Why was there a need for vendor management through automation in the process of closings?
Let’s answer this question in our 3-part article series on how automation enables a faster closing process and simplifies the concept of vendor management.
The mortgage servicing industry itself is a complicated industry riddled with ever-changing compliance rules and regulations. Additionally, mortgage lenders are required to maintain complex relationships with third-party vendors during the entire process of mortgage loan acquisition, contract negotiations, settlements, and the buying of property. Closing hence becomes a lot more complicated simply because multiple stakeholders are required to be in cohesion. These stakeholders are termed as vendors, and each vendor has its specific role to play during the entire closing process. Cohesive communication with vendors also requires multiple touchpoints.
The Issue of Vendor Multiplicity in the Mortgage Servicing Industry:
In February 2012, the Consumer Financial Protection Bureau made it compulsory for servicers to maintain relationships with vendors during the process of mortgage loan acquisition and also be held accountable for it. Hence, the mortgage service industry is to maintains relationships with vendors according to compliance rules and regulations. The problem lies in the issues about vendor management manually as there are hundreds of vendors to be managed at times.
Some of these vendors include:
- Real Estate Agents
- Settlement Agents
- Mortgage Recorders
Dealing with multiple vendors simultaneously can be a challenge for mortgage servicers as it takes time and resources.
How modern-day automated vendor management solutions can help:
Robust vendor management module to manage all your vendors cohesively
A robust vendor management module allows you to effectively manage all your vendors. As a lender, you will be able to automatically select vendors including real estate & settlement agents, attorneys, appraisers, and mortgage recorders. You will also be able to perform vendor due diligence with ease and categorize vendors by geographical location, product types and even rank them according to your preference manually or automatically. Vendor management solutions also provide support for multiple vendor distribution models and allow effective management while keeping track of each vendor’s performance.
Vendor service portal to execute a wide range of services
Automated workflow management leverages the power of automation to make space for multiple vendor management activities. It allows you to implement configurable tracking of background checks, insurance, and license expiration checks. Furthermore, with the self-service portal, you can sign up for a new vendor online. Furthermore, you can place a control on order and service levels for seamless error-free processing.
High configurability to stay adaptive in accordance to the changing industry environment
Modern-day automation solutions for vendor management are highly configurable and designed and developed to streamline the whole process. Hence, these solutions offer greater flexibility and adaptability to perform at par with a lender’s business requirements. For example, onboarding new lenders can easily be initiated through configurable integration solutions. The greater the level of configurability, the greater will be the ability of the system to cater to various needs of a lender, be it integrations with a vendor or for custom report development. Hence, the industry expertise of the people behind the system also plays a vital role.
Seamless workflow management that reduces manual processes significantly
Contemporary vendor management solutions’ primary purpose is to automate the entire lending process. Hence such software provides an automated workflow management module that focuses on an out-of-the-box solution for mortgage lending that eradicates the need for manual processes. Automated workflow management can reduce operational risks through higher-quality management of streamline overall workflow.
Run-time vendor-related notifications that enable lenders to stay ahead of the curve
The new generation of vendor management portals is user-friendly and will notify you when a significant event occurs during your workflow. For example, if a vendor submits a document, you will be notified through the portal so that you are aware of the ongoing activities. Therefore, the notification system allows users to fast-track the entire lending process.
Leverage multiple vendors from a unified vendor portal
A unified vendor portal can elevate your experience in vendor management by streamlining multiple manual processes and allowing you to stay ahead of the curve through seamless communication.
If you are interested in finding out how AtClose provisions a state-of-the-art vendor portal for effective vendor management, get in touch with us here. This is the first article of the series that highlights how vendor management through automation can lead towards a faster and efficient closing.