I talk with mortgage industry professionals every day. They are busy people trying to do a difficult job, too often under a microscope. In addition to struggling with servicing platforms that were originally designed in the 1970’s, they are all just one misstep away from another negative headline.
In a previous life I worked for a giant computer company. One of the activities I had to do was level set expectations with new clients who had invested large sums in new computer and software systems. This setting of expectations took the form of reminding new clients that new systems always necessitate a learning curve, the implementation itself would be disruptive to their established processes, and that real efficiencies would not be realized immediately.
Today’s mortgage stakeholder is busy. Not just busy, but “crazy busy”. This leads mortgage decision makers to prioritize projects based upon perceived complexity. Priority is given to those issues that - on the surface - seem easiest to fix. This is a completely understandable position, to be sure, but one that tends to make the status quo more intractable every day. Moving forward in the “new normal” of the current mortgage servicing market requires a willingness to be proactive rather than maintain the status quo and hope for overall economic conditions to improve.
In our lifetime the single most disruptive technology to impact industries of all types—especially the mortgage industry—is communication technology. All one needs to do is look at the communication capability that now rests in the hands of the average high school student. Text messaging is the norm, iPhones and tablets are pervasive, not to mention laptops. It shouldn’t be so difficult for the average mortgage lender to grasp the potential significance of customer communications management (CCM).
Regulation. The word seems in and of itself antithetical to the American spirit of free enterprise, entrepreneurship, and business progress. But any discussion of today’s mortgage industry must start with the changes wrought by the tide of regulation sweeping the marketplace. The White House, Department of Justice, the OCC and the Consumer Financial Protection Bureau (CFPB) are all striving to protect consumers and bring “transparency” to the mortgage process – from origination all the way to loss mit and foreclosure. So what exactly do all the regulations mean?
The traditional “buy/build/repeat” software and bodies approach to addressing many of the issues facing today’s mortgage industry will not work. It’s simply not scalable. More so than ever before, execution is now critical. It’s time to think outside the box, look at new ways of doing business, take calculated risks, and evaluate solutions with an open mindedness not constrained by cost alone.