Mortgage Automation: Shaping the Future of The Mortgage Industry

Posted on 22nd August 2023

Mortgage automation has revolutionised the way to provide lending services to borrowers as well as lenders. For those who don’t know, a mortgage is a loan that is financed to purchase real estate property like a house or an office.

Suppose a person wants to buy a house but does not have enough money to buy this house upfront then he can borrow money from a bank or lender this loan will be called a mortgage.

The global mortgage lending market was valued at $11,487.23 billion in 2021 and is estimated to reach $27,509.24 billion by 2031, growing at a compound annual growth rate of 9.5% between the forecast period of 2022 to 2031.

Mortgage automation has been shaping this industry in a modern way by saving time and increasing the efficiency of the whole process. In this article, we will discuss how mortgage automation is changing the loan industry single-handedly. Keep reading with us and by the end of the post, you will get answers to your questions.

Understanding Mortgage Automation:

Mortgage automation is the integration of technology to streamline the workflow and increase the smoothness of loan processing. Mortgage automation is not only a word, it is a complete trend shift that has a great impact on the mortgage industry.

Mortgage automation saves a lot of time that was previously wasted in underwriting, paperwork, document verification, and application processing. With the help of mortgage automation, all of these steps could be completed in a matter of seconds.

It also reduces the chances of manual errors, increases accuracy, and enhances the customer experience which is why it is a source of relaxment for both lenders and borrowers. Mortgage automation uses technology like Artificial Intelligence(AI), Machine Learning(ML), and Robotic process automation(RPA).

The Current Landscape of the Mortgage Industry:

Traditional mortgage processes have long been associated with mountains of paperwork, manual data entry, and prolonged waiting times. These drawbacks result in delays in the process and borrowers had to wait for months and months to complete their processing to go on to the next step.

This was the time when innovation needs badly and as it comes people adapt to it in no time. The mortgage industry is now growing by leaps and bounds in every country just because of this technology.

Technological Advancements Driving Mortgage Automation:

Enter the technological advancements that are propelling mortgage automation forward. Some of the basic technologies which we have been using in mortgage automation are Artificial intelligence, Machine learning, and Robot process automation.

All of these technologies decrease the chances of manual errors and increase the accuracy, speed of the process. Moreover, chatbots have also been very useful in this process because they give instant responses and provide complete guidance to borrowers as well as lenders.

Benefits of Mortgage Automation:

The benefits of adopting mortgage automation are multifold. Imagine a mortgage application process that takes hours instead of weeks. We all know that automation is a hundred times faster than manual work and reduces errors by a significant amount.

It also increases the flow of work and provides enhanced customer experience as well as satisfaction. It means there are various benefits to using mortgage automation instead of manual work.

Challenges and Considerations:

While there are a lot of advantages at the same time there are some challenges we have to face in the mortgage industry which is given below.

Mortgage applications always contain a lot of sensitive data which must be kept safe and secure. At the same time human oversight can also create some issues, we know that automation can streamline the process but there are some points where humans need to check out.

Conclusion: Embracing the Future with Mortgage Automation:

In this article, we have discussed how automation is shaping the future of the mortgage industry. In traditional mortgage methods, a borrower has to wait for several weeks to get the paperwork done and other necessary documentation for borrowing money.

But automation has changed the way this process was completed, now all the work that requires weeks can be done in a matter of a few hours. This development has brought a revolution in the mortgage industry which is now making progress as I have given stats at the start of the article.

Author

Stacy Dubovik

Financial Technology and Blockchain Researcher

Stacy joined ScienceSoft in 2020, bringing in her expertise in large-scale digital transformation projects and practical knowledge of the finance domain. Stacy frames ScienceSoft’s service offerings and technology guides in corporate finance, BFSI, DeFi, and blockchain. She works side by side with business analysts, software architects, and developers to help create innovative solutions that bring unique client value. Stacy continuously monitors customer expectations and technology trends in the BFSI market and explores the newly-emerging fintech and blockchain products.