How Mortgage Automation Solution Can Streamline Your Lending Process

How Mortgage Automation Solution Can Streamline Your Lending Process The mortgage industry involves a lot of manual work, from document processing to loan application organization. It often results in costly errors and time-consuming, redundant processes. Reliability on legacy systems and the absence of modern technology can do more damage. What most mortgage lenders fail to understand is that the key to a streamlined lending process, better customer experience, and effective communication is to embrace digital transformation.

Mortgage automation solution is the need of the hour for mortgage lenders to thrive in this digital world, cater to tech-savvy clients, meet the changing customer expectations and stay relevant. According to a McKinsey report, Artificial Intelligence (AI) solutions in the global banking sector are expected to deliver up to $1 trillion additional value every year. This clearly indicates that in this rapidly evolving digital landscape, banks and commercial lending institutions need to spend their time and budget on mortgage automation solutions. They can come in handy to overcome major challenges and streamline business processes.

In this post, we have shed light on how mortgage automation solutions can help you transform your lending process.

What Is Mortgage Automation Solution?

Mortgage automation involves RPA (robotic process automation). This AI-based software can effectively perform repetitive, rule-based tasks while interacting with various IT systems at the graphical user interface (GUI) level. This software digitizes the overall mortgage loan experience, right from origination to closing and servicing. Since the mortgage industry is predominantly process-driven, an automation solution is an ideal addition to mortgage lending processes to improve efficiency and reduce costs.

5 Ways Mortgage Process Automation Can Benefit Your Loan Process

1. Reduced Loan Processing Cost

Automating the mortgage loan processes results in the involvement of fewer staff members. Since robots will be handling, processing and organizing loan applications, your team can spend their time and other resources on complex and more productive tasks. Also, with AI-based chatbots, you can offer 24/7 support to your clients without hiring new people, spending resources on training them or managing

work when they’re on leave because the system will take care of the bulk of work without asking for a raise. When the loan document handling process is automated, it can help bring down the cost per loan.

Isn’t it great?

2. Paperless Loan Processing

Paper-laden mortgage loan closing is a thing of the past because when a lot of paperwork is involved, an unnecessary delay is inevitable. A traditional mortgage lending process might take around seven to eight weeks, thus making the legacy system time-consuming and risky. With mortgage automation, you can leverage disruptive technologies by embracing hand-scripted signatures, digital loan documents, and online transactions. Not only does it significantly reduce the closing cycle but also makes the borrower happy with your quick services.

3. Improved Customer Experience

Better customer experience is the key to the success of any business. And, an effective way to make customers happy in the mortgage industry is to offer a quick and streamlined mortgage process. Natural Language Processing (NLP), a subfield of AI, is an excellent tool that helps in interacting with customers in the language they understand and offer a more personalized approach while delivering more accurate responses. NLP-enabled chatbots interact with customers in the language of their choice without human intervention and help in getting actionable insights from unstructured data that can be used for predicting customer behavior to offer better services.

When you embrace mortgage automation, the solutions allow you to leverage NLP for capturing and routing new leads, intuitively automate loan fulfillment and servicing, and provide around-the-clock services to your clients.

4. Compliant Mortgage Process

Fulfilling mortgage lending regulation requirements, like flood zone determination, HMDA filings, RESPA GFE and HUD-1 disclosures, is imperative for every lender. If you miss one, you might end up in trouble.

Your best bet to developing a compliant mortgage process is mortgage automation. With RPA integration, you can create a compliant process from scratch. The underwriting documents are automatically organized as per the needs which comes in handy for compiling income records, credit reports and tax returns. And, when all the compliance documents are in place, you can concentrate more on the analytical part of the mortgage closing.

5. Improved Accuracy

Errors are the biggest drawback of the manual approach. Borrowers can fill their applications incorrectly; case handlers can make mistakes in data entry, and underwriters can miscalculate. No matter how small the error is, it can make a significant impact on both the borrower and the lending organization. Thanks to mortgage automation solutions, you can increase accuracy levels and reduce the chances of errors.

Although AI is not error-free, it is relatively more accurate than humans. Humans doing repetitive and mundane tasks are prone to making errors whereas automation makes decisions and completes the task without emotions and exhaustion, thus ensuring accuracy.

RPA has the potential to transform and accelerate many processes. Since the mortgage industry is

process-driven, banks and commercial lending institutions can leverage automation solutions to reap significant benefits in terms of cost while reducing mortgage processing time. It is advisable to go for a robust mortgage automation platform to upscale your business and stay ahead of your competitors.