Time to Retire Outdated Manual Underwriting Processes


BLOG VIEW: The introduction of an advanced, automated and comprehensive platform for underwriting a loan is long overdue.

In an age when digitization and automation are at the forefront of nearly every industry, underwriting professionals should no longer have to accept extended timelines and missed closing dates because of clunky, manual processes.

It’s time for a more efficient and cost saving underwriting process.

A New Era in Underwriting Solutions

Recently, innovations in mortgage underwriting have centered on front-end point of sale solutions that address consumer’s pain points when applying for mortgages.

According to the Federal Housing Finance Authority, 18% of home loan applicants had to redo their paperwork in 2016 and around 24% had their closing dates postponed.

Through the adoption of front-end online mortgage platforms, the industry is attempting to make the process easier for all involved by allowing consumers to apply for a mortgage electronically.

These solutions give consumers the ability to upload documents and manage applications on their schedule while reducing the time and cost required for each origination.

These new efforts to streamline the process have initially energized the industry and introduced consumers to the idea of a digital mortgage that is simple, fast and easy.

Despite this uptick in innovation on the consumer side, underwriters still face fragmented manual processes on the backend, which slows progress and increases underwriting costs.

From accessing applicant data to documenting underwriting exceptions and decision rationale, today, lenders face overly-complex processes.

In a recent CoreLogic study of mortgage and underwriting professionals, 54% of respondents say it’s becoming more difficult to underwrite a loan.

Additionally, 66% have to ask for a borrower’s documentation multiple times, and 56% claim they need more than 30 days to complete one loan file.

Lenders must also work with various vendors that often deliver disjointed point products that don’t work harmoniously. By integrating a tool that digitizes, automates and streamlines the underwriting workflow, lenders could help accelerate existing processes and reduce origination costs.

Addressing the Challenges Facing Lenders

Lenders are looking for an integrated solution to help streamline their current mortgage workflow and make the process more efficient, as well as to ensure data quality, reduce costs, and minimize human error and compliance risk.

To overcome today’s disconnected processes, lenders need a solution they can trust – one designed to streamline workflow for loan officers, processors and underwriters.

By providing access to individual point products – income verification, employment verification, asset verification, income calculation, etc. – in a single integrated solution, the entire mortgage ecosystem can operate with more connectivity and ease.

Jay Kingsley is executive for credit solutions at CoreLogic, a provider of software, data and analytics to the mortgage industry.

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