When was the last time you updated your loan origination system (LOS)? In the last year, lenders have had to completely transform their processes while evaluating their existing LOS. As lenders aim to provide a fully digital loan process for borrowers, they need an LOS that improves efficiency, maintains low costs and is compliant with new and changing regulations.

In the wake of the pandemic, competition for the surge of new business is ramping up, and lenders that aren’t prioritizing their LOS are falling behind. So, how do you know when it’s time to update your LOS?

Here are four signs…

1. Performance issues
   An outdated LOS is almost always accompanied by performance issues resulting from system latency. System lockup is a common problem and occurs when lenders try to run multiple sessions simultaneously while using an old LOS. When this happens, lenders are unable to access the necessary programs without closing certain critical applications, resulting in major inefficiencies.
2. Stagnant roadmap lacking innovation
   Your LOS is likely out-of-date if it is modernized inorganically. Software providers should invest in upgrading the product, including the database and user interface. It is not enough to add modern features to an old platform – companies must make changes to the product at its core. When an LOS issues continuous product updates, it streamlines workflows and significantly reduces error rates and origination costs while boosting production efficiency through automation.
3. Lack of a configurable workflow
   If you’re struggling with monolithic workflows, it’s likely due to poor configurability. Configurations enable lenders to modify systems and processes to better meet their company’s individual needs. If your system is outdated, making these modifications can be costly and often requires time consuming and extensive programming. When lenders have the flexibility to tweak their workflows, the result is a more efficient loan origination process.
4. Consistent increase in the cost of origination
   Lenders with a legacy LOS tend to experience a higher cost per loan. There are several reasons for this such as the need for ancillary solutions to complete the solution stack, high cost of upgrades, third party IT support, or inconsistent price variations based on vendor dynamics (e.g. acquisition of a vendor). An automated LOS should reduce processing costs, which allows the lenders to do more with less.

Decisions regarding your LOS will affect your company for years to come, making it important to follow certain parameters when considering an upgrade.

Here are four points you should consider, while upgrading your LOS:

1. Comprehensive functional coverage
   Lenders should look for a feature-rich, configurable LOS that creates a superior lending experience. A LOS should be highly automated, multi-channel, multi-asset, workflow-driven, and preferably a POS + LOS solution, to reduce overheads while delivering superior user experience.
2. Improved borrower experience
   Lenders must be able to interact with borrowers from any channel (branch, internet or mobile) during application intake and after submission. The LOS should deliver a digital experience that minimizes cycle time and facilitates a seamless experience. It should also offer an intuitive user interface that provides the user with an easy way to view what to work on next and what is coming up with optimized loan productivity dashboards that improve the lending experience.
3. Direct access to the cloud
   As borrowers’ demands evolve, streamlined communication and digital engagement have become increasingly important to all participants in the mortgage lending process. With direct access to the cloud, lenders can meet consumers wherever they are – whether in-person, online or on a smartphone – and offer a flexible and frictionless lending process. With a cloud-based LOS, companies can make continuous updates and improvements in half the time. Additionally, systems are more secure and easy to use for both the lender and the borrower.
4. Seamless digital extensions
   The LOS should be conducive to digital extensions and add-ons that support expansion into multiple channels and drive engagement. With seamless digital extensions, lenders can leverage emerging digital tools to increase productivity and improve engagement with borrowers, loan officers, brokers, and correspondents. Having access to advanced digital tools differentiates lenders and positions them well for the future.

With increased competition, it’s important for lenders to evaluate their existing LOS and consider whether it’s prudent for them to upgrade. With all the available technology advances and digital processes that are being demanded by savvy customers, those lenders that don’t take advantage of the new advancements will struggle to serve their customers – ultimately falling behind and losing business.

Wipro Gallagher Solutions empowers today’s lenders with a powerful and innovative, digital origination solution, NetOxygen. The NetOxygen LOS platform’s significant and continual dedicated investment goes into improving the underlying technology and usability of the application.

To know more about NetOxygen, and how we would help you in your upgrade decision simpler, please contact us by filling up this form and our experts will get in touch with you.

Sandeep Hinduja

Director of Sales at Wipro Gallagher Solutions

Sandeep is a seasoned sales professional specializing in insight-based, consultative solution selling. His proven track record spans across sales management, sales consulting, marketing, relationship management, and account management.