The real estate market is a real rollercoaster, isn’t it? A year ago, mortgage brokers and lenders were struggling to keep up with demand in a super-hot market. Now, after multiple rate rises, the market has cooled right down.

October 2022 saw a 2.7% fall in housing approvals, 17.1% lower than a year ago. In a softening market, it’s inevitable that demand will decline. For lenders, fewer buyers equals less loans, putting pressure on your bottom line. Then there’s the threat of emerging digital lenders disrupting the market.

While you can’t control external factors, you can control how you approach the pre-approval process. If you’re worried about a slowdown in your institution’s pipeline of pre-approvals, now is the time to review your processes.

No matter the economic environment, responding quickly to change is the key to long-term success for lenders. Leveraging digital solutions like IDP (Intelligent Document Processing) is one way you can help your organisation always meet the needs of your market.

Manual pre-approval processes no longer cut it

Earlier this year, CoreLogic revealed just how long customers are prepared to wait for home loan pre-approval. The results are eye-opening, especially for firms still persisting with manual processes.

When it comes to approval times:

• 1 in 2 consumers prefer an answer within 24 hours
• 1 in 3 want a 3-day turnaround
• 1 in 4 will wait a week or more.

In a fast-paced world, where consumers can get same-day delivery, it’s no wonder they expect the same level of speed and convenience in everything they do.

This is where the rubber hits the road for lenders.

Traditionally, home loan pre-approvals have not had quick turnarounds. Manual checks, multiple reviews, credit investigations and other assurance activities take time. The decision to provide hundreds of thousands (if not millions) of dollars in credit needs to be carefully considered.

However, technology has progressed and now there are ways to speed up the process for lenders. This will not only deliver an enhanced experience for customers, but it will also make your business more agile and responsive to changing economic conditions.

Why you should consider IDP

Intelligent Document Processing (IDP) combines optical character recognition, machine learning, artificial intelligence and deep learning to process structured and unstructured information.

For the pre-approval process, IDP can automate and streamline time-consuming tasks, like credit checks, data validation and verifying ID. By digitally capturing documents at the source, IDP eliminates the need for manual data entry while also improving data accuracy.

Routing documents through automated workflows, IDP can speed up the approval process too. Exceptions are quickly identified and diverted to approved delegates for action, maintaining data quality and assurance.

Easily integrated into your existing tech stack, an IDP solution connects the dots for your organisation, helping your business become more agile and responsive.

3 reasons to incorporate IDP into your home loan pre-approval process

Reason 1: Unparalleled speed

One of IDP’s big advantages is speed. Traditional pre-approval processing is not exactly fast. According to Canstar, most pre-approvals take a few business days to several weeks. Considering 50% of applicants prefer to have an answer within 24 hours, a faster approval process will make you more competitive and free up your pipeline for more applications.

Leveraging a mix of technologies, IDP streamlines the assessment process for faster decision-making. From digital capture (even of hand-written documents) to automated routing, data validation and customer notifications, IDP eliminates manual processing, saving time, money and valuable resources.

Reason 2: Customer experience

It’s clear that consumer expectations are shifting. Aside from a fast response, they also value the convenience of online accessibility. If you think loyalty trumps digital, think again. A recent PWC survey revealed 42% of millennials are likely to explore new products and services in the next 12 months. Meanwhile, the digital experience is key for 72% of all respondents.

An IDP solution helps you deliver an enhanced digital experience for your customers. Harnessing AI and ML,  structured and unstructured data is accurately consumed, together with the correct context. Workflow automation ensures a smooth process, with exceptions directed to agents for resolution and customers able to be kept informed every step of the way.

Reason 3: Business agility

One of the most important reasons to consider IDP for home loan pre-approvals is the boost it provides to business responsiveness. To remain competitive in a market that swings wildly from peaks to troughs, you need to move with the pendulum. This means ensuring your business can cope with high demand, thrive in slower economic conditions and see off digital disruption.

For lenders, streamlining the pre-approval process is key. IDP provides the platform for full digitisation and automation, giving your business an edge. Increased visibility and enhanced data accuracy delivers valuable business insights to enable better decision-making. Improving business agility, a digital-first approach also positions you favourably in a crowded market.

Leverage next-level pre-approvals with Hyperscience and Umlaut

Umlaut is the leader in streamlining processes for finance and insurance firms. We know you’re in the industry to help people, not get caught up in admin. That’s where we can help. Building on your current technology stack, our digital solutions integrate seamlessly to unlock a range of time and cost savings for your business.

Partnering with Hyperscience, we offer a full suite of intelligent document processing and automation solutions. Leveraging the power of AI, ML and deep learning, the Hyperscience platform connects the dots for your business, taking document processing to the next level.