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BROKERS START CLICKING AS ONLINE HOME LOANS ARE PROCESSED UP TO TWO DAYS FASTER

4 December 2006

Online home loan applications are being processed by lenders up to two days faster than paper-based ones for mortgage brokers using e-commerce standards under the Lending Industry XML initiative (LIXI).

Ten years ago an online business model was a pie in the sky idea but thanks to not-for-profit group LIXI e-commerce standards make home loan information standard and transferable electronically via the use of CAL (Credit Application Language).

Being able to secure loans two days earlier is certainly appealing to Leeanne Scott who runs the North Sydney Mortgage Choice franchise. She represents almost one in five Mortgage Choice brokers who processes all loan applications online using the industry’s e-commerce standards. She prefers not to deal with any lenders on paper. They simply get over looked. Instead, she deals with the 15 lenders who prioritise her applications because the forms go straight into their system and eliminate re-typing.

At the hub of this activity is Socrates Vasiliadis, CEO of LIXI. He says that brokers like Leeanne Scott view the lending process as a collaborative effort.

“Online brokering is not a way of the future – it’s a way of the now. The technology and industry collaboration is there for everyone who wants to embrace it,” he says.
According to Ms Scott, LIXI has delivered innovative results. “We’ve been able to almost eliminate office paper,” she said. A small paper-based file for each client is all we use while the application is live. It is then scanned and remains online.
“Since LIXI’s conception, we are reaping real business benefits which are transferred to our clients including faster home loans and richer client profiling. Future information required from clients for refinancing or repeat business is minimised because profiles only require updating, not re-entering into the system,” she said.

In October 2006, 22 per cent Mortgage Choice brokers were 100 per cent online and a large number of additional are online for three quarters of applications. More brokers are leaving paper behind and re-training staff to use LIXI-based platform.
Some mortgage brokers have their own electronic system but according to Ms Scott, they will get left behind as more and more lenders and valuers adopt the LIXI platform.

“A lot of money is invested in office technology but switching to LIXI’s e-commerce standards involves simply installing software. The hardest transition is not the implementation but the mindset of moving away from the paper trail,” she said.

Ms Scott says that while online processing requires more initial data entry for brokers, she gets a better idea of the application and client needs. This means that she is able to select the home loan which provides the best fit for the client.