Real-Time Opportunity Moving Mortgage Industry Towards Automated Processing
Your Guide to Automated Mortgage Processing
Mortgage Process Automation Primer Main
Primary Factor 1 | Cost Reduction
Primary Factor 2 | Real-Time Opportunity
Primary Factor 3 | Processing Equilibrium
Primary Factor 4 | Scalability
Real-Time Opportunity with Automated Processing Solution
Real-time opportunity is another motivating factor for mortgage-related companies to move towards an automated solution. There is a real-time nature to many mortgage-based opportunities and an automated mortgage processing solution can allow a company to better respond to such opportunities.
For example, consider a mortgage insurer who needs to analyze a loan application in order to provide a rate quote. Chances are that several potential lenders have considered funding this loan application (e.g., application was through a Web-based portal like Lending Tree) and that each potential lender has a very limited time window to analyze the loan and assess its value, risk, potential, etc. Accordingly, each potential lender has likely asked for several quotes on mortgage insurance. The insurer that responds the quickest with a rate quote in line with expectations will often get the business. So there is a definite need to analyze loan applications in near real-time by both lenders and insurers.
Motivation for Mortgage Process Automation
Evaluating and pricing mortgage-backed securities (MBS) is another example of a mortgage-related opportunity that is very time-sensitive and motivates moving to an automated, real-time solution. A mortgage-backed security is defined as an asset-backed security that is secured by a mortgage or a collection of mortgages. The mortgages are sold to an entity (e.g., investment bank) that securitizes or packages the loans together into a security that investors can buy. The value of this MBS is determined by analyzing the collection of mortgages it contains. A financial institution that can reliably and accurately evaluate the value of a mortgage in near real-time has a strong advantage.