So, while one of our recent “Deeper Thoughts” celebrated just how far the mortgage industry has come in terms of embracing new technology and the priority of streamlining operations, this week, I’m going to bring us back to earth just a little bit. But don’t worry—I always try to see the bright side of things!
I ran across a good article by Ryan Smith in MPA recently. You should have a look. The premise is that there is an entire segment of our industry that may soon be tested by its own surge. Like most of the other less-exciting, non-sales functions, servicing and remediation tend to be lumped together under the umbrella term “back end” of operations. They’re almost a necessary evil, and it’s painful for many to spend a dime more than necessary on building them up. As a result, many “back end” units or divisions or vendors work on tight budgets. There’s not a lot of enthusiasm in most board rooms when a pitch for “back end” investment (technology or otherwise) is made.
But with more homeowners in forbearance than there have been in years, 3.6 million according to the article, we’re going to be seeing a spike in remediation efforts at some point in the not-too-distant-future. And it’s questionable whether many businesses will be ready for this new surge.
We had a preview of this in the Spring of 2020, when COVID bloomed and many servicers were absolutely under water simply trying to handle basic communications with borrowers.
What makes us think a surge in remediations will be any different?
The bad news is that our industry still tends to resist investment (of time or other resources) in elements of the process that don’t directly drive sales. It’s understandable, but also a little short sighted at times. The good news is that, when we’re really up against it, we adapt and shine. We sometimes need a little nudge from the Universe (or a giant shove, in some cases) to get there.
But we will.
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