Mortgage Lenders Have Witnessed Major Operational Advancements During the Pandemic

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BLOG VIEW: As with other sectors within the U.S. economy, the mortgage industry has accelerated its investment in – and adoption of – digital technologies in response to the COVID-19 pandemic. 

With mandates and restrictions in place, mortgage lenders have been tasked with finding ways to continue operating profitably with a newly distributed workforce. And while much attention has been given to the innovative ways that lenders have enhanced the borrower-facing side of the business, there are a number of technology changes and enhancements that have been made in the back office that will provide lenders with significant return on investment for years to come, including the following:

A Shift to a Paperless, Fully Networkable Accounts Payable Process

As remote officing became the norm, lenders were forced to reconcile the fact that they still relied on a number of manual, paper-based accounting processes internally – processes that required people to be in the office to physically manage. Within accounts payable, for example, lenders are now able to gain operational efficiencies through technology that can electronically “read” emails, automate approvals based on the lender’s set parameters, and then disperse payment via either automated clearing house (ACH) or electronically with electronic fund transfer (EFT) capabilities.

More Control Over the Process

If the flow of accounts payable documentation becomes easier, the level of control that the lender has over the process becomes easier, as well. By automating and standardizing the review and approval process, lenders can better guarantee that each transaction receives the level of attention that it truly deserves. This, in turn, has the added benefit of positioning the lender more favorably for audits or regulatory scrutiny as a more standardized process reduces opportunities for error and streamlines reporting.

Greater Flexibility in Staffing and Talent Acquisition

Lenders that have made the shift to automated back-office operations have the freedom to augment their teams with the best talent, regardless of geographic location. Today, it is not uncommon to see a lender with a controller in California and an accounting manager in Florida, all working together efficiently as if they were in the same office location. This fundamentally changes how lenders are thinking about growth and HR and for many, opens up a wealth of opportunity that may not have existed before.

If nothing else, the mortgage industry has proven itself over time as one built on resiliency and an ability to adapt. As an industry and as a nation, we all hope the effects of the pandemic will subside and we can return to normalcy. When that day does come, what many lenders will find is that their efforts toward getting the costly burden of paper out of the office will generate even greater benefits in the course of their normal, daily operations in the future. 

Joe Ludlow is the vice president for Irvine, Calif-based Advantage Systems, a provider of accounting and financial management tools for the mortgage industry.

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