The Rise of the Invisible LOS

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"The LOS will be much more powerful because it can enable any innovation the lender requires to advance its business."

And the value the LOS of the future will provide.

DENVER; Nov. 19, 2020 – As the home finance industry has matured, what began as a tool for storing the information on the borrower’s loan application grew into a structured dataset agreed upon by the nation’s largest secondary market investors and required from all lenders.

As URLA, the Uniform Residential Loan Application, comes into focus, the entire industry will be sending the same set of data upstream into the secondary market with every transaction. In preparation for this, developers of mortgage loan origination systems (LOS), like Mortgage Cadence, have optimized the lender’s database of record to efficiently send this information upstream.

As we move into the future, you can expect there to be fewer distinguishable differences between the various loan origination systems. At their core, they will all offer a pre-configured database optimized to support sales through one or more channels.

So, am I suggesting it’s time for Mortgage Cadence to get out of the LOS business? Not at all. In fact, it’s time to go all in, which is exactly what we have done.

The value the LOS of the future will provide

For years, the industry has looked to the LOS providers to bring new technology innovations and differentiation to the market. Over that period of time, lenders began investing in third party tools, most recently at the Point of Sale. Those tools changed the Loan Officer and Borrower experience, but did not substantially impact the cost to produce a mortgage loan asset. We wrote about this recently here.

As the technology will continue to mature, the LOS will become more than a simple pre-configured database of record. It will become a home base of sorts, allowing for many technologies, all supporting the efficient collection, verification and delivery of this data to investors, to be connected in innovative ways.

The old days of bolting on new tools will give way to a more organic merging of technologies, whether provided by third parties or the original LOS technology partner, that work together seamlessly to efficiently manufacture the loan products the lender sells.

In the process, the industry will see a clear differentiation between LOS platforms that engage innovative technologies to move data seamlessly from third parties into the database of record and those that cannot. The connections will be invisible to the user, but the LOS will be much more powerful because it can enable any innovation the lender requires to advance its business.

To find out more about how the new Mortgage Cadence Platform (MCP) is turning this vision of the future into today’s reality, contact us to continue the conversation.

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

Contact:

Megan Martin

EVP, Marketing

Mortgage Cadence

+1 (516) 480-6765

megan.c.martin@mortgagecadence.com

Mortgage Cadence

Mortgage Cadence

Interested in learning more? Contact us today!

Related Reading

URLA From 1003

What is URLA?

URLA (Uniform Residential Loan Application), a joint document approved by the Federal Home Finance Agency for use by lenders with the intent to sell a closed loan to either Fannie Mae or Freddie Mac.

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