I have worked in the reverse mortgage industry for more than 20 years, and I’ve seen firsthand the affect that technology has had on improving the reverse mortgage market. When I first started Bay Docs, lenders would fax data required to complete closing packages. We would then send the packages back via overnight courier, praying that the weather patterns from one end of the country to the next would allow for a timely delivery. This grueling process greatly reduced a lender’s ability to grow his business. Clearly, there was a cry for technology, and that cry was heard.
The technology options for the reverse market grew slowly but steadily. Previously, lenders and brokers could only find automated systems offered by the investors that would buy and service their loans. Today, there are a host of options designed by technology providers from which lenders and brokers can choose. With the development of this competitive tech market, lenders can select the loan origination system (LOS) that works best for them and exponentially improve their bottom line.
Every facet of the industry has benefited from LOS improvements. Lenders can offer potential applicants a package listing the program’s benefits and can automatically email this information with a list of local counselors. Processing and underwriting departments can increase their productivity through the enhanced features designed specifically to make their work more organized and streamlined. Closers can order documents with the click of a button and have packages securely retrieved. And lastly, management can rest assured that loan documents are protected, as the ability to integrate the LOS with attorney firms greatly enhances the security of a document package.
The ability to link to third-party vendors directly from your origination system has also been a smart improvement. Lenders interested in investigating systems should certainly look into these features. The ability to get closing costs by linking with a settlement company saves valuable time, which would be wasted if one had to research various fees that differ state by state. Other beneficial LOS advancements include functions that allow the user to obtain a credit report directly within the system and to order an appraisal by simply pressing a button.
Investors can also benefit from this new LOS technology by syncing their systems with a lender’s origination platform, which removes the need for double entry and reduces errors. This technology provides better methods to bundle portfolios and work with the secondary market. Systems that are feature-rich continue to stay ahead of the game and provide the best solutions for the user.
Although the reverse mortgage market has continued to evolve, there has yet to be a truly standardized technology for loan origination systems. What works for one lender does not necessarily work for another. What one compliance department requires doesn’t match the needs of another. Technology will play a key role in determining best lending practices, and tech providers will continue to design platforms that service these needs. Technology is key to
expanding the reverse mortgage market. Advanced tools will inevitably streamline production, which will reduce costs and ultimately benefit the senior consumer.
