During Digital Mortgage 2020, Capacity’s CEO, David Karandish, sat down with Wells Fargo’s CIO of Home Lending Technology, Matt Rider, and Fiserv’s VP of Operations for Digital Lending and Origination, Craig Evans, during a panel discussion, Reinventing Your Tech Stack For the Post-COVID Housing Market. Javelin Strategy & Research’s Director of Digital Lending, Austin Kilgore, asked a ton of hard-hitting questions revolving around lenders’ current challenges, tech solutions, customer experience, forbearance, and the state of the market. Discover the insightful answers from these industry leaders and feel free to apply any advice that you see fit!
What has been the biggest challenge for lenders?
Matt Rider believes that the biggest challenge has been getting the workforce remote and supporting the unprecedented volume while giving employees the same level of access to service the customer as if they were in the office.
David agreed with Matt, when it comes to the work from home transition, but believes that the demands of forbearance, loan modification, and avoiding loan foreclosure will be the next big challenges.
Any anecdotes in terms of the tech headaches that lenders solve for?
In almost every industry, companies had to go from working on-premise in the office to working from home in a matter of days. “Being able to work from home and working from home well are not the same,” explained David. Organizations are adopting technology to solve the disconnect that you have when you can’t walk down the aisle and ask someone a question. But some tech can actually accelerate that problem rather than solve it. “Companies need to set up a system that connects their teams and helps them stay focused.”
“Basically, lenders are striving to enable the people at home to handle more loans,” added Craig. Employees are at home striving to be as productive as they are in the office, and there is a new interest in any technology that can make employees more productive because of it. “Removing manual steps out of the process is a solution to a productivity problem,” said Craig. “The use of OCI and OCR tools or managing and running your data through rules can eliminate these manual processes.”
How has this pandemic been a gut check to mortgage companies?
Layoffs have been a constant across many industries, but David shared an anecdote from Capacity’s customers. “What I’ve found is that after reducing support teams, the work is still there, and companies need to automate work so that the remaining members can continue moving the needle,” explained David. Automating the low-level work helps people do the work that only people are good at. “At Capacity, our AI answers at least 84% of questions that come in. We take it a step further and gracefully escalate the remaining questions to a person in the simplest way possible,” said David.
David predicts that the vendors that recognize the need to automate and the reality that there will be a human component in your best processes are the vendors that will win on the other side of the pandemic.
If work from home is a part of the future of work, how do companies need to respond?
“When it comes to training, this is where the jury is out,” said David. New employees who start a job remotely don’t necessarily know where to go to get up to speed quickly. “This is why technology that can give you instant answers to questions or instant access to the people who know answers to your questions are so important,” explained David.
Any delays in routines and updates for mortgage companies? If so, how long will it take to get caught up?
It’s no surprise that even in the mortgage industry business slowed down at the beginning of the Pandemic. “We immediately saw some clients pull back as they didn’t think it was the right time to deploy tech,” shared Craig. “But now that we’ve moved through summer, people are looking towards (hopefully) the end of COVID, the refi wave is subsiding, and we’ve moved into a purchase market, we’re now seeing clients restarting integrations and shopping for new integrations, tools, and plug-ins that we didn’t see before.”
Are lenders thinking differently about the way different systems integrate and work together?
“I think that if lenders are being honest, they have to think about it differently,” said Matt. “The customer journey has completely shifted on the forbearance side for example.” A majority of loan modification requests are coming from people who have never been in this situation before. “It’s an entirely new jungle that they’re trying to navigate,” exclaimed Matt.
Because of these changes, the experience has to be completely re-engineered. Matt believes that companies need to look at their legacy tech stacks and the investments and decisions that they’ve been putting off. “Companies are seeing the true meaning of technical debt and how that can cause strain,” said Matt. “I think there will be a greater focus on driving greater integrations and streamlining them.”
Consumers are in the process of renewing forbearance, how are organizations preparing for the second half of the loss mitigation process?
Consumers understand forbearance more than they did during the great recession. Even though a lot of information is available online, customers still need that human touch. “We’ve been looking at our data about what our consumers are asking for, the pages they’re visiting on our sites, where they are dropping off, and what we can do to improve that experience,” said Matt. By looking at that type of behavior, it’s easy to predict the best places to start a response.
How are the companies that you’re working with dealing with the next steps of forbearance?
David shared that he’s seen a lot of companies strive to open up the dialogue about forbearance with their customers as soon as possible. “The worst thing that could happen is that a customer doesn’t have access to talk to their mortgage company until it is too late,” said David. “What companies are trying to do is make as many resources available as possible and help customers navigate through the process as seamlessly as possible.”
“Mine your own data and see what it tells you,” recommended Matt. Using data for process automation enables you to hone in on opportunities, and that personalization will help you stand out.
As we move towards a purpose-driven purchasing market, are there lessons learned?
“Before COVID, lenders were focused on trying to close a loan as quickly as possible, but we abruptly had to pivot back to customer experience and take care of the customer,” said Craig. “Quality of customer service, self-serve tools, and your ability to nurture leads is going to be more and more important.”
What will be some of the lessons learned now that will still apply 10-15 years down the road?
David shared three points for this answer:
1. The companies that spend the time to make the investments in automation today will be the winners in the future.
2. If you’re in an environment with fewer leads and your customer experience is more important, the interoperability in your company will be more important. A holistic 360 view of the customer will be a standard operating procedure moving forward.
3. Team members are going to choose where they work based on the level of automation that they can employ.