Over the last several months, Lenders have been having consistent loan volumes, both in fresh purchases as well as in refinance. Lenders can capitalize on these volumes to eventually increase the market share and make profits. With an increased market share, there is a need to convert loan applications to funded loans (closing ratio), which is a long process. Lenders need to make the process more agile and improve closing ratio, or else it would add more fixed costs and they will end up losing out to competitors.
Ways to Improve Closing Ratio
Metrics: Closing Ratio
When you think of profitability, the closing ratio can be considered an essential metric. PrivoCorp team engaged with limited mortgage diligence experts and distilled five critical action areas to get top results. We are sure that you can use these ideas and strategies that will be relevant to your business.
1. Automate Loan Set-Up
Lenders can use various strategies and tools to automate the loan setup process. With the number of documents that need to be managed, if the setup is digitized and automated, lenders will be able to significantly improve efficiencies here.
2. Leverage Technology Powered by AI/ML
Artificial Intelligence (AI) / Machine Learning (ML) plays a significant and vital role in processing many documents with precision and accuracy. Lenders can gain immediate benefits by using ready solutions and deploy them quickly across their operations.
3. Invest in Pre-Underwriting Reviews
Underwriter’s jobs can be made more accessible by streamlining the process; pre-underwriting reviews and automated QC procedures can significantly help here.
4. Automated and Configurable QC Process
Lenders must ensure compliance irrespective of any partner they work with. Automated and Customizable checklists need to be used so that QC processes can be stringent and can have uniform usage across the organization.
The closing ratio is certainly an important metric when it comes to profitability for a mortgage lender. Having an improved closing ratio can directly impact profitability. If you can implement some of these ideas, you can look to reducing turn time in mortgage processing and improving the closing ratio, as you would be able to close loans faster and continue to maintain relationships with borrowers.
If you are seeking help in mortgage processing or help to improve the closing ratio, do reach out to us. We have been working extensively in the mortgage fulfillment space and have the right skills, people, and technology to help you. Reach out to us at firstname.lastname@example.org