Today s Document Management System Go Paperless; Go to the Cloud; Go Mobile; Foster Collaboration
Paper-based processes are costly and inefficient. To be successful in today s challenging mortgage environment, mortgage companies need to implement new systems and methods to reduce time and cost in operations. Lower volumes and tighter margins have lenders striving to reduce their costs and become more competitive. Better customer service is also essential to success, so speeding up the origination process will also help mortgage lenders thrive. Replace paper processes with document imaging Mortgage companies are not yet taking full advantage of the technology options now available. Many are struggling to find a solution to relieve key business pains associated with the huge amount of paper involved in the lending processes. Electronic document management solutions will help mortgage companies solve these problems. Today, there are document sharing, imaging, and collaboration solutions for mortgage lenders that offer essential support for fast, low-cost document processing. Mortgage companies can continue to rely on their traditional, manual, paper-based operations, or they can invest now in technology to capture and manage documents electronically. According to an Aberdeen Group report, all 119 companies surveyed that had invested in electronic document management reported superior performance in almost every area, especially in metrics concerning time, data visibility and cost. 1 Companies that have invested in document management reported superior performance in time, data visibility and cost. Lower costs and reduce errors Utilizing electronic document management solutions lowers the cost of document-based processes and reduces error rates. Document imaging reduces overall paper costs, which consist of producing forms, copying, filing and mailing. It also reduces facilities costs by eliminating the need for onsite file storage. It can cost a company up to $25,000 simply to fill a four-drawer file and $2,100 per year to maintain it. File rooms that occupy valuable and expensive square footage can be eliminated. Organizations that rely on manual processes often see more errors since human error is inevitable. The accumulation of little errors can often have a great financial impact on an organization. According to an Aberdeen Group report, organizations with document management systems reported 30% fewer errors in documents processed with a document management system. This contributed to their 10% reduction in overall operational expense for document processing in the past year. Replacing paper-based mortgage processes with electronic imaging systems offers tremendous benefits to mortgage organizations. Electronic imaging systems streamline processes, thereby reducing labor costs. They also facilitate the secure submission of loan files from branch offices to centralized operations centers or from third party originators (TPOs) to lenders. All participants in a loan transaction can collaborate on loan documents simultaneously. Mortgage lenders are able to reduce manual labor by 75-90% with electronic imaging systems. They can conservatively reduce 1-2 person-hours per loan 2
folder because lenders eliminate inefficient, error prone, and labor intensive manual or semi-automated processes such as sorting, naming and organizing loan documents. Automatically recognize, convert and file loan documents with enhanced document capture Aberdeen Group surveyed 36 organizations in document-heavy industries and found that the cost of scanning or capturing a single document for the average company costs approximately 19 cents and takes 4 minutes. A document capture solution enables organizations to convert received document files into digital images more reliably than other solutions by having documents automatically recognized and converted. Today s technology enables documents to be received in various ways, including fax, scan, email, upload, or FTP, and be automatically converted into digital images. If a company handles 1.5 million documents a year, an image processing system has the potential savings of $285,000 per year just in the image capture step. Time Savings Reduce manual labor by 75-90% Reduce 1-2 person hours per loan folder because lenders eliminate inefficient, error prone, and labor intensive manual or semiautomated processes. An average of 25% of misplaced documents arnever found and companies invest significantly to recreate or locate missing documents. With today s document recognition technology, systems are able to automatically recognize hundreds of commonly used mortgage industry document types. Recognized documents are then automatically named, indexed, and organized into their proper loan folders. This also enables document images in a loan folder to be searched for, filtered, selected, and arranged in a stacking order, according to loan type and investor or other requirements. These capabilities decrease holding times and reduce file intake errors. Stop wasting time; improve productivity Document imaging solutions improve the productivity of document processing tasks in several ways. According to Aberdeen Group, document management solutions decrease employees time spent looking for information by 2 hours a week. Document imaging provides protection and control over legal, original and unique documents. According to industry sources, an average of 25% of misplaced documents are never found, and companies invest significantly to recreate or locate missing documents. Electronic documents are protected from natural or unnatural disasters, which further increase processing times, decreasing service levels and customer confidence. Employees often spend significant amounts of time looking for the correct information required to perform his or her job. This can be eliminated with the use of electronic files. Employee productivity can be improved by eliminating the need to switch between tasks and wait for files to be retrieved in order to restart projects. Employees can work through issues in real-time, and customers questions can be answered in an efficient and timely manner. Personnel are not limited by the information captured in loan origination systems. 3
Data not captured there can be viewed from the electronic images, improving the workflow of each loan application. Document management solutions also improve the audit and discovery processes. The solutions retain the documents in a secure and organized form to provide for easy retrieval. All loan documents can be accessed without searching for, retrieving and handling paper loan files. Due diligence examinations can be done without sending auditors on the road, increasing productivity and dramatically reducing acquisition costs on loan pools. Packaging and delivering electronic documents for any investor, insurer, servicer, or other third-party is simple and immediate. Document images in a loan folder can be searched for, packaged and sent to recipients via multiple methods. Documents can also be retained for long-term archival. Today s imaging platform: in the cloud, mobile, and collaborative Today s imaging platforms are vastly different from first generation systems introduced a few years ago. Mortgage companies have more and better options as to the types of document management solutions to use. Cloud-based solutions offer increased flexibility Cloud-based document management systems are becoming increasingly popular. In addition to giving users the ability to view documents online anywhere and at any time, cloud-based document management systems offer added benefits, such as reduced up-front capital cost. Unlike traditional document management systems, which are dependent on office-based servers and support from IT departments, cloud systems require no IT infrastructure, making them a more cost-effective option. There is no need for organizations to invest in additional computers, servers or software licenses. Cloudbased systems use a monthly subscription model based on usage, making it an operational expense as opposed to a capital expense. Because of this, the long approval processes often needed for capital expenses are eliminated. Cloud-based solutions also require less implementation time typically one month compared to several. The cloud model is able to support any kind of organization and distribution of labor, because the solution can be accessed anywhere, and user roles can be quickly configured. Security is less a concern with cloud-based solutions. Clients and partners collaborate through the cloud in a secure way. Borrower information is protected while documents are accessed. Data centers have restricted personal access, and annual testing is done to meet customer security requirements. In addition, with electronic solutions, the risk of documents being lost internally or through the mail or fax is eliminated, saving companies significant amounts of time and money. While robust security rules secure data, cloud-based solutions also enable flexibility so that the necessary parties (loan officers, processors, underwriters, assistants, funders, etc.) can work on a file regardless of the stage of the application. In addition, workflow across organizational and geographical boundaries, despite differing in-house technology 4
systems, is possible, enabling various partners to collaborate despite location. The greater transparency that cloud-based document imaging facilitates allows for better communication and process automation across all sectors in the mortgage industry. Data Visibility Able to automatically recognize more than 250 commonly used mortgage industry document types. A conventional mortgage banking operation spends a great deal of time and effort passing data and documents around. Production chains deploy a linear team workflow process, which is typically short on collaboration and fraught with operational inefficiencies creating backlogs during peaks and staff under-utilization during lulls. With a cloud-based imaging solution new employees have the ability to work remotely. In addition, getting them up and going is as easy as configuring their credentials on the network, usually taking less than an hour. This eliminates the restraints of physical locality, and with a secure off-site virtualized server infrastructure, adding or removing staff becomes effortless and cost-efficient. With a highly customizable and scalable cloud-based system, the service provider is responsible for meeting all guidelines, industry regulations and compliance requirements. This alleviates the compliance burden from organizations that would normally have the responsibility of building and maintaining the technology internally. The service provider also provides a guaranteed auditable paper trail, helping the mortgage industry as government regulations and oversight continue to grow. In addition, the auditing of detailed transaction history that is not possible with paper or images, is also available. In today s mortgage environment, the on-demand retrieval of transactions is critical to support statutory retention of records, state and federal audits, foreclosures or litigation. Mobile access helps today s on-the-go LO and executive In today s mobile work environment, many mortgage professionals are looking to utilize document imaging solutions via their smart phone or tablet. A mobile app does not replace the full-featured application, but acts as an extension of it for mobile purposes. The target audience for document imaging mobile apps are loan officers, regional account executives, production managers, and other users who are on the go. These apps can improve information access, accountability, turn-around time, and loan throughput. There are many benefits for users, such as having the ability to get up-to-date information about the status of loan documents, anywhere, any time. Mobile applications provide better customer service by providing timely information and support to customers. This ultimately improves service response times and enhances productivity. s offer better collaboration Today s cloud-based document sharing, imaging and collaboration solutions streamline collaboration between mortgage companies and service providers involved in a loan transaction by enabling the efficient and secure sharing of documents and related information. 5
An imaging system used in conjunction with a loan origination system (LOS) yields superior process improvements. The imaging system is used in parallel and in conjunction with the LOS since there are really two different sets of tasks that need to be completed. Most LOS systems work more with the loan data than with the images or documents, making it a necessity for most mortgage professionals to have both an LOS and an imaging solution in order to have a complete electronic document management solution. Cost Savings Reducing onsite file storage can save a company s facilities costs up to $25,000 simply to fill a fourdrawer file and $2,100 per year to maintain it. 30% fewer errors in documents processed Results in a 10% reduction in overall operational expense for document processing in the past year. The cost of scanning or capturing a single document for the average company costs approximately 19 cents and takes 4 minutes. If a company handles 1.5 million documents a year, an image processing system has the potential savings of $285,000 per year. In efforts to turn the physical, sequential process into a collaborative, parallel process, today s document management solutions eliminate the chaos and mystery behind the loan process. They facilitate improved collaboration between all participants affected by a loan, including lenders, aggregators, investors, brokers, title insurance agents, closing attorneys, real estate professionals, servicers, prospective homeowners, etc., by ensuring the necessary paperwork is received by each party, in the format each requires. As more stakeholders are involved in the paper-based document handling, chances for mistakes, miscommunication or missing documents increase significantly. Utilizing electronic document management solutions eliminates these issues, as well as offers the ability for real-time multi-participant collaboration for internal and external parties. In addition, organizational collaboration with appraisers, providers of VOEs, VOIs, and credit reports can be facilitated. Rating agencies and bond insurers can be allowed access to files, improving analysis quality and reducing turnaround time. Underwriters, processors and account executives can share information, accelerating decisions or closing times, especially since the network platform is always available. Workflow features imbedded in the solution, including notifications and alerts, enable true collaboration between parties by sending notifications to participants when documents arrive, change or need attention. The electronic folder includes the documents and their contextual history, including when documents arrived, who processed them and relevant notes and conversations surrounding the documents, providing increased transparency to the entire loan package. 6
According to Aberdeen Group, organizations with electronic document management systems can leverage a greater percentage of their business data and reported the largest gains in data visibility. An example of this capability can be seen inside a bank. With electronic systems, branches and bankers can clearly see the status of applications in the pipeline and answer questions such as: who is working on the deal, how long have they had it, are there any open questions or issues, what can be done to help speed up the process? Save resources and time with a cloud-based imaging solution Ultimately, the greater insight and transparency cloud-based document imaging solutions offer into loan documents produces faster approval processes, increased customer satisfaction and increased revenue for financial institutions. Implementing such a solution is imperative for mortgage companies that are struggling to find a solution to relieve the key business pains associated with an influx of paper and inefficient workflow processes. About Capsilon Since 2004, Capsilon has provided comprehensive document management that enables lenders and investors to increase productivity and lower loan costs while ensuring full compliance. The company s product, DocVelocity, is a cloud-based imaging solution enabling document capture, collaboration, loan delivery and retention. The winner of numerous mortgage technology awards, Capsilon currently serves medium to large mortgage companies. Learn more at www.capsilon.com. 7