How digital tools will transform mortgage application processes
The current mortgage process is challenging for everyone involved. For customers, buying a home is likely to be the biggest purchase they will make in their lifetime. The knock-on effect is that the pressure on mortgage providers to deliver a smooth and supportive service is intense, with customer emotions often understandably running high. With technology integrated into so many areas of the public’s lives, customers no longer have patience for outdated processes and clunky systems.
Mortgages are believed to have first been available in Britain in the 12th century. The original concept was that your property would be used as collateral for your debts. Your title would then be returned to you once your debts were fully paid off. The question now is, how can mortgage lenders embrace 21st century technology to solve problems that have their roots in the 12th century? Life can be made easier for both customers and lenders. The answer lies in digital transformation.
What can be done to save the day?
Mortgage brokers looking to provide a better customer experience need to leverage the wealth of digital tools available to help streamline processes and procedures. Organizations need better systems to organize, access, and manage their data. By collecting and analyzing data more accurately, financial institutions can make more informed decisions about what type of mortgage is right for them, accelerating timelines.
We explore four key pillars that 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 driving 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 one specific task. This can lead to disjointed processes. For optimal operational efficiency, a more forward-thinking approach is required. End-to-end solutions that automate manual tasks, data entry, and review/approval routing, plus integrate with other processes and core applications, will create more harmonious operations.
By hyper-automating internal tasks, mortgage lenders can spend more time providing personalized customer service, which will significantly improve the customer experience.
Adopting a robust process orchestration engine is essential to hyperautomation efforts. These tools can bridge the gaps between mortgage origination and other business applications, accelerating underwriting and mortgage review workflows. For example, by using a robust process orchestration engine, an organization can provide a web interface for customers or brokers to submit mortgage applications with supporting documentation.
After the first round of interviews, the organization was able to send data directly to the core banking software and loan origination system for processing, eliminating both manual and duplicate data entry. Giving employees access to real-time information directly from the core banking software could be a huge help in cross-referencing customers’ mortgage and personal information – all from a single interface.
Artificial intelligence
Artificial intelligence (AI) is opening the gates to mortgage heaven. As financial institutions continue to integrate AI into their systems and processes, we can expect a streamlined experience. AI chatbots are becoming increasingly common in financial services, giving customers 24/7 support without wait times. Chatbots can also provide a more guided experience when reviewing forms or navigating websites. Long forms may also be a thing of the past as AI helps to automatically fill out and file documents.
By leveraging AI, financial organizations can also reduce repetitive back-office administrative tasks such as data capture and migration, allowing employees to provide faster customer service.
Cloud adoption
Many financial institutions have historically resisted moving sensitive information to cloud computing services. But as security practices have evolved and cloud providers have invested heavily in advanced threat detection tools, companies are increasingly looking to cloud-based solutions. Moving to the cloud also offers more streamlined, cost-effective software maintenance and security updates.
This will result in improved resilience and continuity for customers. It will also support scalability within the sector, with IT resources 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 fraught with 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 storing data in multiple places.
For example, by integrating an organization’s central source of truth with core banking software and lending systems, mortgage specialists can access real-time information regardless of where it is stored without having to switch applications.
Ultimately, streamlining these processes can also lead to faster underwriting, quicker credit checks, and smoother assessments and approvals – critical differentiators in a rapidly changing real estate market.
A better future
It may not come as a surprise to you that the term “mortgage” is derived from the French words “mort,” meaning death, and “gage,” meaning promise. That’s right—a promise of death. However, things were never as dark as the name suggests, and the chances of things getting better are exponential. Now that the days of faxing information back and forth are long gone, mortgage brokers and banks can begin to offer a smoother mortgage path to potential homeowners of the future.
By leveraging AI-powered tools, customer service agents can quickly retrieve a document or copy of a signature directly from a cloud-based system. As the mortgage industry continues to digitally transform operations, the benefits will be felt by all stakeholders, from employees to customers to shareholders. Innovative financial institutions are already improving the customer experience by using cloud-based process automation tools and integrations.
While it’s not always possible to eliminate every bump in the road, the introduction of digital tools will help make the journey to obtaining a mortgage significantly smoother. And it’s not just customers who will benefit. When lenders are empowered with clear insights and tools that supercharge the way they organize, access and manage data, they’ll be well-equipped to provide more efficient, intuitive services in the years to come.
We have listed the best AI tools.
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