IBM (NYSE:IBM) today announced the expansion of its end-to-end loan fulfillment services to include new components and technology that will help lenders make better use of outsourcing services such as loan origination and loan fulfillment.
A recent IBM-conducted survey that sampled senior mortgage executives at a range of lending businesses found that 36% of lenders plan to increase use of outsourcing services for mortgage origination over the next 18 months. According to the survey these senior lending executives believe a large proportion of mortgage origination tasks have the potential to be outsourced.
IBM's new and expanded services for lenders will be initially available in the U.S. and include:
New Outsourced Federal Housing Administration (FHA) Loan Fulfillment Capabilities:
Lenders today are struggling to adapt to the rapid increase in FHA loan volume and the complexities of FHA processing. Now, IBM's private label end-to-end mortgage loan fulfillment offering has been enhanced with the addition of outsourced FHA fulfillment services. IBM, through its wholly-owned subsidiary, IBM Lender Business Process Services, Inc. (IBM LBPS), will offer a turnkey approach to ramping up FHA volume with minimal disruption to operations.
New Component Business Process Services:
IBM now offers borrower and collateral verification services that can mitigate fraud risk and improve loan quality as well as vendor management services that can strengthen integration through the mortgage supply chain, improving cycle times and accuracy. Other component business process services include pre and post closing quality assurance to reduce defects and improve adherence to investor guidelines. In addition, document capture and data extraction can facilitate process automation and reduce costs.
New Levels of Flexibility in Lending Technology:
IBM now offers lenders increased flexibility to leverage its lending technology platform in whole or in individual components through a technologically advanced loan origination platform that employs SOA principles and web services. IBM's enhanced technology offerings include improved configurability and functionality in IBM's core Loan Origination System (LOS) and an Electronic Loan File solution that leverages IBM's FileNet platform. As well, IBM provides web portals that improve customer/broker experience at client web sites and browser-based point-of-sale solutions that help sales teams close business. Web-based mortgage training can improve knowledge of products, compliance and lending fundamentals.
"IBM's enhanced and expanded portfolio gives our lender clients a diverse set of solutions to address their specific business needs in this turbulent market," said Eric Ray, general manager for Financial Services Solutions, IBM Managed Business Process Services. "IBM focuses on providing our lender clients with business solutions that will improve their agility, flexibility and competitiveness to manage their business more effectively through dynamic market cycles."
IBM is working with lenders to restructure their business models in order to capture market share and strengthen competitiveness. IBM's lender clients can derive benefits and advantages in the marketplace through improved mortgage loan quality, risk management and compliance via automation. Other benefits include improved borrower experience by increasing consumer visibility and control and improved speed to market and faster cycle times for new products, channels, geographies. Clients can access leading edge lending technology and services without steep upfront capital investments and recognize 20% to 40% lower cost by shifting to a more variable cost structure.