The Channels You Choose

Most people will tell you that the loan origination channel a lender chooses is not, in and of itself, a competitive differentiator and will not, on its own, make the lender more successful. That’s true, as far as it goes. 

But in an environment where loan volume is decreasing overall and refinance activity is falling off significantly, a multi-channel strategy is going to expose the company to more loan sources and that can be a competitive advantage. 

The MBA’s October forecast on loan volumes called for $3.8 trillion in loan originations for 2021, down from $4.1 trillion in 2020. But total originations for 2022 are expected to be closer to $2.5 trillion. In October, purchase money transactions were already making up 75% of the lender’s business. 

Lenders who want to grow in 2022 are going to have to diversify and add new origination channels. 

Moving into a new channel is not something lenders do on a whim. Each business model has its own unique requirements, including staffing, compliance and operating processes. Above all, each channel requires its own technology. 

Or does it? 

One of the most significant benefits of today’s modern loan origination software is that it can be used to originate new loans across a number of channels. Being able to support multi-channel lending in a single tech stack saves money, time on training and generally allows the lender to get a higher ROI from their technology investments. 

A modern LOS stands in stark contrast to technologies that require a separate tech stack for each origination channel. Being forced to go into a different system whenever you want to originate a loan through your correspondent channel is the opposite of efficient. Some technologies require a separate stack for every channel. Not recommended! 

Most lenders don’t evaluate new technologies based on their ability to meet the needs of multiple channels. Often, the heads of each department present their own needs during the technology search and due diligence processes. It’s important to meet these needs, but the ability to meet everyone’s needs through a single technology offers a huge lift to the institution, in terms of efficiency and cost savings, to say nothing of training and adoption. 

If you’re ready to talk to a technology partner that offers the tools to meet the needs of executives operating in all of your origination channels, reach out to Mortgage Cadence today.

By Joe Camerieri, EVP, Client Account Management at Mortgage Cadence 

Want more?  

Follow us on LinkedIn to be notified when our next article is released. 

Media Contacts 

Mortgage Cadence: 
Megan Martin 
EVP, Marketing 
(516) 480-6765