The future of loan officers: Thoughts from a former LO

Lending looked a lot different back when I was a loan officer. In the days of dial-up internet, I had to fax a piece of paper into the lock desk in order to lock in a loan. Needless to say, I’ve seen a lot of change in the last 25 years as I migrated from retail banking to investments, and then mortgage finance before I landed in mortgage technology in 2002.

But if there’s one thing that has remained constant over the years, it’s fear around new technology. In fact, I remember the president at my first mortgage job constantly warning us that future technology was going to replace people.

Two decades later and we are hearing the same conversations. At first glance, the future of loan officers seems destined for automation and robots replacing people. There are countless articles predicting this and increasing levels of unemployment.

My experience tells me this isn’t true. That’s not to say that automation won’t have an impact on the LO. Of course it will. But smarter automation will help LOs do their jobs better by making them more efficient.

And it’s past time for added efficiency. While the LO role has always been a very sales-focused, relationship-oriented role, it’s also been super manual. Imagine the depth of connection and business impact we can unlock with the right technology to support us.

It’s time to remove the paper burden

For too long, the LO has been heavily reliant on spreadsheets and paper-based processes. Take the loan application as an example. An LO shouldn’t have to sit down with their customer and manually type information into a system on their behalf. They shouldn’t have to wait while the customer collates a bunch of information, then spend more time chasing down bank statements or verifying assets and employment details.

Yet it happens all the time.

It’s the same if a customer is refinancing a house. Why should the LO have to wait on a title report? They should be able to access that information instantly, in a secure way.

And that’s why I joined Blend. I saw how they were using mortgage automation to reduce this burden of paperwork. I wanted an opportunity to be a part of something that I felt was really going to make a difference.

And that’s what we’re doing. Blend is designed to enhance the experience for loan officers and borrowers, no matter how the industry changes in the future.

The need for differentiation is the only constant

As interest rates fluctuate and as the focus of companies shifts to accommodate new trends and consumer demands, one thing that will remain the same will be the need for LOs to differentiate themselves — not necessarily by price but through service.

To deliver a level of service that drives new business and helps build relationships, they need one key thing: more time. And that can only come by being more efficient.

Why LOs are the backbone of differentiation strategies

While I believe technology is helping LOs achieve greater success, it’s important to realize that it will never replace the LO. Yes, we can use it to facilitate a great application experience, to expedite the process of asset verification and income verification, and all that good stuff.

But what happens when a customer comes to you with their own specific set of circumstances? What happens when they say “Hey, you know I’ve got good credit, but my savings are marginal. I need a little help with closing costs,” or “We’re in a super tight sellers’ market right now, is there something you can do to help me?”

That’s where the loan officer comes in. They take the time to understand the customer’s unique circumstances. They play with rates and come up with the best possible solution. Ultimately, they deliver the valuable personalization that customers really want.

And that’s why the future of loan officers is safe in my opinion. They are like the quarterback of the football team. If you take away the quarterback, who’s going to orchestrate everything?

The future of loan officers will be defined by the personal touch

The LO is more important than ever because they’re the ones who are building the personal relationship with the customer. They are the ones that the customer will remember when they are closing on their home, which is one of the most stressful times in their life. Providing excellent service — an oasis during the mortgage loan storm — can make the difference between a one-off transaction and having a customer for life.

And with automation, you’re freeing up the loan officer to spend more time doing that valuable work. Blend’s mortgage loan officer software takes away a bunch of those C- and D-level activities. All the manual stuff.

LOs shouldn’t need to worry about taking time out of their day to get wet signatures on a disclosure or to chase pay slips or letters of explanation. They should be more focused on doing what they do best, which is building relationships and ultimately, driving long-term business based on reputation.

And this is exactly what Blend is facilitating.

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