Delays in approvals could be reduced if lenders and brokerages harnessed technology that provided them with up-to-date and accurate calculations, according to NextGen.Net.
Following blowouts in lender tunaround times, particularly in the broker channel, brokers have been calling on lenders to ensure that credit assessors are applying lender policies consistently to help reduce unnecessary requests for information.
According to NextGen.Net, the technology solution provider behind the ApplyOnline lodgement platform, lenders and broker groups could also ensure that they fully utilise available technology to remove some of the common roadblocks experienced.
As an example, the company highlighted that the “route to ‘yes’” was being fast-tracked by broker groups and lenders leveraging NextGen.Net’s ApplyOnline Assessment Metrics service, by reducing rework.
The rules engine service, which launched five years ago and now covers more than 50 lenders, pulls through lender updates and changes in real time, therefore ensuring that loan data is validated in real time and that applications are correct and complete.
Brokers can access the service via an API from their CRM at point of sale or once lodging the loan within ApplyOnline.
The system reportedly reduces reworks, improving the quality of applications and therefore cutting turnaround times.
However, the tech company noted that many players in the industry still rely on Excel calculators, which can result in an “inefficient lag in distribution of updates, and version control issues”.
“Probably the best way to describe the function of the Assessments Metrics tool is a lightning fast and accurate method of calculating a host of metrics linked to two of the ‘three C’s of credit’ – the evaluation of collateral and the capacity position of the application,” NextGen.Net applications director Brett Stanford commented.
“Our metrics service is not only used to calculate servicing and other metrics in present time but also in future states. For instance, a lender can articulate policy that applies to scenarios such as retirement plans or interest-only loans that may revert to principal and interest repayment,” he said.
Speaking to The Adviser, the chief customer officer at NextGen.Net, Tony Carn, added that lenders who had embraced the technology typically had fewer double handling issues, thus resulting in faster approvals.
He said: “When a lender uses the engine effectively, it gives the broker an accurate and thorough understanding of servicing alignment of the loan and whether it fits within approval thresholds. This gives the lender, the broker and the borrower surety around their approval and reduces the back-and-forth that can occur regarding servicing questions.
“We are all about getting application quality right from the point of sale, and recent turnaround time issues have highlighted the need for lenders to leverage the full capability of the technology tools available to streamline the approval process,” he said.
“Empowering the broker with up-to-date, accurate calculations that mirror what the lender uses in their credit approval process goes a long way to improving service levels,” Mr Carn added.
“We find our leading lenders who do utilise the full capabilities of the Assessment Metrics engine experience reduced double handing, coupled with an improved ‘time to yes’.”
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