The Need for Innovation and Advocacy in Mortgage (Podcast)

By: Craig Berry Reviewed By: Paul Centopani
August 8, 2023 - 3 min read

The future of lending

The mortgage industry is a complex and highly regulated sector.

Perhaps, in part, that explains why it’s traditionally been slow to adopt technological advancements. However, there is a need for innovative mortgage tech to streamline processes, improve efficiency and enhance the overall customer experience.

In this episode of The Mortgage Reports Podcast, Craig Berry discusses these needs with Matthew VanFossen, the CEO of Absolute Home Mortgage and Mortgage Automation Technologies. Here’s what they had to say.

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Simplifying the lending process

Technology stands as one of the white whales in mortgage lending.

Loan officers and borrowers alike feel the mortgage process lags the contemporary efficiency of other financial sectors. Simplified consumer portals is something that could really help, VanFossen posits.

Web-based, point-of-sale solutions offering a user-friendly borrower experience could streamline the application process by making it easier for people to submit their information and for lenders to process and approve loans.

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Technology could help address the challenges and complexities of the mortgage industry — including some of the regulatory red tape associated with the business. Embracing advancements and innovations could be crucial to providing a better experience for borrowers and remaining competitive, he continued.

Advocating for the consumer

The American Dream’s idyllic vision of homeownership doesn’t just happen.

VanFossen emphasizes that mortgage companies serve a major purpose in ensuring the policymakers in Washington understand the impact of their decisions on prospective home buyers.

As an example, VanFossen and his team collaborated with the Federal Housing Finance Agency (FHFA) and Consumer Financial Protection Bureau (CFPB) to address the issues with Loan-Level Price Adjustments (LLPA) based on debt-to-income (DTI) ratios.

Their work, in tandem with other trade associations, convinced the FHFA to reconsider the LLPA regulation, which was causing difficulties for consumers to buy property.

An evolving marketplace

When new regulations are introduced, lenders must update their protocols to comply. Similarly, when technology advances, lenders must also keep up or become antiquated by comparison.

From automation to artificial intelligence, lenders who stay ahead of the trend can better serve their customers by adapting to their ever-changing needs and expectations.

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Self-service has become the norm for many apps and businesses, with consumers coming to embrace the convenience. Berry mentions the idea of getting into a stranger’s car ordered from the internet would have seemed crazy not too long ago. However, the rise of ride-sharing services like Uber and Lyft has shown that consumers are willing to adapt to new concepts and technologies.

Mortgage companies need to do the same in order to provide better services to borrowers, and become more efficient themselves.

The bottom line

By embracing innovative technologies and staying proactive in advocating for consumer-friendly policies, the mortgage industry can continue to evolve and provide better services to both its borrowers and workers.

Loan officers who can offer a streamlined and hassle-free application process can build better trust with their customers. Additionally, by simplifying the back-office processes, loan officers can focus more on building relationships with real estate partners.

While there may be challenges to overcome and red tape to cut, the future of digital-based mortgages holds promise for the industry.

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Craig Berry
Authored By: Craig Berry
The Mortgage Reports contributor
With over 20 years in mortgage banking, Craig Berry has helped thousands achieve their homeownership goals.
Paul Centopani
Reviewed By: Paul Centopani
The Mortgage Reports Editor
Paul Centopani is a writer and editor who started covering the lending and housing markets in 2018. Previous to joining The Mortgage Reports, he was a reporter for National Mortgage News. Paul grew up in Connecticut, graduated from Binghamton University and now lives in Chicago after a decade in New York and the D.C. area.