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The Fintech Revolution

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“The mortgage industry has always been about survival of the fittest, and the most ‘fit’ lenders and service providers will be ahead of the curve,” said Langner.

Mortgage Media | August 8, 2019 

With the California MBA Innovators Conference coming up next week, the topic of technology is on everyone’s mind. Whether it’s on the back-end or consumer-facing, financial technology (fintech) promises to revolutionize and reshape the mortgage industry. But despite the huge benefits, it can be complicated to navigate the options, implement, deal with compliance and integrate it into current systems.

There’s no doubt that even the smallest steps to integrate fintech into existing (and often some-what archaic) processes has made a huge difference. 

That’s because getting a mortgage is the longest and most frustrating financial transaction that consumers do today. Consumers can get a car loan or lease, a credit card, perform ATM transactions, buy or return things, and get most types of insurance, all in under a day and often in near real-time. 

But a mortgage typically takes 40 days and is costly due to the work and time the provider endures to produce the mortgage. As a result, most consumers see obtaining mortgages as a rare event in their lives – in fact, one to be avoided. 

Fintech has the potential to make the turnaround for a mortgage transaction nearly as fast as these other everyday consumer transactions, which would change how getting a mortgage is viewed. The economics would change, such that moving in an out of mortgages for better rates and better terms may become as simple as moving in and out of car loans/leases and credit cards today. With low costs and fast turnarounds, tech-prepared banks and mortgage companies will figure out how to make far more money due to far more transactions taking place.

According to Stephen Butler, Founder and President, AI Foundry, robotic process automation (RPA) has made the biggest impact thus far in the mortgage processing back office. Tasks such as initiating communication based on events, getting external agency data (like credit reports and title), and repetitive filling out forms, are all able to be automated with RPAs today, saving substantial cost and time in the back office, he said.

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