Automated Mortgage Commissions System and its benefits

By inflooens on January 19, 2021

automated mortgage commissions system and its benefits

There is good news expected for Mortgage Loan Officers this year. Mortgage industry trends for 2021 predict demand for houses will be high. According to the Redfin report, home prices are rising, up 13% year-over-year, and pending home sales are up to 38% year over year. The report states that recent migration to affordable places and economic policies are affecting the housing market.

analysis of home sales expected in 2021

Figure 1: Analysis of home sales expected in 2021 Image https://www.redfin.com/news/housing-market-prices-up-13/

There was a big boost for the Mortgage Commissions system last year because of the low mortgage rates. This year will be a busy year for Mortgage Loan officers as they will be shifting their focus from refinancing to the purchase market in 2021. This blog discusses the Mortgage Commissions system and the benefits of automating it.

Role of Mortgage Loan Officers in the Mortgage Industry

Clients should consult a reliable Mortgage loan Officer when purchasing a home. A Loan Officer checks the creditworthiness and other parameters. A Mortgage loan officer gets Commission whenever the Loan Officer matches a consumer with a lender with the start of mortgage origination. In such instances, mortgage lenders must attract and, or retain talented individuals as Mortgage Loan Officers.

mortgage loan officer duties and responsibilities

Figure 2: Mortgage Loan Officer Duties and responsibilities Image https://www.thebalancecareers.com/loan-officer-526035\

The past year has changed the lives of some mortgage Loan Officers. They have built their clientele online due to the COVID-19 restrictions. They have started using social media automation platforms in marketing their services to their clients. Also, Mortgage CRM is used to automate communication with consumers and borrowers, helping Mortgage Loan Officers. There is also the use of custom-specified video messages and other social media platforms to reach out to the clients. The Mortgage Commission for Mortgage Loan Officers depends on components such as the origination fee, referral fees, preferred lenders, different loan programs, etc.

components involved in compensation for loan officers

Figure 3: Components involved in Compensation for loan officers Image Source https://iconixx.com/sites/default/files/resources/e-book/How%20Sales%20Commission%20Software%20Helps%20Automate%20Mortgage%20Broker%20Compensation.pdf

Mortgage Loan Officers are saving valuable time in the loan process by using the Mortgage Pricing system. The speed and efficiency in managing Mortgage pricing are crucial for mortgage originators. Automated mortgage pricing uses a product and pricing engine (PPE).

How is the Automated Mortgage Pricing System influencing the Loan process?

The factors affecting mortgage prices are mortgage data like prepayment speeds, global economic conditions, regulations, and monetary policies. The challenges faced by mortgage Lenders in Product and Pricing management include long lead times, expensive maintenance, and lack of trained resources. The loan scenario is changing wherein an integrated product and pricing engine incorporates Loan Officer compensation into loan pricing. The automated Mortgage pricing system forms a critical part of the loan origination process. It systematically monitors the mortgage rates and price fluctuations throughout the day. Product guidelines, pricing parameters, and underwriting guidelines are a part of the automated mortgage pricing system. The mortgage pricing system helps lowering expenditure, close loans faster with quick turn-around time, and stay compliant with the regulations. Inflooens’ Mortgage Pricing System provides accurate real-time pricing and quotes with reduced turn-around time.

Automated Mortgage Commissions system and its benefits

We have discussed how mortgage automation is disrupting the mortgage industry in our previous blog. Similarly, automation is changing the way of dispensing Mortgage commissions. Mortgage Loan Officers are evaluating lenders based on the compensation or commission plan offered to them. A mortgage lender has to consider many criteria while designing a commission plan for mortgage loan officers. Some of these criteria include:

  • Lien type (second, third or subsequent mortgage)
  • Source of referrals
  • Origination mortgage channels
  • Quality of loan files submitted
  • Loan purpose, whether a purchase, refinance, etc.
  • Type of Loans

Giving a real-time, accurate accounting of the Loan Officer’s Commission is challenging for most mortgage lenders in calculating Commissions. Mortgage lenders have to abide by the rules of the Fair Lending Act. The Act prohibits discrimination in any credit transaction. The use of complicated spreadsheets to calculate loan compensation is the main complaint faced by lenders in estimating Mortgage Commissions. The use of the Automated Mortgage Commissions System is to track the compensation of Loan officers. It helps in the mortgage system being compliant with the Federal regulations. Lenders are streamlining their back-office operations by automating the Mortgage Commission System. There are many benefits of using an Automated Mortgage Commission System. Some of these benefits include

  • reducing the workload on the staff of the Payroll department that used manual processes
  • cost-cutting audit fees involved in calculating commissions
  • compliance with Dodd-Frank’s Act

Automated Mortgage Commission System is speeding up the calculation of commissions, cost-effectively and accurately. Mortgage commissions and bonuses are calculated automatically by integrating Mortgage LOS in real-time as soon as the mortgage loan is closed. inflooens’ configurable Mortgage Commissions System is helping mortgage lenders in automating tedious loan commission calculations.

Summary

Automated Mortgage Commission System is bringing efficiency in the operations of mortgage lenders. It is providing a customized compensation plan for each Mortgage Loan Officer. It also provides clarity to each Loan officer regarding their commissions without any ambiguity. An automated Mortgage Commission System is vital for Mortgage lenders in growing their business with efficiency, reliability, and trust.


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