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Improving Efficiencies in Mortgage Servicing

Investments in real estate-focused startups have surged. According to an estimate by Forbes, the total investment in real estate technology was approximately $33 million in 2010. Within seven years, that number rose to more than $5 billion.

For the default servicing industry especially, these numbers mean investing in technology and updating to systems that can help it improve operational efficiencies. And that’s exactly what the industry is doing. According to an article in the April issue of DS News, technology, modernization, and digital transformation were among the top reasons banks, credit unions, lenders, and servicers were investing in updating their systems. And those investments are starting to pay off.

“We invested heavily in both out of the box and proprietary technology to allow us to streamline our interactions with our borrowers, attorneys, REO brokers, and other partners,” said DeAnn O’Donovan, President & CEO of AHP Servicing, a specialty servicer of past due loans. “This allows all parties to have real-time access to information they need to provide prompt responses and make informed decisions.”

And emerging technologies like chatbots and machine learning are helping default servicers streamline, automate, and integrate their operations.

“We’re starting to see a surge of technological innovations that are specifically designed to increase work efficiency across all types of sectors,” said David Karandish, CEO, and Founder of Jane.ai, an artificial intelligence platform for the mortgage industry.

Giving an example Karandish said that chatbots could act as AI personal assistants to help streamline administrative work, freeing up employee time for more productive work. “Off-loading noncritical tasks allows default servicers more time to focus on what really matters - addressing the needs of homeowners and investors. It’s a win-win all around,” he said.

O’Donovan agreed saying that investing in technology had helped her firm reach fast, consensual solutions with homeowners struggling to pay their mortgages. “We view this as giving our borrowers and our business partners more tools in the toolbox to interact in a way that is comfortable and convenient for them,” she said.

Technology has also provided advantages for lenders and servicers to standardize the coordination, packaging, and delivery of loan files for processing. That’s saying a lot in an industry that has historically relied heavily on paper files. Now, technology like blockchain is likely to give it a new direction.

“In the past, title companies worked to collect and verify property documents, but blockchain’s value as an immutable ledger could upend the entire industry,” Karandish said.

Read more about how technology is changing the default servicing industry:

Implementing Blockchain Into Real Estate

Breaking Down the Blockchain Movement in Mortgage

Investing in the Future of Default Servicing

Field Services Technology: Directing Traffic, Driving Progress

About Author: Radhika Ojha

Radhika Ojha, Online Editor at the Five Star Institute, is a graduate of the University of Pune, India, where she received her B.A. in Commerce with a concentration in Accounting and Marketing and an M.A. in Mass Communication. Upon completion of her masters degree, Ojha worked at a national English daily publication in India (The Indian Express) where she was a staff writer in the cultural and arts features section. Ojha, also worked as Principal Correspondent at HT Media Ltd and at Honeywell as an executive in corporate communications. She and her husband currently reside in Dallas, Texas. She can be reached at Radhika.Ojha@DSNews.com.
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