NMP - December 2016 - 81


make it easier for lenders to
adapt their workflows in order
to ensure strong compliance.
Traditionally, most lenders
manufactured loans like cars
on an assembly line. I believe
this needs to change, however.
A better mortgage process
would be built on a system

that reacts based on the actions
or events that the borrower or
lender takes. For example,
suppose the borrower is
approved for a loan, but in the
middle of the process, the
borrower's mother decides to
provide a gift of $10,000 toward
downpayment. This changes the

loan characteristics. If your
system is not designed to handle
these sorts of dynamic changes,
you could be in big trouble.
You'll have to take the loan off
the assembly line, change it, and
put it back in the proper stage or
continued on page 82

81

NationalMortgageProfessional.com

n National Mortgage Professional Magazine n DECEMBER 2016

new mortgage platform or
navigating a major upgrade
with their current system. Once
they build their own systems,
the DIY lender is not at the
mercy of a vendor that may
change its technology or how
its delivered, or force its
customers to do business
differently. In my opinion, a
lender should never want to
leave the business of creating
mortgages entirely up to a
third-party. Creating its own
system can help a lender
strengthen its hold on the
marketplace, since they know
more about the business than
anyone else. When the owner
of a lender's core technology
is a third party, the lender
never really has that control.
LOS providers like to say is
that their systems can also be
integrated with other software
modules. For this reason, many
lenders choose an LOS and
then add on different solutions
to suit their needs. This can be
extremely cumbersome,
however. Often a lender ends
up with a patchwork of
modules that seldom work
perfectly together. This
"pollution of solutions" can
require lenders to spend more
money than expected and hire
additional IT personnel just to
keep all these pieces running
smoothly. Building it yourself,
and putting as much of what
you need as possible in one
system, can lead to a much
healthier IT environment
overall.
Quality is probably the
biggest benefit to building
one's own system. Adapting to
regulatory changes in 2017
and beyond, in addition to
meeting the requirements of
one's own investors, can be
arduous for the DIY lender.
Lenders can and probably
should integrate third-party
compliance check modules
with their systems to show
investors and regulatory
agencies that they take risk
seriously. Several third-party
compliance providers have
created modules that can be
easily integrated into a lender's
own system.
When regulations change,
having your own system can


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Table of Contents for the Digital Edition of NMP - December 2016

Contents
NMP - December 2016 - Cover1
NMP - December 2016 - Cover2
NMP - December 2016 - 1
NMP - December 2016 - Contents
NMP - December 2016 - 3
NMP - December 2016 - 4
NMP - December 2016 - 5
NMP - December 2016 - 6
NMP - December 2016 - 7
NMP - December 2016 - 8
NMP - December 2016 - 9
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NMP - December 2016 - Cover3
NMP - December 2016 - Cover4
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