improving profitability through digital mortgage .pdfdigital mortgage process 92% of lenders would...
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Improving Profitability Through Digital Mortgage
Maria Vergara Fannie Mae
Technology impacts what we do and don’t have to do…
Borrower Interest in a Fully Digital Mortgage Process
Very Interested
Somewhat Interested Not Very Interested
Not At All Interested
Both lenders and borrowers see value of end-to-end integration
Value of an End-to-End System For Lenders
Extremely Valuable Somewhat Valuable Not Very Valuable Not At All Valuable
66% Of borrowers are interested in a fully digital mortgage process
92% Of lenders would find an end-to-end system valuable
Borrower Lender
Source: Mortgage Lender Sentiment Survey®, National Housing Survey®
Most Difficult Part of Getting a Mortgage
Gathering financial information is most difficult part of process
Q: What would you consider the most difficult part of the mortgage process?
© 2018 Fannie Mae. Trademarks of Fannie Mae.
38%
13% 12% 9% 8% 7% 4%
Gathering all your financial information
Finding the right lender
Wait time/length of the whole process
Getting through the loan application
process
Reviewing final documents
Finding the right loan Getting your application approved
38% think gathering all the financial information is the hardest part
Q1 2018 National Housing Survey®
Time to Get a Mortgage: Reality vs. Expectation
Length of time to get a mortgage is too long
Q: How long did it take to get a mortgage (from application to close)? Q: How long do you think it should take to get a mortgage (from application to close)?
© 2018 Fannie Mae. Trademarks of Fannie Mae.
10% 22%
29% 19%
9% 9% 9%
31% 35%
14% 5% 3%
1 week or less 2-3 weeks 1 month 4-6 weeks 2 months 2+ months
How Long it Took
How Long it Should Take
75% think it should take one month or less to get a mortgage
Q1 2018 National Housing Survey®
How to Make the Mortgage Process Easier
Reduce Paperwork
Q: What, if anything, would have made the process of getting a mortgage easier? Please select the one that would have made the process easiest for you.
© 2018 Fannie Mae. Trademarks of Fannie Mae.
27% 20% 16% 11% 7% 5% 8%
Less paperwork/fewer forms
The ability to shop and compare loan
terms from multiple lenders at once
Less back and forth during the approval
process
Loan terms and costs that are easier to
understand
Shorter length of time from application
to closing
More responsiveness from your lender
None
16% want less back and forth during the process
20% think making it easier to shop and compare terms from lenders
27% say a reduction in paperwork
Q1 2018 National Housing Survey®
• Simplicity • Speed • Confidence
On the technology front, consumer expectations continue to rise
38% desire less
complicated way of
gathering information
75% believe it
should take less than 4
weeks
27%
Want less paperwork
Creating a superior borrower experience, driving operational efficiency resulting in reduced origination cycle times and providing freedom from representations &
warranties
DU® Validation Service
Freedom from paper-based processes with validation of income, assets, and employment through third-party data vendors
Appraisal Waiver Freedom from appraisal requirements on eligible transactions
Certainty on Appraised Value Freedom from reps & warrants on appraised value with the power of Collateral Underwriter®
(CU ™) when the CU risk score is 2.5 or lower
© 2018 Fannie Mae. Trademarks of Fannie Mae.
© 2018 Fannie Mae | Trademarks of Fannie Mae
VALUE & BENEFITS
EXCEPTIONAL CUSTOMER SERVICE
CYCLE TIME REDUCTION
DIGITAL INNOVATION
REP & WARRANT RELIEF
EMPLOYEE SATISFACTION
• Dramatically reduce paperwork
• May result in quicker loan approvals
• Compete with cash offers
• Help eliminate last minute requests for additional information
• Potential shorter rate locks
• Increase capacity of loan application volume
• Utilize your human capital more efficiently
• New vendors continuously added
• Prep for new technologies that are coming in the near future
• Keep up with the competition & borrower expectations
• May result in reducing amount of capital required
• Income • Employment • Assets
• Commissions quicker • Gain ability to focus
on more complex loans
• Increased referrals
It’s a journey but customer feedback is positive and momentum continues
seeing an increase in customer satisfaction driven primarily by ease of use, less paperwork needs, and accelerated turn times.
Efficient technology is the highway to lowering origination costs and enhancing customer experience. Fannie Mae's Day 1 Certainty is the vehicle to take [us] down that highway.
Day 1 Certainty has cut the time from loan application to final approval from 50 days to 25.
a win-win, customer’s experience is improved through reduced documentation and accelerated closing dates, while we receive reps & warrants [relief] and operational efficiencies.
What We’re Seeing So Far
Lowering Manufacturing costs/cycle-time Desktop Underwriter Data Validation Service & Single Source Validation Improving customer experience ChatBots (NanoRep/AskPoli), APIs that help in loan data enrichment, drive exception based workflows Business Process Streamlining Policy automation & straight through processing for servicing expenses, Robotics Processing Automation
Innovation
Insights
Co-creating with
Customers
Agile
Test & Learn
Empower-ment
Collaborate
The Digital Operating Model culture has accelerated innovation
© 2018 Fannie Mae | Trademarks of Fannie Mae
RESOURCES
Reference Materials On-Demand eLearning Courses
Job Aids
• DU Validation Service Reference Guide
• DU Validation Service FAQs
• DU Validation Service Testing and Integration guide
• DU Validation Vendor List
• Introduction to Day 1 Certainty
• Implementing Day 1 Certainty: DU Validation Service, Property Inspection Waiver, and Certainty on Appraised Value
• DU Validation Service: Quality Control Overview
View more eLearning courses and job aids on the DU validation service webpage.
• Income, Assets, and Employment Validation Examples
• DU Validation Service QC Considerations
• Day 1 Certainty Prefunding QC Worksheet
• Day 1 Certainty Post-Closing QC Worksheet
denotes resource is accessible with Fannie Mae SSO credentials. Contact your Fannie Mae representative to receive the document if needed.
© 2018 Fannie Mae. Trademarks of Fannie Mae.
Thank You! [email protected]