The five factors driving mortgage technology

2019 saw the Australian mortgage industry riding out the storm and regulatory headwinds of the Royal Commission. As we enter the next decade, it’s important to consider where we are at, and what the mortgage lending landscape looks like in Australia for 2020 onwards.

Technology continues to disrupt, and the mortgage market is no different. Open banking, APIs, AI and machine learning are all hot topics in the industry right now. While the tech surge is likely to continue, human connection is more crucial than ever.

Here’s what we see as the five factors guiding the mortgage landscape and the future of mortgage technology.

1. Speed

Time poverty has never been so prevalent across the globe. Everybody, everywhere is overwhelmingly busy. Taking advantage of automation in processing mortgages will be an important part of reducing the current time, effort and cost for the customer. Technology will enable resources to focus on improving the speed and efficiency of assessments, while digital decision making can provide consistency and compliance certainty.

2. Relationships

Despite the continued rise of technology, human connection will also continue to be critical to success for mortgage lenders in 2020. Building mutual trust and respect with customers will come from lenders being strong, stable and prepared to invest in ongoing innovation customers can benefit from. Likewise, lenders need to continue to demonstrate a deep understanding of the market and the ability to leverage local and global expertise to build better relationships and customer experience.

3. Capability

Following the Royal Commission, meeting compliance and regulatory obligations alongside community expectations is more important than ever. Yet compliance has become extremely complicated and high risk. The best option to meet these complications is to find a provider who can take over the entire process of loan origination from end-to-end. APIs are also big news for the lending landscape. Open banking is coming, and mortgage processing technology will need to work with API-first service providers to enhance the customer experience.

4. Customer

Technology is an important part of many lenders’ aim to improve their customer experience. In the mobile, app-filled world that we live in, most people, and in particular the younger generations, will not accept archaic, inefficient and ineffective systems and processes. They want consistency and access to intuitive services on-demand. Creating a personalised and efficient home loan journey for customers is expected in 2020 - not just desired.

5. Technology

Those who embrace technology will be best placed to improve the customer experience. Those who fail to do so will risk being left behind. As we move into the new decade incorporating data-driven workflow and decisioning will be increasingly important, and by doing so will remove reliance on manual assessment or intervention. The ability for a mortgage lender to make continuous improvements and regularly upgrade its technology will be critical. This will only be possible by using highly automated software. Using cloud-hosted technology will further improve speed, reliability and cost effectiveness.

Iress recently released the 2019 Mortgage Efficiency Survey for the UK. Many findings are relevant to other markets, including Australia.

At Iress, our software helps lenders give their customers the best mortgage experience through an efficient, simplified, connected mortgage journey.