InsightsOrigination modernization: How the right partnership can drive success

Technology is a powerful tool in the quest for a truly modernized mortgage experience, but it's the partner behind the technology that can really change the game.

When interest rates hit record lows and originations hit record highs, lenders were happy to have multiple service providers supporting their businesses. Borrowers were clamoring, money was flowing and there was more than enough volume to go around.

That was then; this is now

While the Federal Reserve recently decided to keep its short-term interest rate steady for the second consecutive time, following a series of rate hikes in an effort to tamper inflation, mortgage rates still continue to hover near 8% for a 30-year fixed mortgage - a 23-year high. The Fed has not ruled out further rate hikes in the immediate future, either. It’s been a tough environment for both lenders and borrowers alike. As a result, lenders are looking for ways to streamline to stay competitive in a down market as they look forward to brighter days ahead.

"Today, with loan origination volumes down across the board, lenders are looking more closely at the cost of producing a loan, and at best practices that can help them streamline their costs and processes," says Jim Gladden, senior vice president, origination strategy, ServiceLink. "They recognize that tech-enabled solutions are essential to the mortgage process and that they don't need as many providers as they once did. The key to success now is choosing the strategic partner who not only continually invests in leading-edge technology, but also collaborates with lender partners to optimize their processes and help them prepare for the future."

ServiceLink fits that bill, Gladden says, by delivering solutions such as EXOS® Title, whose instant clear-to-close title commitments get borrowers to the closing table faster; providing expertise and support in the development and implementation of high-efficiency processes that save lenders time, labor and money; and creating exceptional consumer experiences with the power to set lenders apart. ServiceLink's backing by Fidelity National Financial, the Fortune 500 title insurance and settlement services leader, ensures the company's stability and ongoing reinvestment.

Over the past several years in particular, ServiceLink has helped leading lenders capitalize on market opportunities while overcoming internal workflow challenges. The following three case studies illustrate how ServiceLink's expertise, commitment and solutions have helped position its partners for success.

#1 Streamlining processes for a top-tier lender and its captive title agency

Recently, a non-bank lender that was aggressively moving up in the originator rankings became interested in ServiceLink's technology - in particular, EXOS Title. The company was looking for a more efficient and consistent workflow, and viewed instant title technology as a potential solution.

"We integrated directly with the lender's loan origination platform so we could receive order information and immediately send back notifications as to whether loans qualified for the instant process or not," says Gladden. "The lender put transactions that qualified into a separate swim lane, where the title-to-close process could be streamlined. Meanwhile, the more complex loans were routed to a team with curative experience. The result was faster title decisions and clear-to-close commitments, which enabled the company to manage growing volume with ease."

The lender was so pleased with the instant title process that they asked ServiceLink to duplicate it for their captive title agency, which was managing more than half of their volume. Once again, ServiceLink increased efficiencies by identifying loans that qualified for faster closing, helping the agency reduce cycle times and consistently meet their rate locks.

This new approach to title positioned the lender to manage substantial volume growth. Over one 12-month period, their title process enabled them to close more than 100,000 transactions quickly and consistently. Overall, ServiceLink provided lift on more than 80% of the lender's volume.

Additionally, this lender chose to adopt ServiceLink's EXOS® Close, a technology platform that removes the traditional back-and-forth communication between consumer and lender by enabling the consumer to self-schedule their closing. Borrowers now receive their appointment confirmations within five minutes, and the lender receives notifications of key milestones for transparency throughout the process. This capability is yet another way ServiceLink streamlines the mortgage process and adds value for this lender partner.

"When we established this relationship, we were one of several national providers," says Dave Howard, executive vice president, origination services, ServiceLink. "The lender is now consolidating their third-party work between just ServiceLink and their captive. Their internal costs have been reduced as their efficiency has improved. They have fewer touchpoints with other vendors, a more consistent process for their internal people and a better customer experience made possible by our scheduling technology."

#2 Improving speed and customer satisfaction across direct consumer and retail channels

This top-tier depository institution adopted the idea of instant title in the first quarter of 2022, as volumes began trending downward and they had more time to consider implementing new best practices. The lender engaged ServiceLink for a 60- to 90-day pilot with the goal of identifying loans in their direct consumer channel that could clear in two days or less, and then drive a high percentage of those loans to close within 15 days, essentially cutting out two-thirds of the cycle time.

The two partners collaborated on a process that would clear titles quickly and minimize any idle time between clearance and closing. They found that about 70% of transactions met the criteria for instant title processing and that they could close around 60% of those loans within the 15-day window. The success in the consumer channel has led to a new pilot to drive similar outcomes in the lender's retail channel.

"The pilot's success was attributable to not only the application of EXOS Title technology, but also the lender's willingness to modify their internal processes to get instant title transactions to the table faster," explains Howard. "The loans moving through this process require fewer touches and can be booked with greater speed and certainty."

This new efficiency has been welcomed by borrowers, according to Gladden. "Though we are still very early in this initiative, the lender has already seen the needle move 10 to 15% higher on customer satisfaction scores. Consumers are saying a lot of good things about their refinance experiences."

#3 Speeding the title process and making the most of data

When a lender's volume jumps from 5,000 to 16,000 loans a month, with 30-day rate locks, their process needs to be reliable and efficient. This top-tier lender had that advantage when the pandemic hit and their volume more than tripled. ServiceLink had worked with them to establish an instant title process that helped them fast-track qualifying loans and positioned them to scale up without increasing headcount.

"This lender was interested in not only the instant title process itself but also the related data we could provide," says Gladden. "By extracting and analyzing that data, they were able to bypass certain rules and some of their manual underwriting processes further downstream. Alternately, they might decide that for some loans it would be prudent to use their offshore underwriting process, which was more cost-effective since it involved a junior title reviewer as opposed to a more experienced reviewer based in the States."

Ultimately, ServiceLink enabled the lender to increase efficiency and reduce loan production costs by delivering the instant title experience on more than 65% of title orders, and providing title data that was instrumental in streamlining internal processes.

Moving away from a multiple-provider model to a closer, more collaborative partnership can be a smart move, particularly in today's challenging environment. This model will also help lenders be prepared to scale when volume picks back up again. When you choose the right partner - a partner with exceptional technology, reliable data, a track record of stability and success, a commitment to security and compliance, and a knowledgeable, supportive team - the results can be extraordinary.

Learn more about ServiceLink's EXOS Title instant title solution.

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