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.
The current regulatory atmosphere that pervades the mortgage industry is literally choking some servicers; so much so that profitability seems doomed to a downward spiral that will ultimately result in insolvency for many.
The financial cost of non-compliance is painfully obvious – the $25 billion settlement last year that gave rise to the National Servicing Standards; the $25 million penalty assessed Capital One; the recent $3.2 million fine levied against MetLife. But is there a greater cost to consider? What about the intangible costs associated with a damaged brand image, consumer distrust and uncertainty about the future?
The point is – within the current regulatory atmosphere lie pitfalls of far greater danger to your future than simple compliance. What many mortgage companies need is an alternative to the heuristic approach being taken by most today. When you 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 you quickly come to the conclusion that a real strategy is needed.
CFPB rules and regulations are all aimed at protecting the borrower. Borrower frustration is grounded in poor communication and poor information management. To get at the heart of the issue every mortgage company needs a strategy that embraces on-the-fly composition of warranted communications – on a flexible, user friendly platform that can be implemented rapidly and at a pre-determined cost.
We'd love to hear from you. Do you feel the current regulatory atmosphere has reached a point of “punitive overreaction”? Tell us why or why not in the comments below.