5 Proven Ways to Make Mortgage Loan Processing More Efficient & Time-Bound

Mortgage Feb 25, 2022

Mortgage processing today continues to be slow, unorganized, and labor-intensive. As a result, it is struggling to scale up to meet customers’ expectations of a fast and seamless digital borrowing experiences. The direct fallout of this is losing customers to competitors. An inefficient process is also responsible for generation of faulty loans. Such loans find no takers in the secondary market and lead to losses. Therefore, to stay competitive lenders need to focus on making mortgage processing fast, efficient and error-free.


However, transforming mortgage processing is not an easy task. This is because the process of determining customer creditworthiness is complex and factors in a lot of considerations. Underwriters and loan officers need to scrutinize several documents to take the final lending decision. Further, any change brought about to mortgage processing, must be in compliance with mortgage regulations.

5 Expert Tips to Transform Mortgage Processing

Here’s a look at 5 ways advised by mortgage industry experts that can bring transformational changes in mortgage processing to generate better customer experience.

Set Up a Check-List Based Approach

Manual examination of borrowers’ credit information is highly susceptible to errors. They often tend to overlook minute inconsistency in borrowers’ credit histories. Such inconsistencies severely impact the quality of loans disbursed. A last-minute attempt to address these inconsistencies delays the entire loan closure cycle.

To avoid such a situation, experts recommend following a standard check-list based approach. This approach ensures that all the necessary documents are available and is distributed to concerned teams on time. Repetitive tasks such as processing and verifying data from massive number of loan documents, status verification from third parties, audit trials, among others should be automated.

Automating such repetitive tasks helps lenders to streamline multiple steps involved in mortgage processing. This reduces the entire loan closing type, thereby resulting in better customer experience.

Define Responsibilities

Mortgage closing packages often have erroneous or missing documents. This increases the amount of rework and communication within mortgage loan processing departments to fix errors. It reduces employees’ overall productivity. Reworks further prolong the loan closure cycle, thereby adding to customers’ dissatisfaction.

Experts recommend developing quality control checklists to establish loan documentation submission protocols. This ensures accurate loan document submission. Stakeholders across mortgage processing stages should be made of this checklist. Lenders must clearly define their responsibilities of using this checklist to proactively identify any document-related errors.

Move Applications through a Triage Process

Underwriters may miss riskier loan applications because of an arbitrary processing of mortgage loan applications. This results in a suboptimal underwriting decision, thereby leading to a bad loan approval.

To avoid such a situation, experts advise developing a triage method of processing loan application. To put it in a simpler way, lenders must rely on a rule-based engine that automatically processes routine files to entry-level underwriter and process the complex files to experienced underwriters. This strategy is highly functional in helping underwriters arrive at faster decisions. This ultimately contributes to shorter loan processing life cycle.

Keep Borrowers Updated

Mortgage processing typically involves lot of paperwork leading to inevitable delays. This makes it difficult for lenders to update borrowers on their loan application status on a timely basis. As a result, borrowers get frustrated, and lenders end up losing potentially big accounts.

Lenders’ representatives must provide borrowers with a loan processing timeline upfront. They must clearly explain all the tasks that borrowers have to do and within what time. To do this, experts recommend a range of smart tools as follows:

  • Pipeline Visualization tool that provides a snapshot of loan statuses processed by a particular team at any given point of time.
  • Opening a direct communication channel with borrowers where they can ask questions and receive updates on their loan application. This is critical in building borrowers’ confidence on lenders.
  • Program loan origination system to send weekly alerts to borrowers on their loan application proceedings.

Use a Cloud-based LOS

Loan origination system (LOS) is a software platform used by mortgage lenders to complete and facilitate lending processes starting from origination to post closing. This tool is designed to execute a range of functions that include loan origination, pricing, borrowers’ eligibility check, among others.

However, legacy LOS is unsuitable to handle sudden surge in loan demands. It cannot scale up to the requirement of multiple loan processing which is why it crashes. A cloud-based LOS is based on advanced artificial intelligence algorithms that has the following benefits:

  • Lower loan origination TAT
  • Faster document management
  • Updated compliance system
  • Identify low-risk cases
  • Easy access to loan documents
  • Eases collaboration among teams across geographies

A Fiormarkets research report suggests that the cloud-based LOS market is set to touch a value of USD 3540mn by 2024.

How We Assist You to Improve Your Mortgage Processing Framework?

We leverage well-defined mortgage back-office process flows and advanced automation technologies to process over 10000 loan applications within a single month. Partnering with us will open access to cross-skilled experts who can help you handle about 50% of more loan volumes even during rush hours.

However, we believe in maintaining the right blend of human intelligence and automation. In today’s era, automation is inevitable to improve mortgage processing. We also understand that it is an incredibly difficult task to choose and invest into the right kind of automation technology. You will need to bring significant changes in your legacy infrastructure to use any new kind of technology.

On this note, we make the task easier for you by bringing to MSuite, our proprietary optical character recognition-based platform enhanced by machine learning and artificial intelligence algorithms. This tool is platform-agnostic which means that it can be hosted both on-premises and on cloud. The modular structure of MSuite allows it to be used with other technologies as and when needed.

MSuite is designed to process mortgage loans with efficacy and acceleration. It performs data extraction and document indexing within minutes ensuring 90% data accuracy. As an indexing engine, it recognizes over 350 document types in varied format. It scans documents with a quality as low as 150 DPI while ensuring 95% of data accuracy.

The tool’s data extraction engine guarantees over 98% accuracy while extracting data from various sources such as appraisal SSRs, credit data, and others.

MSuite comes equipped with a powerful rule engine that automates a range of tasks. These tasks include file review for loan servicing, underwrite specific loan types, and many more. As a rule engine, the tool can also be customized according to your specific deployment needs.

The reporting engine generates reports on all the data points stored in the tool. Such reports are essential for any ad-hoc audit requirements. These reports can be customized according to your operational needs.

You need to make a minimal one-time investment to access this tool. One of the USPs of MSuite is it seamlessly integrates to your legacy infrastructure. Our team takes an end-to-end responsibility of implementing and customizing MSuite to fit your requirements.

Who Are We and Why Are We Considered as an Industry Authority?

This article is brought to you by Expert Mortgage Assistance, a prominent mortgage processing services provider. We provide an extensive range of mortgage processing services that include document compliance review, borrowers’ credit check, reviewing third party documents to loan estimate preparation, loan submission, condition clearing, and others. Get in touch with our experts to know more about MSuite and our specialized mortgage processing services.

No Comments

Leave a comment

Your email address will not be published. Required fields are marked *