A while ago we covered the story of how “We’re all tech companies now.” In it, we talked about how the pandemic essentially forced most industries to adapt and innovate using technology as well as some of the challenges and opportunities that came as a result. This time, we’re going to take a deep dive into how that story of innovation can be found in specific industries and the effect that has on the types of jobs that have opened up in those spaces as a result. We’ll be focusing on a few places where we’ve seen examples of high growth and digital transformation. For us, would be the higher education sector, traditional tech startups, and our topic for today: the mortgage industry.
The mortgage industry is an interesting one because companies within it have had a reputation for being more brick and mortar than digital. It’s not that there haven’t been developments by popular companies such as Rocket Mortgage from Quicken Loans to speed up the process of digital adoption pre-pandemic. After all, they developed a highly rated and consistently updated app for customers to manage their business early on. However, when it comes to the idea of digital adoption, particularly in the area of data intelligence, AI and applied Machine learning, the mortgage industry hasn’t been as quick as others to adopt the wave of change like the pharmaceutical or food industry’s have. There’s a lot of sunk cost into the systems/infrastructure that’s already in place. And that’s fed into a fear of losing an already established process and a sense of digital apprehension when it comes to the idea of transforming the current workforce into a more digitally savvy tech force.
But the COVID -19 pandemic and the influence of Big Data made it nearly impossible for that worry to continue to hold as much weight as it did in the past. As a result, mortgage companies have had to make significant changes in the way they operate to get to a point where they can efficiently provide services for their customers in a safe, speedy and productive manner.
One big change is in the workforce. A majority of companies have had to adopt a work from home model to ensure that their workers are kept safe in the pandemic. As time has gone on, working from home has even become a preferred mode of work for most employees. With many even becoming more productive as a result of the switch. This model of business also allowed the mortgage industry to tap into a much bigger reservoir of highly-skilled, tech-savvy remote workers without having to worry about geographical constraints. It’s become very clear that the mortgage industry needs to have tech-savvy people working with them to adopt new processes and technologies from simple video conferencing software like Zoom, to authentication software like Docusign and e-notification systems.
Another big change is the reliance on Big Data. Mortgage companies now need to rely on data collected from the online profiles of their customers to figure who to market to and how best to serve the needs of their clients. By using diverse data sources and predictive analytics, mortgage lenders can “fill in the gaps where traditional data sources fall short. An example of this can be seen with HomePoint Financial. The company has made it a point to rebrand the homebuying journey by providing customizable options to clients made possible because of Big Data. Big data helps streamline a whole bunch of industry processes, from loan assessments to account servicing, reporting and even fraud risk. It helps to establish a more secure and trustworthy process with reduced steps at every stage. Most importantly, it helps to support financial inclusion and diversify the types of customers that mortgage companies can serve.
The last technological adoption to bring up will be Artificial Intelligence(AI), Machine Learning(ML) and automation tools developed through APIs. This is probably the biggest part of the way the mortgage industry handles operational efficiency. Big Data may give them the information, but AI and API technology turns that into something that can be used. According to Sanjoy Malik from the Forbes Council, “Technology like AI, ML, and APIs can help streamline preapprovals, mortgage applications, loan processing, underwriting, closing and post-loan compliance related to VA and FHA loan regulations.” Companies like United Wholesale Mortgage (UWM) from United Shore utilize these tools for the purposes listed above in interesting and innovative ways.
Heavy adoption of this kind of technology changes the kinds of people that mortgage companies look for. As an example, companies like Loan Depot and AmeriSave mortgage have already been hiring people to develop and streamline online management services, create applications that interact with APIs and work with Big Data resources and AI to better understand the user base of their organizations and create systems that can help serve them. Both of those companies have already hosted Virtual Job fairs and made significant efforts to look for talent that suits them. For the mortgage industry, talent has become a much bigger priority of the pandemic era. And from the look of things, it seems that the industry is going to keep looking for that specific kind of tech talent. Not just because COVID pushed them to adopt it but because it helps these organizations effectively meet their unique goals.
Studies have shown that the push to acquire more tech workers and work with other sectors like the fintech industry has helped mortgage companies keep up with the surprisingly erratic behavior of consumers. And, it’s helped them to be so much more efficient through the push by those technology-centric workers to produce online/electronic solutions to traditional problems.
So, what does this mean? It means that technology belongs in the mortgage industry. And as it becomes a bigger part of the industry, tech talent and experienced talent partners will also need to come to the forefront as well.
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