Technology is taking the mortgage industry by storm. Mortgage applications are increasingly becoming paperless and digitization of documents using pattern recognition software is now becoming the norm. Intelligent OCR technology is helping underwriters with quick and easy verification and their decisions are increasingly based on automated rules engines. Property values are established in the matter of hours using automated valuation models without the need to wait for physical inspection.
As per a recent study, as many as 50 % mortgage lenders are viewing technology as a means to gain competitive advantage in terms of costs. In fact, more and more lenders are looking at using advanced, AI-based, intelligent document capture techniques like fixed form extraction and database look-ups which can enhance OCR capability. Another mortgage study pointed that 55% of lenders do not use built-in document management systems available in their LOS and are instead opting to use a specialist technology service provider. The need of the hour is technology that adapts to the business need and changing requirements.
What about the high cost of using such advanced technology?
High cost of proprietary technology or custom-built solutions is a challenge and often prohibitive enough for the smaller players to keep going with the manual and error prone status-quo. It is difficult to extract positive ROI from investment in custom built technology and the long timelines involved present another set of daunting challenges. In this scenario “technology-as-a-service” is the delivery model that ticks all the right boxes.
Russ Daniels of HP, famously declared, way back in 2009, that the future of technology was going to be ‘Everything as a service’. He has been proved right multiple times over. The ‘as-a-service’ delivery model now is transforming the way businesses use technological solutions. And the mortgage processing industry is no exception. Whether it is Software-as-a-Service (SaaS) or Technology-as-a-Service (TaaS), on-demand delivery models are being preferred by lenders over the traditional physical or on-premise custom-built technological solutions.
Benefits of using technology-as-a-Service:
- Low or Zero upfront investment: Technology-as-a-Service means that organizations do not need to invest large amount upfront in buying out software platforms or licensing expensive technology products. They pay only for their current use and can seamlessly scale up or down the technology spend depending on the business need.
- Leaner operations teams: Legacy technology solutions bear the burden of having large IT teams to operate, manage and support the infrastructure for that technology. With Technology-as-a-Service, this operational investment is the responsibility of the service provider, leaving the organization’s teams much leaner and making day-to-day operations a lot simpler.
- Quicker and simplified implementation: Technology-as-a-Service is much more simplified and quicker to implement than the legacy on-premise software products. Also, it can be easily integrated with other technology services or platforms using standard web-based APIs. Hence, organizations can be more agile and respond to market forces rapidly.
AI and ML: Lending technologies of the future
A large component of the total cost of mortgage processing is incurred due to labor-intensive, manual and repetitive processes. This cumbersome effort can easily be automated, thereby reducing the cost to the end-customer as well as eliminating human error. This also frees up human resources to work on high value tasks that require creativity and strategy.
Leading technology trends including AI / ML (Artificial Intelligence / Machine Learning) and advanced data analytics are expected to make the most impact on the mortgage and lending ecosystem. These technologies can play a big part in streamlining workflows, improving accuracy and reducing turn times in the lending industry.
In order to remain competitive in today’s fast-changing lending climate, it is imperative for lenders to partner with technology providers who can offer them AI/ML technology as a service and make their operations leaner, more efficient and cost-effective.
Visionet Systems, a domain expert in the mortgage industry, offers its cutting-edge AI/ML based technology in a unique zero upfront cost technology model (also known as ‘pay-as-you-go’ model) that helps you reap ROI from day one.
With technology products from Visionet, you can be sure that you are using the best, specialized mortgage technology without incurring any upfront cost. It gives you the flexibility to pay variably depending on the usage. In this fluctuating market scenario, this can make your operating costs predictable and eliminate the technology risks simultaneously.
Alok Bansal is Managing Director of Visionet Systems Inc. and has 21 years of experience in managing strategy and global BPO operations. He excels in optimizing and leading the growth of financial services companies who are looking to take their mortgage operations to the next level.