Risk management and regulatory compliance have emerged as the most crucial aspects concerning the mortgage services sector. Analytics and big data are assuming significance as well, with the industry being exposed to rich collateral and consumer data, which in turn determine the behavior, risk, valuations and borrower preferences. In order to drive value into business, organizations have to strategically manage the data with maximum efficiency. Most importantly, the focus has again shifted to the borrower, with attempts at the core level towards advancement in predictability, loss prevention, retention and speedy approvals.

Entrepreneurs have a Tough task Ahead

With the market getting tougher and unpredictable, every entrepreneur has to develop an agile and flexible business model. In addition, with the current rate of commoditization, smaller organizations unable to fill the gap would soon become irrelevant. Therefore, innovation-oriented projects have to be materialized in accordance with the requirements that change constantly. Hiring the right fit has always been a tough task for business owners worldwide, and so is the case with the current mortgage industry. The present situation could afford only the right talent with an eye for the right opportunities and deliver the best at any cost.

The upcoming years might observe a drop in the number of new ventures as the rates are expected to rise from an all-time low, driving production to about $1T.

Adding to the complexity of the situation is the predicted increase in fixed loan rates which were more or less constant for almost three decades. In this scenario, there is a strong focus on new purchases that are expected to reach 1M in the current year. The imminent years are likely to be demanding and for the industry to evolve, unique and superior strategies that are faster and yielding need to be incorporated.

Arriving at the Right strategies

The current trends are demanding and highlight the urgent need for an over-all improvement. Recognizing the vulnerability of the situation, the following strategies appear to be relevant.

Adopting cost-effective strategies; the focus should be on minimizing origination and service costs without compromising on the quality of services executed.
Better utilization of technology; For instance, instead of processing platform, the cloud technology would yield better results as a business differentiator. (As told to Anitha)