Paper is the residue of success in the mortgage business, to paraphrase Branch Rickey, the former president of the Brooklyn Dodgers. [caption id="attachment_5417" align="alignleft" width="266" caption="Paperless"][/caption] Succeeding in the mortgage business, especially on the origination side, means that piles of paper will be collected, sifted through, reviewed, checked, and rechecked. Every borrower knows that to receive a mortgage, he must gather his tax forms, his bank and investment statements, fill out several forms and hand them over to a loan officer or a mortgage broker to begin the origination process. For many lenders, vendors, and servicers, their offices are littered with boxes, filled with manila folders that will eventually be picked up and stored. It's an archaic process, one that wastes time because handling paper is inherently slow, expensive, and documents can be misplaced or lost. I’d like to believe that only a small number think this is the way to run a business, and most stick with paper processes because they think, erroneously, that it’s more flexible. To be sure, paper has been the mother's milk of the mortgage business, accepted as a fact of life, virtually since its inception. But increasingly, I've come to realize, the industry can live without it, can thrive without it. Deploying automation and paperless processes are faster, less expensive than manual, error-prone paper processes, and they are a key to generating profits and staying a step ahead of the competition. As a result of technology, lenders close more loans with fewer people, suffer fewer mistakes, and spend fewer dollars to do it. Consider the following:
- $122: The cost of paper from point-of-sale to closed loan.
- 870: Number of sheets of paper that the average loan requires.
- $38.92: The average per loan cost of the paper alone.
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Matt Strickberger is media counsel and the chief Internet officer for RGA PR. He was the editor of Mortgage technology magazine and the editor of several Wall Street-related publications. To ask a question or to forward a comment, email him at [email protected].