loan servicing software community bank small business


The defi Team defi INSIGHT

lending process services

Whenever I fix something at home, I gather everything I’ll need to make it happen: tools, supplies, instructions—the lot. Sometimes I even finish without extra trips to the garage or the hardware store. That’s when I know my prep paid off by eliminating extra steps.

The same can be said for the lending process. If you’re properly prepared, if you have all the latest tools and supplies at hand, your lending process services will be far more efficient—especially if the tools are designed to work as part of an integrated whole.

How Integrated Lending Process Services Can Improve Your Loan Program

Tools that bring an added level of efficiency to lending processes include:

  • Web for easy deployment and accessibility
  • Automation to improve process efficiency
  • Quality data sources for better lending decisions
  • Integrated servicing for continuity in customer service

Lenders with these capabilities have a competitive advantage: They’ll realize lower transaction costs, better portfolio performance, and an improved loan program. Moreover, these tools can produce greater results when they are all part of the same integrated system—helping your loan portfolio grow sustainably while preventing extra requests for information.

Loan Origination Accessible from Nearly Anywhere

A lender who makes the loan origination process available nearly everywhere—home, dealer, partners—immediately increases the likelihood of getting more loan applications. Cloud-based lending solutions are available anywhere with internet access and a browser.

Unlike older legacy systems, there are no inherent barriers to implementing web-based loan origination systems (LOS). You don’t have to worry about educating applicants on minimum system requirements and the like. If they can use a browser or mobile app, they can apply for loans. As your lending volumes grow or you need to accommodate heavy demand cycles (Saturdays, end of the month), the cloud allows your loan origination process to easily and quickly scale accordingly to efficiently manage demand. Lending solutions delivered by the cloud also offer the benefit of frequent software updates. These let you take advantage of the latest improvements in lending software functionality.

Easy and secure accessibility, the ability to capture a larger number of applications, and the latest lending functionality all help improve your lending program.

Automation for Lending Process Service Efficiency

Many lenders have way too many manual tasks in their lending processes. That hurts productivity, often introduces errors, and leads to inconsistent decisions—with the potential risk of disparate impact claims. A modern loan origination system automates unnecessary manual steps, streamlining tasks and improving process flow.

Rather than relying on an underwriter to manually evaluate certain borrower characteristics, business rules automatically evaluate manual tasks and determine the next step of the process. If certain thresholds are not met, the application can be declined without further review. Loan terms for applicants with subprime scores can be calculated based on borrower characteristics. If the application requires professional judgment before taking any further steps, it can be moved to a review queue.

Automation also brings benefits that can be measured in time and dollars. A few specific examples of how automation can noticeably improve your loan program include:

  • Application processing time is reduced, allowing you to process a larger number of applications using existing personnel. 
  • A faster process allows you to respond to qualified applicants faster and capture more loans.
  • Lending decisions are consistent.
  • Replacing manual steps with automation results in a more integrated task flow that reduces transaction costs.

Data for Quality Lending Decisions

Besides faster loan application processing, better quality loan decisions help your loan portfolio overall. Your ability to carefully qualify applications, fund those that meet your portfolio goals, and manage them through payoff begins with integrated use of data. And all of that means a healthier lending program for you.

In addition to standard credit data sources, there is a growing number of alternative data sources. These enable you to generate a more detailed and accurate borrower profile—one that includes credit history and helps you predict future borrower behavior.

Combining alternative data sources with standard credit data sources allows you to:

  • More carefully evaluate and qualify subprime applicants
  • Have greater confidence in the quality and consistency of lending decisions
  • Optimally structure loans based on a wider range of relevant individual borrower characteristics

 Servicing Completes the Loan Lifecycle

In an integrated lending process, loan management and servicing use all of the borrower information previously established during loan origination and funding. There is no need to transfer borrower data and records to another system. Agents have immediate and secure access to all borrower information and history.

In the event of customer inquiries, notification of delinquency, or any other activity requiring agent expertise, agents have the tools that provide a complete view of the borrower to properly advise customers. Agents can manage status changes, redirect how accounts flow through the queue, or employ automation and decision rules to manage frequently occurring servicing tasks. Automation also manages monthly statements and records payments, updating customer payment and balance records accordingly.  

Servicing may be the greatest beneficiary of an integrated lending process. By having all relevant borrower information—from loan origination all the way to the most recent payment—immediately and securely available (very similar to having all the tools and supplies needed to complete a task), agents are well prepared to respond to customer inquiries, provide guidance, and resolve problems efficiently, and at a lower cost per inquiry.

Integrated Lending Process Facilitates an Improved Loan Program

Do you have all the tools and supplies you need to cost-effectively manage your loan program? Are there capabilities that would significantly enhance your ability to be successful? Compare your current lending software against this list of limitations:

  1. Difficult to deploy to new clients
  2. Inefficient manual tasks
  3. Inability to take advantage of data sources that provide a more complete and accurate view of applicants
  4. Servicing capabilities not fully integrated with origination and funding data and processes.

If this sounds too familiar, consider the advantages of evolving to a solution that integrates processes and data throughout the lending lifecycle. The benefits to your loan program will be reduced transaction costs, better quality lending decisions, and greater customer satisfaction.

defi SOLUTIONS provides a flexible, integrated lending software platform that gives small to large lending institutions the solutions they need to compete in a competitive lending market. Our integrated loan origination system (LOS) and servicing offerings are completely configurable and quick to implement and provide actionable insights based on actual performance. Contact our team to discuss your specific lending interests. Or, schedule a demo to see how our solution can help you improve your loan program.

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