How Choosing the Right Product, Pricing and Eligibility (PPE) Technology Helps Lenders Drive ROI, Scalability and Organizational Efficiencies Regardless of Market Conditions
Mortgage lenders must strike a delicate balance between optimizing their processes to remain flexible and responsive to market changes and adopting cost-effective and scalable technology to achieve greater efficiency in an industry where innovation has historically lagged.
While mortgage technology solutions (e.g., CRM, POS,LOS, etc.) address particular stages of the loan origination process, a pricing and eligibility engine (“PPE”)impacts the entire process. It can serve as a cost-effective solution to realize immediate ROI. While all PPE solutions provide pricing, there are significant differences in technological capabilities between a legacy PPE and a modern PPE. Legacy PPE solutions are proven but unable to scale. A modern PPE is highly configurable from its user interface to its easily manageable back-end, where you maintain loan programs, loan-level pricing adjustments, margin management, and lock desk workflows. All of this can help lenders reduce their overhead expenses while still providing the best service to meet the expectations of their borrowers. Getting the best possible deal for your customers is necessary to win the mortgage business.
What distinguishes legacy PPEs from their modern counterparts primarily relates to a monolithic tech stack and its impact on scalability and performance. However, technology is not what separates modern PPEs. All modern PPE solutions offer scalability because that is one of the critical objectives of new technologies. What distinguishes one modern PPE from another primarily relates to execution, implementation experience, know-how, mortgage expertise, and customer service. The risk of selecting an unproven provider can cost decision-makers and damage credibility. As lenders become more deliberate in their assessment, review, and selection process, the provider’s track record becomes a significant (and oftentimes, determining) factor in winning the business.
Wide Scale Benefits When Choosing A Modern Pricing Engine
1. Scale with business growth and changes in market conditions
2. Reduce operational costs and improve efficiency
3. Uncover the best products and pricing available
4. Price faster with the ability to showcase thousands of products in seconds
5. Improve customer service and the pricing experience with loan originators
Four Main Factors When Choosing A Pricing Engine
As the mortgage industry continues to grow, lenders must have the right resources to manage their operations. Aside from having the right technology in place, providing the best possible customer experience and pricing transparency are vital to driving success in the mortgage industry. This is why many lenders recognize the importance of having the necessary tools to continuously monitor the market, improve efficiency and increase profitability. Having a modern pricing engine is critical to this equation.
Lenders should look for the following when choosing the right PPE in today’s market.
1. Scalability & Configurability
The right PPE can help lenders scale operations and constantly adapt to changes in the market. A modern pricing engine helps lenders improve their pricing and eligibility rules, provide granular margin management, and maintain a scalable operation. It can also help lenders deliver this through configurability and the ability to continuously improve their pricing and eligibility processes. Furthermore, adding loan programs, LLPAs, eligibility rules, margins, and lock workflows should be streamlined, straightforward, and accomplished in a fraction of the time. One of the most critical factors a lender should consider when choosing a PPE is the availability to price thousands of products in under 1 second.
2. Competitiveness
Providing users with the ability to quickly identify the lowest possible rates and best loan programs for borrowers is critical to staying competitive. Today’s borrowers expect a more transparent process that is tailored to their specific situation. A scenario-based product eligibility engine can help lenders provide a more accurate and personalized experience by allowing them to understand which products are most likely to be offered and fit them best. A modern PPE can support all consumer lending products and provide lenders with competitive insight through detailed analytics. The best solution will also enable a lender to outperform its peers in an economic upturn and survive when the tides shift, as we are experiencing in the current market downturn. Not to mention improving efficiency by providing more accurate and timely secondary marketing insight.
3. Full Secondary Marketing Automation & Support
A modern PPE can provide pricing information for all consumer lending products. Adding loan programs, LLPA’s, eligibility rules, margins and locks workflows should be streamlined, straightforward, and accomplished in a fraction of the time. The lock desk is a vital component of secondary marketing operations and significantly increases a company’s profitability. It has to constantly adapt to changes in the market, such as implementing new lock policy workflows and pricing concessions. By implementing more effective workflows and faster processing, a modern PPE can help lenders reduce operational costs and improve efficiency. It can also help them manage their high-volume periods by eliminating manual processes. One of the most common features of an advanced PPE is the ability to automate the lock desk’s various functions, such as auto acceptance of requests, price concessions, and relock requests.
4. Robust Integration & API Capabilities
One of the most critical factors that a lender should consider when choosing a PPE is the availability of modern APIs that can be used to make pricing more accessible to their customers. Take for example, LOS integrations. LOS users have the ability to access Lender Price’s powerful pricing and eligibility engine to price out their borrower loan files, initiate lock requests, access secondary buy/sell pricing and approve or deny lock requests all within their
user interface. They can search and compare best pricing amongst their approved investors instantly. Loan officers can initiate lock requests within Lender Price and automatically update their borrower loan file with lock information and status seamlessly. Secondary Market and or Lock Desk staff can access buy and sell side pricing directly from Lender Price secondary pricing engine and approve or deny lock instantly.
Additional Lender Price Integration Capabilities
– Access Lender Price directly from a mobile device
– Export borrower loan file information directly
– Search for the best rates and loan programs
– Submit lock requests
– Import buy/sell side pricing into Secondary Registration
– Approve or deny lock and update status automatically
The ability to provide various products and services across the mortgage life cycle depends on highly accurate and timely pricing data. Having the necessary connectivity to third-party technology providers is also essential to ensure that the lock desk and pricing data are always up-to-date and provide the best customer experience.
Learn More About Lender Price
Lender Price is now one of the leading companies in the mortgage industry with 8 of the top 12 banks and credit unions leveraging the Lender Price platform. Check us out at www.LenderPrice.com, book a demo, and see what a truly modern and proven solution should look like.
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