VIEW BLOG: As with other sectors of the US economy, the mortgage industry has stepped up its investment and digital adoption in response to the COVID-19 pandemic.
With mandates and constraints in place, mortgage lenders were challenged to find ways to continue profitably with a newly allocated workforce. While much attention has been paid to innovative ways in which lenders have improved the borrower-centric side of the business, a number of technological changes and improvements have been made in the back office that will provide lenders with a significant return on investment. for years to come, including the following:
Transition to a paperless payment process with the ability to connect to the network
As telecommuting became the norm, lenders were forced to come to terms with the fact that they still relied on a number of manual, paper-based accounting processes within the company – processes that required people to be in the office for physical control. For example, for accounts payable, lenders can now improve operational efficiency with technology that can electronically “read” emails, automate approvals based on established lender parameters, and then distribute payments through an automated clearinghouse (ACH) or electronically. by electronic means. funds transfer capabilities (EFT).
More control over the process
If the flow of accounts payable documentation becomes easier, the level of control the lender has over the process will also become easier. By automating and standardizing the review and approval process, lenders can better ensure that every transaction is given due consideration. This, in turn, has the added advantage of positioning the lender more favorably for auditing or regulatory review, as a more standardized process reduces the likelihood of errors and simplifies reporting.
Greater flexibility in recruiting and attracting talent
Lenders who have moved to automated back-office operations have the opportunity to fill their teams with the best talent, regardless of geographic location. Today, it is not uncommon to see a lender with a California controller and a Florida account manager working effectively together as if they were in the same office. It is fundamentally changing the way lenders think about growth and talent, and opens up many opportunities for many that weren’t there before.
At the very least, the mortgage industry has established itself over time as an industry based on resilience and the ability to adapt. As an industry and as a nation, we all hope that the effects of the pandemic will subside and we can get back to normal. When that day does arrive, many lenders will find that their efforts to remove costly paperwork in the office will bring even greater benefits in the course of their normal day-to-day operations in the future.
Joe Ludlow is vice president of Irvine, California. Systems advantages, a provider of accounting and financial management tools for the mortgage industry.