5 Ways Outsourced Loan Processing Powers Growth and Agility for Local Lenders

Consider this: you’ve recently set up a retail clothing store in your locality. Over a period, the business starts doing well. So, you start making plans to expand across the city. This implies additional work. Everything, from sourcing raw materials, tailoring garments and quality control to sales, is your responsibility.

It may be easy to handle one store, however, doing all of this, single-handedly, for each new outlet— a recipe for disaster, surely?

It would make so much sense to outsource procurement, operations and sales to a service provider. Don’t you agree?

Handling your business processes independently is much the same.

As a lender, you may agree that businesses in the US mortgage market constantly struggle with challenges such as intense business competition, fluctuating consumer demands, strict compliances, high mortgage interest rates and tight budgets. For these reasons, it becomes difficult to achieve scale.

Outsourcing agencies can not only help you resolve such issues but also streamline all functions across mortgage loan processing. This blog aims to uncover the many benefits of mortgage handling services for your business.

The Benefits of Outsourced Loan Processing for Lenders

Variable Costs to Meet Demand Fluctuations

The US mortgage market is heavily reliant on consumer demand. For instance, the volume of loan originations isn’t constant throughout a financial year. Outsourcing can help you meet demand fluctuations through a variable cost structure I.e. change according to the service output produced. In-house hiring costs, including recruiting, engaging and retaining the workforce, add significantly to your business expenses. These expenses can be offset by profits when loan origination volumes are high. However, fixed costs such as staff hiring can reduce profitability in cases of low demand.

Third-party providers can easily offer variable pricing and speedup or slow down onboarding to meet loan origination volume fluctuation

Expert Services to Stay Competent

Local mortgage lenders and small banks in the US must consistently compete with mega lenders or incumbent competitors in an increasingly competitive market. In fact, some of the bigger businesses have doubled their shares in recent years, causing SMBs to feel pressured to create a positive brand image to compete with bigger businesses and attract customers.

Outsourced loan processing can help you compete with bigger financial institutions. Providers who offer both best-in-class services and extensive knowledge will create a positive impression with your customers, and help create brand awareness. They will also streamline every stage of the lending process from loan application to closing or fulfillment. They take care of every small loan administration detail so you can focus on loan origination and delivering quality customer service.

When you look for an outsourcing service provider consider their years of experience and certifications. Make sure they offer customizations to suit your needs and your budget.

Technology Integration to Improve Service Quality

Until 2020, the mortgage industry hadn’t experienced the integration of advanced automation technologies like Artificial Intelligence (AI) or Machine Learning (ML). Now, an increasing number of mortgage lenders are automating business processes to offer smart solutions

Artificial Intelligence can not only analyze data, but also train machines to perform cognitive functions like predicting payment ability and highlight errors that could lead to denials, to name a few.

Outsourcing providers can generate AI and ML backed insights that will help you make accurate predictions. For instance, you can streamline preapprovals and closing disclosures and even keep up with high loan origination volumes.

Mortgage process automation has the potential to streamline your workflows and speed up time consuming or tedious tasks. AI can also minimize turnaround times of mortgage loans by automating functions and gathering, reviewing and verifying data.

Mortgage loan processing is tedious, nuanced and requires expertise. Outsourcing some of the processes will let you stay competitive through variable pricing, technology integration and expert services from certified professionals.

Find out how outsourcing mortgage loan processing can help your business. Contact HelioNext to scale up, improve bottom line and effectively meet customer requirements.