This article originally appeared in National Mortgage News
After spending a good portion of my career leading organizations creating industry-changing technologies such as Fannie Mae’s Day 1 Certainty® and Collateral Underwriter®, I came to my new operational role at Sagent earlier this year knowing any innovation with potential to change the housing landscape can only do so successfully within a tight framework of guiding principles.
At Sagent, we know that lender and servicer priorities are focused on providing a superior customer experience, lowering total operational costs, and maintaining compliance with complex rules and evolving regulations. We’ve been talking about these “3 Cs” all year, and delivering and innovating on them requires a top-down approach that prioritizes building end-to-end technology in an open ecosystem. Why?
- Delivering an end-to-end solution provides a comprehensive set of capabilities to handle the entire loan-servicing lifecycle from onboarding to disposition for performing and non-performing loans, and,
- Creating an open ecosystem offers extensibility and optionality our industry needs via open APIs and agnostic vendor integrations.
These five touchpoints are the future of servicing technology and Sagent’s guiding principles of innovation. Let’s break it down.
End-to-End Servicing Tech Is the Future
The idea of an end-to-end servicing solution predates my time as Sagent’s COO. In fact, I talked about the concept publicly on my first day in this role.
An end-to-end platform is Sagent’s “Grand Unified Theory” of servicing. Our delivery timelines aren’t as far out as the metaphor suggests, but it’s been a tough nut for our industry to crack. To date, solutions have been end-to-end in name only, often nominally achieved through a hodge-podge of contract line items or so many ancillary systems that servicers literally lose count.
So, this is where Sagent sees a huge opportunity for bold innovation at the foundation of servicing technology and processes — it’s the future of servicing that we’re building from scratch because the benefits will radically shift the way mortgage servicing operates.
When we succeed, servicers will have a single technology component that unifies maintenance and configuration, offers comprehensive loan-level data (without granular access fees), and gives operators and homeowners real-time views of payments, escrow, equity, and hardship options. And by nature, such a solution offers global configurability for a complex set of changing rules and policies from investors and regulators.
And this just scratches the surface of the innate potential of an end-to-end servicing solution, but you’ll see that all roads lead inevitably back to our 3 Cs, and that’s why this is a foundational principle.
Open Ecosystem, Open Opportunity
Sagent is the only major servicing software player building a cloud-based, open-API core, default, and consumer platform all synced by real-time data. Our solutions already lead the way, but why quit when we’re ahead?
The connectivity inherent in an open ecosystem is where all five principles come together to power a better customer experience while reducing total operational costs for servicers.
And it’s the only way forward. For example, as AI fast becomes our new normal, it’s naive to think that a powerful solution — such as an LLM (large language model) that can conversationally assist homeowners and operators to navigate complex processes like hardship relief — can be “bolted on” to monolithic legacy applications.
To truly leverage the power of AI, you need the extensibility of cloud-native applications that, by design and architecture, are ready to integrate with next-generation solutions.
In tandem, it also simplifies compliance and helps avoid enforcement risks and penalties, giving your team the power to tailor your technology to your needs and processes. But more on that in a second.
We’re the only scale servicing technology player that is innately open. And we know that represents a distinct departure from the ‘our way or the highway’ ethos of many technology companies.
That departure is why Sagent is the industry leader in cloud-native, open-API mortgage servicing technology.
This connectivity means optimized loan movement for easy onboarding and offboarding, and playing nicely with your preferred third-party integrations to power a better experience for your homeowners.
Transforming the Customer Experience
A better homeowner experience begins, ends, and emanates out of simplified, unified operations. This means applying all the do-it-on-your phone advances in other industries (think retail/Amazon) to the servicing space, and it’s what Sagent offers today with CARE, our mobile-first consumer platform.
This also means good tech that empowers homeowners to self-serve in real time and in almost any scenario, but also get real human help on-demand from someone who has visibility into exactly what they’re seeing.
With the industry average customer retention waning ~23%, these features matter more than ever for homeowner satisfaction and retention.
And it’s even more important in servicing because that is where customer relationships are nurtured, grown, and retained via new origination or attentive hardship resolution — evidenced by the 75+% retention rate of some Sagent customers.
Better Fintech Means Lower Servicing Tech Costs
Change often occurs at the point when not changing is more unpleasant — or more costly — than staying put. That’s why Sagent is driving dimensional cost control to lower not just servicing operations costs but IT costs as well.
Think of it this way: If you’re currently servicing 100k loans, what would it mean to your business if you could go grow to 150k without adding another FTE?
We believe that’s realistic, and here’s how we’re optimizing loans per employee (LPE):
- Servicers streamline ops by reducing ancillary systems and eliminating check-the-checker processes.
- They can configure, rather than code for real-time investor and regulator changes with turn times of days, not months.
- They can easily build their own processes for custom use cases across core, default, and consumer servicing.
- Intuitive UI/UX means ramping new employees to productive workers is a matter of weeks, not months, and cross-training existing employees is made far more cost effective.
All of this lowers IT and especially operational costs, and the latter is where servicers beat competitors on service and profitability.
Real-Time Innovation for Real-Time Compliance and Policymaking
We’re in the trenches every day with some of the biggest servicers in the US collaborating to reimagine old processes, iterate, and augment to the betterment of their operations and bottom line — all while staying on top of every compliance detail.
Real-time data across core, default, and consumer servicing platforms is essential for real-time compliance with real-time policymaking.
Compliance details are innately built into user actions, and open API, cloud-based platforms mean consistency and visibility from every vantage point, — consumer and servicing employees on either side on any Sagent platform see only the latest customer, investor, and compliance information.
We know consumer experience, cost control, and compliance are top priority for lenders — and true technology innovation that accomplishes all three is difficult to do without an open ecosystem that’s designed for configurability and structured flexibility.
An end-to-end platform is the final piece of this puzzle, and that’s where Sagent is leading innovation in the servicing industry.
Let’s continue this conversation, and please reach out with your questions.
This article originally appeared in National Mortgage News