How Technology Helps Lenders Comply with New Mortgage Rules

The rules of lending have changed and both lenders and borrowers are aware of that. Less than a few years ago, lenders were mainly concerned about getting good deals that they would ultimately sell in the secondary market. This is no longer possible.

The Consumer Financial Protection Bureau (CFPB) has rewritten the mortgage lending rules. Consequently, mortgage executives have been asking themselves if their processes, systems and people have also changed with the times.

The new rules put a special emphasis on customer satisfaction. The government now wants lenders to listen to and respond to their consumers. CFPB relies heavily on new technology to engage customers. In addition, the bureau has made it easy for borrowers to express their dissatisfaction with the lender by reporting their experiences on the CFPB portal. The bureau's Consumer Complaint Database will store and manage this information.

Consumers are showing great interest in providing feedback. More than half of the 139,000 complaints registered with the bureau by the end of the 3rd quarter of 2013 are related to the home loan industry.

When lenders are flooded with consumer complaints they will definitely need to rely on technology to resolve the issues. 

Here are some reasons why lenders need to invest in automation to serve the borrower better:

The new rules demand it

The CFPB doesn't ask lenders to employ new technology, but lenders have no other choice because the new rules are very complex. The lender can't comply with the new guidelines without the help of technology. The legacy systems that they use at the moment are not designed to meet the specific needs of the borrowers. These systems mainly helped lenders to process home loans for secondary markets.

Executives are also interested in investing in technologies that will provide a better buying experience to their borrowers.

Emphasis on consumer satisfaction

The federal government now insists that lenders provide a better buying experience to their borrowers. Lenders have never employed people to provide customer service. Since the profit per loan is low, they will probably not be able to afford it either. In this case, automation is the only available solution.

The key is investing in technology which will help the lender use their smaller staff to deliver a better buying experience to their borrowers.

New technology helps it possible for lenders to serve more customers faster.

When profit per loan is falling and the cost of compliance is rising, having happy customers alone will not help the lender to operate profitably. Lenders also need to use technology which will help them serve more borrowers in less time. The lender will receive applications from both qualified and non-qualified borrowers. It is crucial to eliminate those applications that are unlikely to qualify early in the loan approval process. This will save time for you.

Technology also allows the lender to decide how the application should be processed.  This allows the lender to immediately alert the borrower. When the borrower knows the outcome early enough, it will increase their overall satisfaction. This is true even when the lender's decision isn't good for the borrower. Technology also helps the lender provide timely status updates.

Struggling to find buyers that qualify? RealTAG gives you the real estate content that drives consumers to your site, and gives you an inside look at their financial situation. Close more real estate deals and generate qualified leads by contacting RealTAG today!