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March 2024 ยป thefivestar.com 49 March 2024 F E A T U R E S T O R Y The benefits of these technologies are not theoretical. In addition to reducing the number of repurchase requests from the GSEs and other investors, lenders that have adopted them have achieved signif- icant cost savings and substantial ROI. In fact, our own clients have been able to reduce some income calculation costs by $400 per file, scale operations with auto- mated classification of 689 document types and extraction of more than 10,000 data fields, leverage 20 component reviews to meet new prefunding requirements more cost effectively, and complete post close reviews within 90 days. Of course, weeding out loan defects and meeting investor requirements more cost-effectively is not just about dollars saved and efficiencies gained. It is also about elevating a lender's profile in the secondary market at a time when demand for higher-quality mortgages is at a pre- mium. But this begs the question, what is the best way to take advantage of machine learning and other emerging technologies to streamline loan production, loan acqui- sition and QC processes? Getting From Point A to Point B F or most lenders, the first step in pro- cess improvement and risk mitigation is shifting one's focus from reactive to proactive. In practical terms, this means performing an honest and thorough self-assessment of the organization's exist- ing production and QC processes, hunting down vulnerabilities, and determining what works and what does not. If a lender has not audited its processes recently, now is the time. This audit should be as inclu- sive as possible, ranging from processing to underwriting to documentation to QC reviews. It is equally vital for mortgage lenders to scrutinize the capabilities of their existing vendors and evaluate more auto- mated tools to improve their own process efficiency. For lenders, automation exists to accurately calculate borrower qualifying income, pre-screen loans for high-risk factors, and identify missing documenta- tion or inconsistent data before they reach the closing stage. Post-close, technology can help to validate data integrity from documents and systems, leverage that data to power audit automation, and complete post close loan file reviews more quickly to align with a shorter 90-day review window. For correspondent and servicing oper- ations, where time is money, ensuring that loan acquisition and loan on-boarding is done efficiently and in a highly transpar- ent way is critical. Missing documents and data issues can result in costly delays, holdbacks and tied up warehouse lines. Finally, for any well-equipped oper- ation, reporting and action plan tracking can uncover the root cause of defects and incorporate what has been learned for continuous process improvement. A lender's future workflows, a correspon- dent's guidance to sellers, and a servicer's onboarding experience for borrowers can all be informed through reporting and trend analysis that detects troublesome patterns early for proactive action. Taking the Next Step I n the challenging market we find ourselves in, adaptability to originate different types of loan products with quality while satisfying the timelines and requirements of any secondary market loan buyer represents an opportunity for transformative growth and heightened operational efficiency. Lenders should act now on imple- menting automation to balance staff resources more effectively during market upturns and downturns, leveraging loan quality insights to understand defect trends related to shifting market dynam- ics, and validating loan file data to avoid investor repurchase risks. For most organizations, it is more than just avoiding losses. It is about creating a more resilient, compliant, and profitable mortgage business for the long haul. In this sense, the sooner lenders conduct a deep dive into their processes and embrace new technologies, the faster they can pro- tect their businesses and start turning the odds in their favor for increased profitabil- ity and growth. RUNNING the NUMBERS Brought to you by & Magazine Y O U R T R U S T E D S O U R C E F O R M O R T G A G E B A N K I N G A N D S E R V I C I N G N E W S JANUARY 2024 LENDERS CANNOT AFFORD TO IGNORE AFFORDABLE LENDING Courtney Hess of Mortgage Cadence explains the changing face of the average American homebuyer, and how expanding product offerings can keep pace with this evolving market. CALL CENTERS UNDER NEW SCRUTINY FOR 'SOFT SKILLS' Samantha Shanaberger of Clayton Servicing Oversight examines the policies and practices of servicer call centers, and how these centers must remain vigilant of changing rules and regulations. THE NEXT DEFAULT SPIKE WILL BE UNLIKE ANY WE'VE SEEN BEFORE Things have changed dramatically in the way the default and foreclosure world operates. In this Issue: MortgagePoint assembled a panel of economists to forecast the top trends and headwinds they expect to define the housing market in 2024. Subscribe to MortgagePoint and MortgagePoint Digital now! Call 800.856.8060 to take advantage of our special introductory offer! Experts you trust. People you know. News you want. MortgagePoint is putting essential mortgage market news at your fingertips with our new digital edition, now available online via your smartphone, tablet, or computer. Enjoy the magazine at your desk, and tap into MortgagePoint Digital's easily accessible platform anywhere, anytime. Committed to giving originators, servicers, and all lending professionals access to smarter perspectives, MortgagePoint believes it's time to think differently about the mortgage industry. Because the American Dream is evolving . . . are you? Brought to you by & Magazine YOUR TRUSTED SOURCE FOR MORTGAGE BANKING AND SERVICING NEWS DECEMBER 2023 THE EVOLVING DIGITAL FRONTIER Mortgage tech advancements in 2024 will be transformative. Here's how. FHFA SUPPLEMENTAL PARTIAL CLAIM: THE NEXT ITERATION Taking a deep dive into Supplemental Partial Claims, the benefits and drawbacks they present in today's mortgage landscape, and other considerations. NAVIGATING THE REAL ESTATE LOCK-IN EFFECT Why are so many homeowners staying in place? FIVE STAR ANNOUNCES LAUNCH OF MORTGAGE SERVICING EXECUTIVE ALLIANCE In this Issue: EYES HORIZON As we approach a new year, MortgagePoint took the temperature of industry experts to see what lies ahead for a market that trudged through 2023 hampered by the convergence of rates reaching 20-year highs, a shortage of housing inventory, and inflated home values. Brought to you by & Magazine Y O U R T R U S T E D S O U R C E F O R M O R T G A G E B A N K I N G A N D S E R V I C I N G N E W S NOVEMBER 2023 THE COST OF DOING BUSINESS With factors ranging from low volumes to inflation and manpower shortages putting the squeeze on the property preservation and field services sectors, MortgagePoint speaks to vendors and government agencies trying to guide this important industry through the challenges. MARKET CHANGES DRIVING SMARTER CUSTOMER CONVERSATIONS How leveraging advanced CRM can boost business by blending user-friendly technology and the human touch to create a more seamless mortgage experience. DIFFERENTIATING AI APPLICATIONS IN THE MORTGAGE SPACE Building a culture of innovation that supports the adoption of disruptive technologies is like unlocking a hidden treasure. FROM MANUFACTURING TO MORTGAGES, QUALITY DATA IS KEY When it comes to accurate data, companies can't afford not to use AI. IDENTITY CRISIS Here's how digitization reshapes the battle against seller impersonation fraud. THE INDEPENDENT INVESTOR IMPACT Could real estate investors be the answer to the housing shortage? 5 TRIGGERS TO SHIFT IN-HOUSE SERVICING TO A SUBSERVICER Could you be getting a better ROI on your servicing portfolio? ALSO IN THIS ISSUE: