Modernizing home equity lending 7 key questions to ask

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Home equity lenders are increasingly realizing the necessity of comprehensive digital lending platforms. Looking beyond the point of sale toward solutions that comprise a holistic view of each borrower, lenders can satisfy their customers and unlock new sales opportunities.

Today, home equity customers expect digital experiences that offer the same intuitive design and seamless functionality of the consumer apps they use every day. However, not every digital lending platform on the market can promise that. Plus, most organizations lack the in-house resources to build their own solutions. 

If you want to digitize the home equity lending process, ask your vendor these seven important questions:

1 - How do they approach data security?

These days, it can seem like every time you read the news there’s a fresh story about companies mishandling their customers’ private data. In fact, the number of significant data breaches - those impacting 100,000 or more people - is rising fast. According to USA Today, cyberattacks increased by 47% between 2017 and 2018. This period included the massive Equifax data breach, which exposed the records of 143 million Americans. Surprisingly, malicious actors aren’t solely to blame for these damaging events. 

For example, in April 2019, Facebook announced it had experienced two major data breaches caused by its own negligence and poor security standards. The tech giant uploaded the email addresses of 1.5 million users without their consent over a two-year period. Later, two third-party app developers publicly exposed 540 million Facebook user records on Amazon’s cloud computing servers. 

A single data breach could forever tarnish your organization’s reputation. Furthermore, the average cost of a breach is $7.91 million, per a 2018 Ponemon Institute report. In an industry obsessed with privacy, it pays to work with software vendors that take security seriously.

2 - Does their platform integrate with essential software?

While software solutions should have a robust set of features and functionalities, no single platform can do everything on it’s own. To truly serve the borrower needs, digital lending platforms must be able to integrate with the most-used and best-in-class loan origination systems  and crucial verification systems to pull data from various sources.

Ask your provider if their solution integrates seamlessly with:

  • Loan origination systems (LOS)

  • Customer relationship management platforms (CRM)

  • Product pricing and eligibility solutions (PPE)

  • Home owners insurance services (HOI)

  • Verification services

  • Government-sponsored enterprise entities (GSE)

  • eSign and document delivery solutions

3 - Do they conduct ongoing usability testing?

Years ago, a digital user experience was considered sufficient if users could make their way through a menu system without encountering a bug. There was little concern for the user’s time or resources. However, the prominence of smartphones has created a competitive arena in which developers must create amazing user experiences or risk losing customers.

According to a recent eMarketer report, the average US adult spends 3 hours and 35 minutes on mobile devices every day. The channel is expected to surpass TV viewership by the end of 2019. These users expect their digital experiences to be easy to navigate. When they use a new piece of software, it should just work.

This point is extremely relevant to lenders, considering that a Mortgage Bankers Association survey of chief technology officers revealed that consumer adoption of internet-based mortgage applications is on the rise.

So when you’re speaking with digital lending platform providers, it’s not enough to see that their solution works well today, because user expectations are constantly evolving with the market. You need to ask about their understanding of user-focused design as well as how they incorporate real user feedback into their UX.

4 - What does their development roadmap look like?

Organizations that value innovation don’t wait to react to changing market conditions or competitive disruptions. They use the data and tools available today to get ahead of the curve. They don’t just rise to user expectations; they set new standards.

As user needs change, new technologies emerge and compliance standards evolve, you should be able to trust that your vendor has a roadmap to stay relevant. After all, if your digital lending platform provider is continuously improving, your organization will gain new benefits over time. This could include the ability to consult on important projects as well as regularly updating their product. 

5 - Can they promise enterprise-grade uptime?

One of the primary customer benefits of a digitized lending process is the ability to complete tasks whenever it’s convenient. Home equity borrowers should be able to submit information and respond to messages whenever they wish, whether that be late at night, early in the morning or during their lunch break.

If your digital lending platform isn’t available when customers want to use it, they might never come back, and that costs your organization time and money. According to Gartner, the average cost of network downtime is $5,600 per minute, or $300,000 per hour. In today’s world of cloud computing, there are very few excuses for unnecessary downtime. Ask your vendor what level of uptime they can promise.

6- Is their solution ADA compliant?

Increasingly, business websites are at risk of disability discrimination lawsuits. The Los Angeles Times reported that more than 1,000 website accessibility lawsuits were filed in the first six months of 2018, representing a 90% increase from 2017.

To comply with the Americans with Disabilities Act of 1990, websites must be accessible to disabled people in the following ways:

  • Written content must be coded in a manner that screen-reading software can produce an audio translation.

  • Video content must include descriptions for deaf users.

  • Interactive functionalities should have a keyboard equivalent command for users unable to use a mouse. 

Though federal guidelines pertaining to website accessibility are vague, experts agree that following the Web Compatibility and Accessibility Guidelines ensures that people of all abilities are able to share the same level of user experience. 

7 - What does their track record look like?

You can’t really say you’ve done your due diligence until you check your provider’s reputation. Take a look at their client roster and customer service reviews to determine if you’re ready to move forward with a partnership. Remember, their digital lending platform may be one of the first things your customers see, which means it will be heavily associated with your brand. 

Your partnerships are a reflection of who you are, so take the time to check your provider’s references and business history before signing a contract. 

As you uncover the answers to these crucial questions, think about how your digital lending platform provider supports your organization’s goals, such as:

  • Providing a captivating user experience

  • Gaining a complete picture of each borrower

  • Identifying new sales opportunities

  • Reducing time-to-close rates

  • Increasing application completion rates

Learn more about how to delight your home equity customers by downloading our free eBook today.