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Robotic Process Automation Changing the Dimensions of the Mortgage Industry


The mortgage industry is undergoing a significant shift in process optimization due to many factors including Covid-19 as well as consumers' demand to bring more efficiency. Since the North American region is severely affected by the pandemic, the workload on mortgage providers has grown to become unreasonably higher than before. Therefore, lenders opt for Robotic Process Automation to replace human-dependent processes in order to speed up the E2E functionality for current and queued clients.


What is RPA?

Before diving into its advantages, let's first understand the term and how it provides operational excellence.


To set the perspective here, it is worth noticing that RPA can execute several tasks that are performed by your workforce (humans) on a predefined set of functions. This shift from humans to technology reduces the probability of errors and ultimately, increases your ROI.


Talking specifically about its usefulness in the mortgage industry, it can detect objects (documents, data, faces, etc.), perform automated analysis on the given guidelines, execute keystroke replication, and a lot more.


Technically speaking, it happens to be the utilization of technology (i.e. Artificial Intelligence) that allows automated software to capture and analyze a mortgage application before providing a response, depending on the lending organization's instructions.


If we chunk this information down, an RPA software (just like the one offered by FundMore) runs on a defined set of rules and sequence of actions, native to a particular mortgage lender. It is essential to realize that even though this technology is sophisticated at its core, the users just have to configure a few settings from the GUI, so it's easier than you can imagine.



The Pros of Using Robotic Process Automation in the Mortgage Industry

Every innovation that is bringing disruption in the FinTech sphere must be adopted if you want to keep your business afloat during the Covid-19 pandemic and onwards. To give you a quick insight regarding RPA's high adoption rate and acceptability, it is worth noting that according to a whitepaper published by Infosys, this market is expected to be worth about $5B in 2020 – which is more than a 2500% increase from its value in 2013.


Let's explore the immediate areas that are revived with the use of RPA in the mortgage industry.



The use of AI can enhance your turnover time during application processing. Once the borrower submits his/her application, several tedious tasks must be performed to determine his/her eligibility and verify the legitimacy of documents. All of this can be automated with a few clicks to save you time and money.



This is the most critical aspect for any mortgage lender, where the organization must evaluate the risk of providing the mortgage to any individual. Since several checks are involved, including the evaluation of income assessment, tax returns, MERS verification, credit reports, and many more, it is ideal to adopt an AI-based tool that does the same amount of work in significantly less time with a low probability of error.


The use of RPA for substituting your manual underwriting process can increase your Return on Investment by generating accurate results and preventing you from making wrong credit evaluations.


Loan Administration

Just providing a loan after the initial evaluation is not enough, and you must monitor different parameters periodically. But would you stay busy administering the already released loans or prefer reaching out to more clients and getting more business? Of course, you would choose the latter!


You need to access an automated tool, make a couple of clicks to update some parameters of the loan agreement, and the rest of the changes at the backend are handled by the software itself. For example, the U.S. government rolled out an act and requested that many mortgage providers be lenient and provide extensions to their borrowers due to the pandemic. 


Now, look at this situation from your perspective – if you are handling 100 mortgage clients, it will become a tiring task to make changes in the contracts manually. Why don't you implement an RPA that can take care of immediate and long-term changes for you?



Although a mortgage lender has a comprehensive and unified compliance policy for running the organization, it happens to be a crux of several regulations imposed by the government and different organizations.


With the help of RPA, you can introduce real-time validation for a variety of documents and images, perform automated testing on different sets of data simultaneously, and even have an automated internal audit before presenting your numbers and progress in front of an audit firm.


Since the market is quite regulated, you can reduce some of the labour by implementing RPA tools that keep logs of all the actions and transactions occurring within your company. Therefore, whenever the reports are presented to the auditors, the probability of human errors stays at its minimum (if not zero!).


Otherwise, you would have to generate each report manually by keeping the metrics in mind, which is not always feasible anymore, given the recent influx of new mortgage applications in the pipeline.


Fraud Detection

Wherever finances are involved, the likelihood of fraud always exists, and as a lender, you certainly need a robust strategy/tool to address this crucial issue. The RPA tools in the market are loaded with real-time risk detection and management solutions. Apart from raising flags, these tools also provide options to manage potential fraud.


To give you better insight, please note that all data received from the borrowers is scanned against their financial history and public databases of known defaulters. As such, even if you skip a fraudster (which is almost impossible in RPA) during the underwriting and origination phases, you can catch them later before they cause any damage.



Although the Robotic Process Automation is relatively new in the market, particularly in the mortgage industry, it is proving to be disruptive, as indicated in multiple reports.


Moreover, since this industry is entirely process-oriented, it is always a good idea to pursue automation to maximize efficiency, save costs, and reduce the chances of errors.

Customer satisfaction matters the most to every business, especially when finances are involved in such huge amounts. So, instead of processing an application in several weeks, it's always wiser to pursue automation that can serve tens of customers at the same time with better quality service and much faster cycle times.