Why is Workflow Mapping important? If you run a business, chances are that you have a set system in place to complete work and provide services for your clients. Today’s loan origination landscape is forcing lenders to rethink their Mortgage workflow engines to adapt to the new environment. Without a strategic approach to designing the workflow engine, lenders will find themselves battling rising costs and inefficiencies in an increasingly fragmented and competitive marketplace.
Workflow Mapping:
- It is a method to diagram an entire process using different symbols to document process steps and actions.
- It is crucial for businesses because charting the course of a process visually helps you break down complex processes into easy-to-understand, pictorial diagrams.
- It creates an “efficiency roadmap” for your business to figure out the shortest route to complete a set of tasks.
- Mortgage workflow are sequential, detailed depictions of the work activities that occur when selling, originating or servicing a residential mortgage loan.
The practice of process mapping begins by gathering all bank employees involved in a particular process (from upper-level executives to front-line tellers) and then defining each step involved in that process. A process map then takes those steps, diagrams everything visually and identifies any needed improvements.
The Mortgage workflow mapping helps lenders to understand the end-to-end process, including people, workflow, and technology, to address operational, and technology gaps. Mortgage flow charts can be used to prepare for automation or technology implementation, to understand the customer journey, and to reduce low value or wasteful work steps.
The Mortgage Origination Process – Defined from an Operations Perspective
The mortgage loan origination process typically includes all the steps leading up to, and including, the successful closure and funding of a mortgage loan. The process is triggered when a borrower inquiries about a loan, or when a lead is generated through the bank’s marketing channels. The average time to close all loans is 47 days, according to Ellie Mae Origination Insight Report Data.
- Sales & Business Development: Lenders and mortgage loan officers develop relationships with potential borrowers through multiple channels (digital marketing, referrals, branch network, etc.).
- Application Processing: Borrower data is collected and prepared for underwriting. Pre-approval is typically obtained at this point – before the final underwriting decision.
- Underwriting: Borrower data is verified for accuracy and completeness, and used to assess credit-worthiness.
- Closing: Final interest rates and loan terms are locked in here, fees are collected and the borrower’s loan is funded.
- Post-Closing: Loan data is checked again for accuracy and completeness, and the loan is boarded into the lender’s system for servicing (and/or securitization). Loans may also be prepared for sale to another financial institution at this point.
The operational complexity makes it critically important for lenders to come up with a workflow mapping that makes the commercial loan origination process efficient and helps them reach decisions faster. A Mortgage workflow engine can help community banks achieve this goal by providing a “surge capacity” to get loan applications processed quickly and efficiently.
Why workflow mapping is so important?
Lenders need a granular understanding of the end-to-end process, including people, process, and technology, to address operational, and technology gaps. Workflow mapping gives lenders to know all the nuances of the process, statistical information, variants, process exceptions, unusual transactions, bottlenecks, deviations, and potential risks in Mortgage workflow.
- Training – The process maps can be a key component of training new employees. The maps can be given to them so they can see how things should be done.
- Problem Solving – When there are problems in the process, it will be much easier to see exactly where they are taking place. This can help find solutions to the problems much more quickly.
- Standardization – Standardization can reduce operating costs by up to 30% for mortgage lenders, allowing them to price more competitively and expand market share.
- Big Picture – When a good workflow map is in place, everyone can see the big picture. This helps each individual department, or even each employee, see where they fit into the overall scheme of things.
- Compliance – In industries with regulations, a process map can be used to ensure everyone is in compliance with those regulations at all times. The map itself can even be given to inspectors to show how things are done to prove compliance.
- Team Involvement – When creating a process map for a company, all employees need to contribute by working on the steps they are involved in. This team involvement can help keep people engaged and even identify improvement opportunities that may exist.
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Take Five Consulting is a technology company, based in Virginia U.S., that specializes in the Mortgage Banking vertical especially LOS implementation and application development. Take Five Consulting creates and implement mortgage technology and software specifically for Mortgage Industry.
