Dave Howard is ServiceLink’s Executive Vice President, Originations. In the below interview, he discusses how modernization can reshape the mortgage industry.
What is ServiceLink doing to modernize origination?
We look at modernization across three constituents that are involved in a transaction: the lender, the borrower, but then also the vendor that's involved there as well. So when we're talking about the vendor, we're talking about the end service provider who is looking at either executing a closing or an appraisal. We are constantly trying to improve processes so that each of these constituents see an improved experience, while providing exceptional service.
How do you define and approach your modernization?
We define modernization by looking at how we can improve each touchpoint in the process, whether that be for the lender, borrower, or vendor. For a customer base that’s expecting full digitization in the process, we know it begins with them. For lenders, it’s all about increasing efficiency and effectiveness, while still providing exceptional service. Lastly, for ServiceLink, we are at the forefront of providing this balance of digitalized processes while still keeping our high level of service.
If you're a lender in the industry, when is the right time to kind of implement some of these recommendations?
Right now is actually the best time. If you look back at where things were in the last year and a half, the volumes were record-breaking. Everybody was doing what they could to keep their heads above water. Now it's different. Right now, the volumes have dropped dramatically. Obviously, sensitivity to the rate environment has been a challenge. People are looking to reduce costs. But then the expectations from an end customer perspective are still very high when it comes to digital engagement throughout their mortgage experience. So how do lenders meet those expectations? They couldn't change their processes 18 months ago. They should optimize now and then when the market eventually does come back, they’ll be in a good spot to scale, without dramatic cost increases to support legacy manual processes.
What do lenders risk by not going through this modernization effort?
On the risk side, they have the risk of falling behind their competition, because technology never stands still. It's never static. But then when you're competing for a limited number of opportunities, how are you going to differentiate yourself to engage with the potential borrowers who are out there actually looking for the services? If you're not engaging with them in the manner they expect, it's going to be difficult for you to compete.
Let's talk appraisals. How does that fit into modernization efforts?
It’s a key part of it. It’s one of our core competencies. And really, we're looking at creating capacity. There's more acceptance or coming acceptance of appraisals that are leveraging new inspection technologies that can be done either by inspectors or consumers. And we are certainly a participant in that in that ecosystem. And now that there is acceptance of these alternative types of valuations, we're going to see a lot more of that in the industry and we're happy to be participating in that.