"I don't actually know what normal' means in this industry, Carmel said, noting that the mortgage market has moved from a 40-year era of declining interest rates into a new phase of volatility and structural change. We're not just seeing cyclical ups and downs. We're seeing fundamental shifts in how mortgages are fulfilled and consumed. Carmel pointed to new-age technologies like artificial intelligence and blockchain as catalysts for long-overdue transformation, remarking that the mortgage industry lags behind other regulated sectors in terms of innovation."
"Speaking from a consultant's perspective, Lykken compared the mortgage industry to Nokia's fall from dominance when Apple's iPhone debuted, warning that legacy lenders could face a similar fate if they fail to evolve. Lykken quoted former Nokia CEO Stephen Elop and said, We didn't do anything wrong, but somehow, we lost. People in this industry think they're doing everything right, Lykken continued. But something new could come along."
"Instead, they argued, technology should allow for a more flexible, scalable workforce. I think with the right tooling and the right technology, you should be able to scale up and have a flexible workforce, regardless of the environment, Carmel said. You don't need to hire on a linear basis; it should be more non-linear in terms of what your headcount can do relative to your loan volume."
The mortgage market has shifted from a 40-year era of declining interest rates into an era of volatility and structural change. Mortgages are undergoing fundamental shifts in how they are fulfilled and consumed, propelled by technologies such as artificial intelligence and blockchain. Current origination processes are inefficient and costly, with per-loan costs rising from roughly $2,500 to $13,000. Legacy lenders face obsolescence if they fail to modernize, facing disruption comparable to Nokia's decline after the smartphone revolution. Lenders must move away from linear hiring tied to rate cycles and adopt technology-enabled, flexible and scalable workforces. Rapid technological adoption and tooling are necessary to reduce costs and win market share.
Read at www.housingwire.com
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