The process of mortgage origination is time-consuming and intensive. It is in the best interest of lenders to work with mortgage processing partners who offer a variable pricing option for the mortgage process.
On average, a loan can take about 35 to 40 days to close. During this period, mortgage lenders collaborate with various service partners and vendors in order to manage all the functions related to data collection and verification. Their main aim is to close as many qualified mortgage loans as possible while ensuring that they are following all compliances.
However, the process of mortgage is multi-level and it ranges from pre-approval, mortgage application, loan processing, underwriting and finally closing. A loan is considered closed only when the deal on it is finalized. To reach the process of closing the loan, the lender has to incur several costs on processing the papers at each step. This involves paying for the processing charges on all the files and documentation for every borrower.
The time and procedure involved between the mortgage origination and closing are an intense one and there are chances at each step that the borrower may decide to back out for some reason. Even in this case, the lender still has to incur costs on processing the papers. If the loan is not closed, the processing fees invested by the lender contribute to adding only costs for the lender.
Lenders can leverage alternative disruptive business models in order to optimize the cost and time involved in the mortgage process. One of the best approaches is to work with a mortgage processing partner who can offer variable pricing. Mortgage processing partners help in several ways to reduce the cost while consistently offering ways to streamline other mortgage-related operations.
Outsourcing to such mortgage processing partners means they will charge the lender processing fees only for the loans that are actually closed. Mortgage processing partners will also take up the onus of speeding up the decision-making process, decreasing the likelihood of a borrower bailing out of a loan application and closing the maximum number of loans. Such companies can offer immense expertise since they have highly qualified individuals who can take care of all the tasks related to the mortgage process including collating and organizing all the necessary documents from the borrowers. They take up the responsibility to handle the variety of documents including proof of employment, Federal tax returns, bank statements or balance sheets, etc that determine the borrower’s creditworthiness.
The end result is that the lender will have to pay only for funded loans and skip incurring costs on loans that are not closed. Besides, by outsourcing mortgage processing to such innovative companies, lenders can reduce their regular handling costs by as much as 40 percent. Lenders can partner with mortgage processing companies who can manage the cumbersome processing work while they focus on other business aspects. The teams ensure that almost real-time data is available for the business when they need it.
But most importantly, for lenders, it’s a huge benefit when they are required to pay only for funded loans and not incur unnecessary costs on loans that have not closed. By outsourcing to mortgage processing partners, lenders can streamline their operations and benefit from improvements in accuracy and efficiency. They can close loans faster and maintain the lowest possible cost per loan. A faster turnaround time frame also means lenders can take up more customers and keep up with the increase in customer demand.
Companies like PrivoCorp are one of the leading mortgage processing partners who can offer variable pricing by providing a combination of mortgage experts and industry best practices. The company undertakes the process of arranging the documents from borrowers while reducing the chances of borrowers dropping out. They ensure that lenders are charged only for the funded loans and do not waste resources over those that don’t close.
If you are looking for an experienced mortgage processing partner who can offer variable pricing, PrivoCorp is the right choice. Get in touch with us to outsource mortgage processing services to our experts. Talk to us today!