Point-of-sale (POS) solutions are a critical component in the mortgage ecosystem, but now, more than ever, lenders are looking for their POS to deliver more. As the industry continues to evolve from record-setting peak volume, followed by record-setting low volume, lenders are evaluating how they can improve their operations and increase productivity — all while keeping costs down. Doing more with less — and for less— is the name of the game, with an emphasis on upgrading tech and rightsizing staff to be ready when volume returns. Thinking of a POS as simply facilitating the application is out; thinking of a POS as a more comprehensive tool, a “POS plus” if you will, is in.
Here are three things lenders are expecting from their POS in order to respond to a new kind of mortgage market.
A POS that increases efficiency and reduces the cost per loan.
The reality for the new mortgage market is that lenders are, first and foremost, looking for a POS platform that will make the process faster and require fewer people to do it. The investment in a POS must deliver a valuable return on the overall process in terms of saving money, time or both. Saving time on each origination allows lenders to assign more accounts to more loan officers, which reduces the cost per loan. The time savings also allows loan officers to spend more time deepening their relationships with their referral partners in order to gain more business. Increased automation that comes with tech-enabled POS solutions, like the Cloudvirga Horizon POS, not only saves time, but improves compliance, reduces mistakes and decreases rework with an intuitive, cost-effective system.
Beyond cost savings, one can’t ignore the benefits of an enhanced borrower and loan officer experience that comes with a more automated “POS plus” type solution. The ability to develop customized business rules enhances automation and, as a result, increases workflow efficiency for loan officers and improves communications and collaboration with borrowers. Real-time updates, notifications and alerts keep the process moving by informing loan officers, underwriters and borrowers when changes occur that require action. This translates to a reduced overall timeline and avoids the back and forth of securing and updating documents that has traditionally defined mortgage origination. For borrowers, the result is a crisp process that lets them easily communicate with their loan officer in a single, user-friendly environment, including via mobile app and SMS text messaging, depending on their personal communications preferences. For loan officers, an intuitive, automated system removes the guesswork and delivers a repeatable process that makes it easy to get their job done faster and, therefore, handle more volume.
A POS that meets younger borrowers where they are.
It will come as no surprise to lenders that the way people buy homes is changing as younger, more tech-savvy generations come along. The inevitable demand for quick, digital mortgage lending from up-and-coming homebuyers, including Gen Z and beyond, calls for a “POS plus” that meets these younger buyers where they are. Lenders shouldn’t think of how the mortgage application-to-close process used to be, but rather where it’s going and, importantly, how they can use the current slower market to invest in the technology that will ensure they’re ready when volume returns. And if a lender isn’t ready with an enhanced, automated POS platform when the market returns, they’re already behind and could have trouble playing catch up.
These younger demographics have different expectations from a customer experience point of view. They grew up with social media; fast, digital access to information; and instant delivery of goods and services. They want that when they order a pizza, buy a car, and with a mortgage process too. They expect a frictionless experience and are very comfortable dealing in a fully automated environment. That said, they still need hand holding and guidance — particularly for first-time homeowners — for a purchase that is typically the largest investment for someone.
Beyond the benefits of efficiency, cost savings and improved productivity, tech-enabled POS solutions instantly communicate a lender’s sophistication which improves its brand perception and competitive advantage. Nothing will turn off a younger borrower more than a dated platform that suggests the lender hasn’t kept up with the latest in technology and borrower-focused engagement. A POS that offers a seamless, digital borrower experience is not only attractive to these new buyers, it’s demanded from them.
A POS that delivers expanded functionality and borrower-centric features to create stickiness with customers.
As the new mortgage market continues to take shape, lenders will no longer be satisfied with a POS solution that is limited to the application component. To be competitive, lenders need a solution that can work with prospective borrowers throughout the entire process, beginning when they first think about buying a home through final loan closing.
Connecting the POS to a front-end lead-gen component for the home search process, including scenario building, is a perfect example of a “POS plus” feature. With scenario building, prospective homeowners can explore various pricing, location, home size and feature scenarios to determine what they can — and want — to afford to buy. This goes beyond mortgage calculators that tell borrowers how much a payment would be with certain down payments and interest rates. Future-state POS solutions will help borrowers — and loan officers on their behalf —identify things like outstanding debt that could be reduced to improve their purchasing power or affordability questions that borrowers may think are barriers, but in fact could be easily addressed. AI-powered modeling can deliver borrower-specific demographic analysis, within the confines of fair-lending standards, to help loan officers and their borrowers identify their best loan options. These data-driven insights will deliver unique, borrower-focused decisioning that will further improve customer relations.
Building a channel by which lenders can manage, maintain and monitor prospect activity keeps potential borrowers in the pipeline and can seamlessly move them from home search to application to ultimately closing a loan. There’s a lot of data that indicates that the lender that provides information early in the homebuying process, as well as the first pre-approval will be the lender a borrower stays with because most borrowers don't have the time or interest to shop around. These combined services not only create involvement and engagement with the customer, but importantly, mitigate risk up front so that no one’s time is wasted.
For more information on how to best navigate the new mortgage market, schedule a chat with our team today.
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