Point-of-sale systems have been gaining in popularity in the mortgage industry ever since Quicken Loan’s Rocket Mortgage launched its “Push Button, Get Mortgage”
campaign during the Super Bowl in 2016.
Today, it seems nearly every mortgage technology
provider offers a point-of-sale system. With so many
on the market, what does an originator need to know
to determine which system would be the best one for
The first thing originators need to understand is
how to define what a point-of-sale system is in the
mortgage industry. Most people think of them as they
are typically defined in retail — the time and place a
transaction is completed. The mortgage point of sale,
however, is slightly different.
What it can do
A mortgage point-of-sale system interacts with homebuyers so they can begin conducting business with an
originator digitally. It starts with intuitive loan applications, prompting potential borrowers with questions
that apply to their unique situation and loan inquiry.
This improves the borrower experience, as well as
A point-of-sale system also may include the ability
for borrowers to verify assets, exchange and sign documents electronically, and track loan progress. In addition, the mortgage systems also should seamlessly
connect to pricing and decision engines, as well as to
automated underwriting systems — speeding up and
providing consistent, unbiased pre-qualification.
The technology is a critical element of the digital
mortgage process and benefits originators in many
ways. It enhances the borrower experience, especially
for those borrowers who prefer to shop online.
The technology allows originators to understand
borrower needs, communication preferences, and
how far along the borrower is in the mortgage process.
Thus, it allows an originator to tailor their approach
and services for that specific borrower’s needs.
In addition, a good point-of-sale system improves
process efficiency by reducing paper, turn times and
expenses — making the technology a necessity for
success in the mortgage industry today.
The need for it
One of the reasons point-of-sale systems have become
a necessity in the mortgage industry is millennials.
This generation — the largest generation in U.S. history
— has been the most active in homebuying for the
past five years.
Millennials accounted for 36 percent of home purchases in 2017, surpassing baby boomers ( 32 percent)
and Gen Xers ( 26 percent), according to the National
Association of Realtors.
Unlike previous generations, millennials are not
just tech-savvy. They are tech-dependent. Millennials spend, on average, nearly four hours a day online,
and 68 percent consider their smartphones to be their
most important device, according to a recent report
from Global WebIndex.
In addition, millennials find brick-and-mortar institutions inconvenient. In a recent study from Computer
Services Inc. and The Center for Generational Kinetics,
35 percent of millennials revealed that they do not
visit banks due to limited branch hours. Additionally,
54 percent of millennials believe they can perform
any necessary bank functions online. By having point-of-sale technology in place, originators may engage
with millennials at the moment they are ready to buy
a home — regardless of the time or the place.
What to consider
It’s important for originators to consider all options
and potential pitfalls when shopping for a point-of-sale system. Shopping for any technology does
require a significant investment in resources. But what
should an originator consider?
The first question is whether it’s easy to use for both
the originator and their borrowers. It should prompt
borrowers with questions that apply through the
system based on previous answers and skip questions
that are not applicable. This will lead to better, faster
service and higher application-completion rates.
The next thing to consider is whether the technology can be seamlessly integrated with your existing
loan-origination system. The ability for borrower data
to easily transfer between the two systems increases
the efficiency of the mortgage process and decreases
the risk of errors that comes with double data entry.
Originators also should think about whether the
point-of-sale system ties them to a single lender. That
can limit the products an originator can offer a borrower, particularly loan products that do not fit in the traditional qualified mortgage (QM) box. For originators
looking to reach more underserved borrowers — such
as individuals with past defaults, sole proprietors, or
individuals with assets who are seeking interest-only
or asset-depletion options — having access to more
than one lender is a necessity.
Security is another concern. With more and more
borrowers preferring to communicate online, it’s essential to have functionality that allows originators to
securely request required documents for verification
or e-signatures. In addition, borrowers must be able to
securely submit those required documents, whether
they scan them into their computer or capture the images via a mobile-device camera.
Mortgage originators also should know whether
the point-of-sale technology includes a Spanish-language option. Hispanics are the only demographic
in the United States to have increased their rate
of homeownership in the past few years — from
45. 6 percent in 2015 to 46.2 percent in 2017, according
to the 2017 State of Hispanic Homeownership Report,
a publication from the National Association of Hispanic Real Estate Professionals and the Hispanic Wealth
Project. Offering a Spanish-language option will allow
originators to broaden their reach within this growing
Another item to consider is whether the point-of-sale
technology allows originators to showcase their
brand with their logo and a personalized URL address.
This is called white-labeling and it boosts the originator’s
visibility and makes a great first impression with
Originators need to know upfront the cost for the
point-of-sale technology, and they should ask if there are
set-up fees, monthly payments or pay-only-for-actual-use
fees. This one may seem obvious, but it’s important for
originators to confirm there are no hidden fees. n
Bob Dougherty is executive vice president of business
development at Calyx Software, a leading provider of
comprehensive mortgage-origination software solutions
for banks, credit unions, mortgage bankers, wholesale and
correspondent lenders and brokers. He has more than 25
years of operations and business-development experience
in the mortgage industry and was previously vice president
of mortgage operations for a community bank in Minnesota
and chief executive officer at Timberland Mortgage Services.
Reach Dougherty at firstname.lastname@example.org.
Is No Longer Just for Retailers
These systems can benefit originators too, but consider this before taking the plunge
By Bob Dougherty
Items to consider with
n Ease of use for originators, borrowers
n Ability to integrate with a loan-operating system
n Capability of working with multiple lenders
n Security in transmitting data
n Availability of a Spanish-language option
n Customization options
n Cost, including future fees