Why innovation matters now

In today’s market conditions, lenders who identify strategic opportunities and innovate their operations now stand to gain a competitive advantage. Historically successful lenders have accomplished this by focusing on customer experience, operational efficiencies and the agility to pivot when markets shift. But innovation doesn’t have to mean reinventing the wheel; it can mean leveraging existing strengths to create new opportunities.

Consider how Stripe and Square advanced digital payments by leveraging Visa and Mastercard’s existing infrastructure to make electronic payments accessible to smaller merchants. Square developed a smartphone-based payment card reader now widely used by food trucks and pop-up shops, while Stripe released an API that let online businesses take payments with a few lines of code. For these brands, innovation didn’t come from replacing existing infrastructure; it came from building upon it. This same principle can apply to mortgage lenders driving innovation across their lending operations.

Start with a stable foundation

In 2008, Hurricane Ike caused widespread damage, flattening nearly every coastal structure in Gilchrist, Texas. One yellow house remained intact. Its owner had previously lost his home to Hurricane Rita in 2005, so when he rebuilt it, he used reinforced concrete and deep pilings that exceeded building codes. With a solid foundation, his house weathered the storm, while others around him were washed away.

For lenders, proven technology platforms are that steady foundation, keeping them safe and grounded when the market experiences turbulence. For that reason, it’s critical for lenders to consider the strength of their LOS when embarking on their innovation journey. For example, does it integrate the entire lending process into a single system of record where critical data flows seamlessly from one process to the next? Can it connect the entire homeownership experience into a single platform to provide a frictionless experience for their customers from start to finish? Equally important is access to a vast network of integrated partners that can extend and enhance your capabilities without compromising your technology foundation. It’s essential for lenders to consider these questions before embarking on their innovation journey.

The alternative can be risky. Attempting to integrate multiple point solutions from multiple vendors can create a fragile technology stack where integrations break, data flow is disrupted and you’re left managing vendor relationships instead of serving borrowers. Worse, partnering with undercapitalized startups in a volatile market means your technology foundation could disappear when market conditions shift.

Drive operational efficiency and scale with automation

Manual processes in mortgage lending drive up costs and extend cycle times. With origination costs approaching $12,000 per loan, mostly from manual work, automation is essential for remaining competitive.

Consider Amazon’s automation transformation. Early fulfillment centers relied entirely on manual labor, which required workers to walk miles daily retrieving items from shelves, and limited scale as order volume surged. In response, Amazon introduced robots to bring products directly to workers’ stations, followed by AI-driven inventory management, demand forecasting and routing optimization. The impact? Amazon transformed delivery speeds from days to hours while reducing costs and building flexibility to handle demand surges. Automation unlocked entirely new service levels customers now expect as standard.

Mortgage lenders have the same opportunity. Intelligent automation available through leading mortgage technology platforms eliminates repetitive tasks like verifications, document gathering and data extraction. Lenders who automate now achieve faster loan decisions, lower costs per loan and maximize capacity to handle volume shifts without adding headcount.

Meredith Williams, COO of GMFS Mortgage, has seen the benefits firsthand. “Encompass® provides automated enhanced conditions and automated service ordering that’s helped us cut back on manual workload for employees,” she explains, “so they’re able to provide a hands-on customer experience.” By shifting resources from tedious tasks to client interaction, lenders can build stronger relationships and a more resilient business.

Start small, iterate and expand

Driving innovation across your business doesn’t require an overnight overhaul. For example, consider when Microsoft initially introduced Office 365 to their customers over a decade ago. Rather than requiring their users to “lift and shift” to the new technology all at once, they encouraged users to gradually adopt cloud-based features while working in a familiar desktop environment.

ICE takes a similar approach. Lenders can access Encompass’s latest innovations through either the desktop or web interface, allowing them to leverage task-based workflows and automation while clients adopt changes gradually. This strategy delivers immediate impact to targeted workflow areas without requiring a complete overhaul, accelerating time to value while minimizing change management demands. Existing configurations, such as business rules, persona controls and field triggers, remain in place. This is about innovating incrementally on a solid foundation, not starting over.

Transform with confidence

Given the challenges lenders face today, innovation isn’t optional. Lenders who embrace innovation now will be positioned to thrive when market conditions shift, with the agility to respond quickly to new opportunities and challenges. The path forward is leveraging an established technology ecosystem with proven ROI that provides integrated, intelligent platforms and solutions that help you acquire and retain customers, validate loan quality and compliance, lower origination costs, shorten the homebuying cycle and build a resilient business that can thrive in any market.

By partnering with a proven technology provider and taking intentional, incremental steps, you can achieve the kind of innovation that transforms your business without the risk of starting from scratch.