal operational efficiency, a more forward-thinking approach is required. End-to-end solutions that automate manual tasks, data entry, and review/approval routing, as well as integrate with other core processes and applications, will enable more harmonious operations.
Hyperautomation of internal tasks will allow mortgage providers to spend more time providing personalized customer service, which will greatly improve the customer experience.
Adopting a powerful process orchestration engine is critical to hyperautomation efforts. These tools can bridge the gaps between mortgage processing and other business applications, speeding up mortgage underwriting and review workflows. For example, by using a powerful process orchestration engine, an organization could provide a web interface for customers or brokers to submit mortgage applications with supporting documentation.
Following the first round of interviews, the organization could input the data directly into the core banking software and loan origination system for processing, thereby eliminating manual and duplicate data entry. Providing employees with access to real-time information, directly from the core banking software, could greatly assist in viewing customers’ personal and mortgage information, all from a single interface.
Artificial intelligence
Artificial intelligence (AI) is opening the doors to mortgage heaven. As financial institutions continue to integrate AI into their systems and processes, we can expect a more streamlined experience. AI chatbots are becoming more common in financial services, allowing customers to receive 24/7 assistance without wait times. Chatbots can also offer a more guided experience when reviewing forms or searching websites. Lengthy forms may also be a thing of the past as AI will assist with automatic filling and filing of documents.
The use of AI will also enable financial organizations to reduce repetitive back-office administrative tasks (such as data capture and migration), enabling employees to provide faster customer service.
Cloud adoption
Historically, many financial institutions have been reluctant to move sensitive information to cloud computing services. However, as security practices have evolved and cloud service providers have invested heavily in advanced threat detection tools, companies are increasingly turning to cloud-based solutions. Cloud migration also offers more streamlined and cost-effective security updates and software maintenance.
This will result in greater resilience and continuity for customers. It will also support scalability within the sector as IT resources will be freed up to focus on high-impact solutions.
System Integrations
The next phase of digital transformation for many financial institutions involves integrating core systems to further reduce manual tasks and data entry. The mortgage process is still plagued by cumbersome activities such as income verification and document collection, many of which must be performed multiple times due to a lack of data integration. Connecting systems creates a frictionless experience for employees and customers; meanwhile, organizations can maintain a single source of truth and mitigate the risks that come with having data stored in multiple places.
Integrating an organization’s single source of truth with core banking software and loan origination systems, for example, can give mortgage specialists access to real-time information, no matter where it’s stored, without having to switch applications.
Ultimately, streamlining these processes can also lead to accelerated underwriting, faster credit checks, and smoother reviews and approvals – crucial competitive differentiators in a fast-moving real estate market.
A brighter future
It may not surprise you to learn that the term “mortgage” is derived from the French words “mort,” meaning death, and “gage,” meaning pledge. That’s right: pledge of death. However, things were never as bleak as the name suggests, and the opportunity for things to get better is exponential. Now that the days of faxing information are gone, mortgage brokers and banks can begin to offer a simpler mortgage process to potential future homeowners.
By using AI-powered tools, customer service representatives can quickly retrieve a document or a copy of a signature directly from a cloud-based system. As the mortgage industry continues to digitally transform its operations, the benefits will be felt by all stakeholders, from employees to customers to shareholders. Innovative financial institutions are already improving the customer experience with the use of cloud-based process automation tools and integrations.
While it’s not always possible to remove all obstacles from the path, the introduction of digital tools will help make the process of getting a mortgage much simpler. And it’s not just customers who will benefit. When lenders are armed with clear information and tools that empower the way they organize, access and manage data, they are well equipped to offer more efficient and intuitive services in the years to come.
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