The COVID-19 pandemic has not only changed the way we live but also the concept of work and the workplace. Jobs that were considered to be done strictly in office premises transitioned into remote jobs while opening the doors for many digitally enabled opportunities. The popularity of the hybrid model catapulted and work from home became the new normal, thus giving birth to a new working structure.
The mortgage industry also transformed as the pandemic accelerated the use of technology and shifted from the usual physical documents and in-person meetings to virtual interactions and e-closings. Employees also shifted their preferences and favored working from home as it allowed flexibility and promoted work-life balance. Although remote working was initially adopted as a stopgap measure, it has now become a workplace norm. Moreover, it has been transformed into work from anywhere.
What is Work from Anywhere?
When you hear the term ‘work from anywhere’, what is the first thing that comes to your mind? Probably an image of a person working on a laptop by the beach. Well, it can be one aspect of the work from anywhere concept. However, when you look at the bigger picture it extends to utilizing a global workforce and not limiting only to the employees in the organization.
How COVID-19 Contributed to the Popularity of Work from Anywhere
The COVID-19 pandemic opened the minds of many C-level executives and decision-makers to the idea of work from home and later work from anywhere. It sparked the question ‘Do you need to go to office to conduct your work?” The pandemic proved that workforces can perform seamlessly while being entirely distributed.
The mortgage industry also adapted to the ‘new normal’ and began utilizing technology to digitize and digitalize the processes that were supposed to be dependent on paperwork and in-person communication. In addition, expanding the workforce beyond geographical boundaries became easy.
What Changed in the Mortgage Industry?
In McKinsey’s American Opportunity Survey, it was made clear that flexible work is no longer a temporary pandemic response but an enduring feature of the modern working world. Although the shift to remote work was a reaction to the sudden crisis, it became a dynamic change widespread irrespective of demographics, occupations, and geographies.
In the mortgage industry, this shift transformed many facets including the adoption of technology and the potential to utilize a pool of talent across borders.
- Chatbots for Borrower Interaction
There was a time when lenders had no other option than to increase the headcount of employees to meet the demand of the surge in customer queries or borrower interactions during the servicing period. However, the pandemic helped in adopting alternatives to this need. Self-service tools like interactive voice response (IVR) or chatbots became the go-to option and turned out to be an efficient way of reducing operating costs in the long run. AI-powered chatbots not only added a personal touch to the conversation but also built stronger customer relationships using advanced natural language processing technology.
- eClosing for Quick Turnaround
eClosing means closing a mortgage loan electronically. It was not a common practice in the mortgage industry pre-COVID because the lending staff would have a physical office where they used to schedule the closing at a time convenient for all the parties involved. However, when the pandemic hit, everyone was forced to work from their homes, thus limiting the physical interactions, let alone meeting for getting the physical signature. That’s when e-closing became popular. No matter where the lender is sitting, they could transfer the ownership of the property through a secure digital environment, using an e-signature. Not only did it accelerate the closing process, but also kept errors at bay.
- AI-powered Tools for Informed Decisions
For a long time, traditional mortgage providers were skeptical of investing in any innovative technology. But COVID-19 pushed them to become technologically armed and leverage Artificial Intelligence (AI) and Machine Learning (ML) to make informed decisions in real time. Lenders started using AI and ML for origination, servicing, and title search functions. With AI, repetitive mortgage tasks can be easily performed with machine-grade precision as well as human-like decisioning capabilities. There was no need for physical document reviews as Robotic Process Automation (RPA) mortgage bots preconfigured with necessary business rules could digitize documents and detect fraud without delay. Also, AI and ML application in the early stages of the default process helped reduce cases of loss mitigation.
- Broadening of the Talent Pool
In the pre-pandemic times, mortgage lenders and servicers were confined to leveraging the talent and experience of the teams that were in their city or country. Moreover, there was an increase in risk for lenders in expanding their footprint in their respective geographies. After the COVID-19 pandemic, when their in-house employees also became remote, it opened the door to new opportunities for mortgage businesses to explore more avenues of utilizing a pool of talent irrespective of their geographic location. The entire world became the labor market.
With the help of offshore outsourcing partners, mortgage lenders and servicers could have a workforce in a different part of the world working for them and offering cost-effective solutions. Maybe this shift fast-tracked digital transformation initiatives during the COVID-19 pandemic. The in-house employees were working from anywhere and so was the offshore team while offering multiple benefits. As a result, an offshore team started working as an extension of your workforce while mitigating risks and reducing cost per loan.
The COVID-19 pandemic pushed businesses to adopt a new way of working. What initially seemed to be a temporary solution for survival, brought out new ways to enhance work productivity, save costs, and stay relevant. The concept of work from anywhere established a new foundation of trust in technology and third-party vendors to leverage the knowledge and expertise of a global workforce that has extensive experience in the mortgage niche. Employees working remotely can now seamlessly function using distributed technologies bringing a change in how the mortgage industry works. The trends suggest work from anywhere and the use of distributed technologies will continue to gain prominence even when everything is going back to the pre-pandemic stage. Businesses that have embraced the geographical flexibility of work from anywhere received a different sense of mobility which is surely going to yield fruitful results in the future.