Once a lender acquires the technology to accept Web-based mortgage applications, putting that technology to widespread use is the next step.
Cutting out the step of collecting a paper application saves lenders time and money. Establishing an online channel involves upgrading websites to add the functionality or connecting to an outside provider—typically a website that’s private-labeled with the lender’s logos and integrates with its main website.
As borrowers and lenders have grown more tech-savvy, the online origination channel is growing, according to Scott Happ, president and CEO of Mortgagebot in Mequon, Wis., which provides third-party, Web-based mortgage application services to nearly 1,000 lenders.
Mortgagebot’s PowerSite technology has three channels of specialized online application tools for consumers, branch employees and loan officers. A lender can use all three PowerSite channels to control the online application process and migrate data to the lender’s LOS.
“The online channel tends to generate impressive application volume,” Happ said. Mortgagebot can track specific application metrics and conducts routine lender surveys to better understand how its technology is used. The company recently prepared lender-anonymous data from its universe of customers exclusively for Mortgage Technology.
When a lender originates apps online, it reduces the workload for branch and call center staff. Mortgagebot said 10% of its users take more than half of their applications with these staffers.
But more than 60% of Mortgagebot clients originate more than half of their application volume with loan officers.
PowerSite users can build custom websites that promote brand and loan officer loyalty with borrowers.
Mortgagebot found that lenders are taking advantage of this tool, as 80% of the 6,300 individual Web pages Mortgagebot maintains for its clients are personalized pages for loan officers. Loan officers can direct customers to their custom site to fill out the application, or use it to take the application over the phone or in person.
While this data reflects the operations of only Mortgagebot’s clients, Happ said it is a good indication of where the industry at large is heading.
Mortgagebot recently commissioned a survey of 330 lenders not currently using its technology. Lieberman Research Group conducted the study to gauge the sample pool’s interests in online application technology.
Lenders said they expect their online mortgage application channel to grow from 7% of total mortgage volume in 2010 to 18% in 2013, a growth of 157%.
Only 18% of lenders surveyed currently used Web-based mortgage application volume technology, but more than 70% of respondents said they “envision a time” when they will.
The LRG survey also found that only 13% of the respondents’ application volume is generated by branch or call center staff, and they didn’t expect that to change during the next three years—consistent with Mortgagebot’s clients.
The respondents said two-thirds of their mortgage application volume was handled by loan officers, also similar to the Mortgagebot clients. But the respondents also said online channel growth will result in loan officer applications to decline to 57% by 2013.
