Sunday, August 20, 2006

Mortgage Cadence: A new trainer on the team

It's getting easier to build really cool technology, but it's just as difficult as it has ever been to get people to use it. Adoption is a constant problem for vendors that invest millions in getting all the bells and whistles built into their platforms only to find that no one takes the time to utilize their power.

Today's new SOA-based core systems are a good example. Basically, these systems use Services Oriented Architectures to enable the loose coupling of disparate systems spread out across one or more networks. Using business rules engines, users can program the system to reach out through the network for services specific to each business case. Even the smallest lenders have numerous business cases that call for different combinations of products and services, so the software has the potential to add all kinds of efficiencies to their operations. If they'll use it.

While just about every lender likes to feel that their operation is unique and so requires the vendor to provide a custom version of its software through custom configuration of a single core processing system. Few lenders feel confident enough to configure the new system on their own.

This is a problem for vendors marketing SOA-based loan origination systems because if lenders don't take advantage of the capabilities, they're likely to switch to another system in search of functionality that is already available but untapped in their existing platform.

Recently, Mortgage Cadence, a Denver-based provider of such systems, appointed Richard L. Click to be its new Vice President of Support to help lenders get more out of the company's technology offerings.

Click possesses more than 20 years of proven customer service experience both from the product and customer standpoint. As vice president of support, Click will head strategic initiatives to improve customer satisfaction and quality, as well as help Mortgage Cadence expand its operations. Click will also help to strengthen Mortgage Cadence’s commitment to its clients by eliminating upfront client issues and efficiently resolving issues thereafter.

He will also oversee Mortgage Cadence’s technical publications development and training (Mortgage Cadence University), with the main goal of improving customer use and satisfaction within these areas. As vice president of support, Click will be an integral part of product development in identifying areas within the system that need improvement. Other duties include enhancing the quality of updates, releases, training, and developing a customer satisfaction rating.

Expect to see more technology vendors paying more attention to the role of teaching lenders how to get more out of their software. It's likely to be a critical success factor in the future.

Trend: Capturing FSBO RE sales commissions

Some estimates put the For-Sale-By-Owner (FSBO) crowd at about 15% of the market. Using NAR estimates of 6.6 million pre-existing units sold in 2006 for an average price of $231,000, yeilds a billion-dollar business. Consequently, a number of enterprising firms are out to aid FSBO sellers in an attempt to re-capture part of that revenue.

Earlier this month, ZipRealty announced a deal to list FSBO properties for a 2.5% commission. The company has a network of agents around the country, all of whom would have access to the FSBO listings.

But another firm may give access to FSBO listings to a much larger audience. Boca Raton, Fla.-based ByOwnerMLS.com announced that it would serve as a multiple listing service for these home sellers and give free online access to anyone searching for a property.

“We believe that the for-sale-by-owner industry is one of the most minimally exposed and fragmented components of the real estate market,” said Dominic Muttillo, chief operating officer for ByOwnerMLS.com. “A unified Multiple Listing Service is an important move towards giving consumers the same kind of access and resource that, until now, only Realtors could afford. ByOwnerMLS.com offers listing companies in this space an ability to have their sellers’ properties advertised in multiple locations on the web, giving each listing double exposure.”

However, this is not the same as the traditional real estate broker MLS systems. According to a press release issued by the company, ByOwnerMLS does not list individual properties itself but gives exposure to all its member sites. Still, ByOwnerMLS expects to bring together virtually every "for sale by owner" listing by acting as a real estate search engine.

This is putting pressure on real estate agents to market their services to homesellers more effectively. Greg Tracy, in his real estate blog, offers some good information on adding value.
Increasing value proposition is not about good service or being an agent who knows what you’re doing. It’s not about being one of the best in your field at negotiating or about how amazing your CMA looks. These things don’t matter because they are all expected. Read on:

SharperLending: Adding to the lender bundle

One of the reasons I enjoy writing about the mortgage lending business is that many aspects of the business seem to fly in the face of conventional wisdom. Take bundled services, for instance.

A few years ago, this was a super hot topic. Technology had finally advanced to the point where it was fairly easy for players in the space to collaborate online, sending transaction details back and forth in a seamless fashion. Conventional wisdom holds that business executives will gravitate toward services that cost less and make completing deals easier. It's the old path of least resistance with a healthy dose of good for the bottom line thrown in. No-brainer. But that's not the way it works. At least not in the mortgage space.

National lenders have found it difficult to standardize their purchasing for deals in different geographical areas. They rely on local providers for some services, internal departments for others and national partners for the remainder. Different products require different providers and pretty soon it gets so complicated that we're back to seeking out best-of-breed specialists instead of a one-stop solution.

But that hasn't stopped Spokane, Wash.-based SharperLending from pursuing the dream of bundled services. The company, which provides a secure Web-based platform that enables lenders to order, store and manage products and services from multiple vendors at a single point of entry, recently partnered with Online Documents Inc., a subsidiary of Stewart Mortgage Information (SMI), to offer lenders access to compliant mortgage documents and simplify the closing process.

The company started out offering browser-based credit reporting back in 1989. Since then, it has expanded out, adding more products and services to its offering until it now has a portal that allows Lenders to access everything they need to close the loan.

New SOA-based software is making it possible for larger lenders to set up their own networks of settlement services, sending out orders and receiving data directly into their mortgage processing core systems. But for every lender large enough to capitalize on the promise of SOA-enabled mortgage processing there are tens or perhaps hundreds of smaller lenders that would rather have someone else make these services accessible to them.

Long after bundled services has faded into the list of forgotten mortgage industry buzzwords, firms like SharperLending, that never gave up on that dream, will realize their return.