The US housing crisis from 2006 to 2009 changed how banks approved their mortgage loans. They’ve become stricter with the approval of these loans. Before the housing issue, the average borrower paid 20% of their down payment. Today’s borrowers only pay 5%, which has a significant impact on a mortgage lending business’s profit and operational costs. Can mortgage processing be done at a lower cost such that the lender or bank can focus on improving their services within these circumstances?
Outsourcing removes the burden of mortgage processing and other time-consuming related tasks on a lending company’s theme. Lenders aren’t the only ones to benefit from outsourcing mortgage processing. Both small and big banks, as well as mortgage brokers, can also seek help from a third-party service provider. These smaller companies can save more money by outsourcing a portion of or all their mortgage processing if need be. So how exactly will mortgage processing improve when outsourced?
1. Faster Customer Satisfaction
At the end of the day, you’re still servicing a customer with whom you build a relationship with. Outsourcing your loan processing tasks gives your core team time to focus and improve on customer relationships. The third-party service provider has all the time to go through your back-office tasks, which ensures the stability and error-free execution of your mortgage loan processing. At the same time, you can invest more time and money into marketing your company’s services and checking in on your customers’ needs.
2. Sharpened Focus on Company Management
With an expert on your side doing the mortgage processing, your company’s managers can spend more time on developing and improving your business. They can continue strategizing the business’ goals and reviewing their current performance. They can also focus on the developments around housing and the market in which they can expand to housing loans.
3. Better Access to the Latest Technology
Mortgage processing is high-volume work and requires an incredible capacity that the latest technology can handle for faster turnaround. However, both small and big lending companies and banks may want to save on the money spent on such technologies. An outsourced company would have the budget and capacity to handle and use the latest software and other digital tools for loan processing. Both the human and digital capabilities are bundled in the service you pay for, so no need to buy the software directly and shell out money for upgrading the said technologies.
4. Faster Turnaround Times
Market demand requires lenders and banks to upgrade and change their product portfolios on a regular basis. The cyclical updates spread out the capacity of lending companies to market, sell, and process several products at a time. The turnover and updates end up lessening the chances for accuracy in processing the related loans. The company is more focused on meeting their targets, rather than processing the product itself. Outsourcing lets you share the demand and labor with an expert in loans. You can focus on the targets and deadlines, while the provider ensures that the accomplished product loans fall through your pipeline.
5. Gain Access to Big Data Analytics
Financial companies are harnessing the information and insight from big data analytics to improve customer satisfaction. Big data analytics also increases efficiency in mortgage processing. But big data is expensive and not all small businesses or banks can afford the technology and expertise needed to utilize this resource.
A provider that uses big data analytics can provide information on the number of loans you should approve, mitigation techniques that can be incorporated, and fact-based pricing models. The result? A significant increase in profits and your customers reporting more satisfaction.
Infinit-O is a trusted F&A solutions partner that can help you build and operate a dedicated team of accounting professionals of every level including certified public accountants designed specifically for your unique needs, with cost savings of up to 70%. We can help you meet your goals, whether they be growth, better productivity or simply bottom-line cost savings. With access to excellent talent who use cutting-edge technology, we provide some of the best strategic solutions for your business. We are ISO-certified and GDPR-compliant, so your company and client data are safe with us.