By Chris Roberts, Bryan Caffrey and Paul Gigliotti
The digital mortgage might be good for the mortgage industry, but some predict it will cause the demise of originators, realtors, appraisers and others.
That is far, however, from a foregone conclusion.
To be sure, the digital mortgage is on the front of everyone’s mind. Digitizing the origination process, replaces employees with technology--and efficiency gains will be dramatic. Bottle necks will be removed, processes will be faster, and costs will be reduced.
Those are worthwhile objectives, but it’s not clear that borrowers are willing to use, much less embrace automation, at the expense of having professionals to work with.
While they might be willing to fill out an online application, borrowers overwhelmingly express a desire to have access to a human, someone who can guide them through the often-confusing origination process. In fact, 70 percent of borrowers said they wanted access to a professional who could answer questions, or resolve problems, according to a report from Accenture.
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Bryan Caffrey[/caption]
So, the demise of originators, realtors, and appraisers it seems, is exaggerated; though what the optimal balance between automation and humanity will be hasn’t been determined. There is little disagreement that borrowers want access to a human, someone to provide some hand holding, to educate them on the process.
Rather than being a threat, automation is a tool designed to support originators, one that frees them to have more meaningful relationships with borrowers; it enables them to sell more loans. Agents will be able to sell more homes and appraisers will be able to complete more appraisals.
Technology ensures loan officers can focus on building relationships, and leaves collecting and copying a pay stub to operations staff. The deployment of technology, moreover, is an efficiency play, that frees originators and other professionals to devote more time to serve as advisors and develop sustainable relationships with business partners.
It isn’t necessarily a ploy to replace professionals with automation.
They need to drive the use of technology, not the other way around. Few will argue that automation and process changes have to occur because the mortgage business is archaic and lags other financial-service sectors. But it will support them, not disintermediate them.
That’s because technology frees professionals to perform high-value tasks: Loan originators can go with realtors to open houses and discuss finance options for the homes they see. They can focus on relationships and closing sales. Or if they meet with a borrower, documents don’t have to be picked up and brought back to the office. Instead, the documents can be uploaded to a loan origination software, and the loan originator can take the client or the realtor out to dinner.
The aim is to replace time-consuming, manual tasks like picking up documents with more meaningful interactions that build a relationship based on personal relationships. The expertise of professionals, and the quality of their service, is why the consumer selected them--not because they had the lowest rate.
Staying relevant requires showing personal relationships are more powerful than an automated experience. Quality human interaction will enable a higher level of customer service than automation can ever hope to provide. But the assumption is technology has to be embraced at the exclusion of human relationships, but that’s not the case.
The aim is for professionals to expand their skill set and broaden capabilities of teams as well as maintain excellent relationships. If they do that, they won’t have to fear the adoption of automation, because they would have improved the lending experience for consumers, and in the process, preserved their careers.
About the Authors: Bryan Caffrey, the CEO of Arivs, a national appraisal management company with local branches strategically located in over 20 mortgage markets across the U.S. Email Bryan atThis email address is being protected from spambots. You need JavaScript enabled to view it.. Chris Roberts, national sales and support director of Arivs, implemented the company’s national-local strategy, recruited and trained staff for local offices and expanded the services the company offers. Email him at This email address is being protected from spambots. You need JavaScript enabled to view it.. Paul Gigliotti is the executive vice president of operations for the West Coast Mortgage Group. He ensures that the operations team operates at optimal efficiency, trains and mentors new sales people, and negotiates with investors. Email Paul at This email address is being protected from spambots. You need JavaScript enabled to view it..