How Lenders Can Improve Appraisals for Their LOs
At Reggora, our mission is to make fast, high-quality appraisals the norm for mortgage lenders. Along the way, we’re able to solve problems that lenders often don’t realize they can fix. In part five of our value series, we'll show how creating visibility into the appraisal process helps to retain loan officers and improve the borrower experience. Using Reggora’s appraisal management automation, lenders have also increased referral business by 5%, resulting in additional revenue of $28 per loan.
Appraisals can operate within a black box for lenders, frustrating loan officers and hurting their ability to provide good service to their borrowers and real estate agents, who are anxious to see progress and results. These challenges lead to retention issues, especially as loan officers, a lender’s top producers, are being lured away with signing bonuses and attractive offers.
It’s increasingly crucial not to lose top-line revenue producers in a purchase-driven market. As we covered in our webinar on recruiting and retaining loan officers, addressing LOs’ biggest pain points around the appraisal process — lack of visibility and streamlined communication — can go a long way in retaining talent. In this article, we’ll examine how appraisal management automation plays a crucial role in bringing transparency and efficiencies to the appraisal process. And, as a result of creating better internal and external experiences, Reggora’s customers have seen their borrower referral business increase by 5%, or an additional $28 of revenue per loan file.
How Lack of Appraisal Transparency Hurts LO Retention
Visibility into the appraisal process for lenders and borrowers has become a tangled, complicated mess. Many lenders have created unnecessary levels of complication between borrowers, lenders, and appraisers to adhere to Dodd-Frank's appraisal independence requirements. But for LOs, this has meant they can't guide their borrowers through a critical segment of the loan process.
As borrowers expect their digital mortgage to resemble the minute-by-minute alerts they're used to with a DoorDash order, this silence from the LO is deafening. Providing LOs the ability to navigate borrowers through the appraisal is a massive gap that lenders must address.
Fixing a Long-standing Pain Point With Better Tech
Reggora’s appraisal management solution upholds appraisal independence requirements while streamlining communication among all stakeholders, most notably between LOs and borrowers, 24/7 visibility into the status of each order — both in their LOS and on a smartphone app. LOs no longer have to wonder if an appraisal has already been scheduled or call upon colleagues to check the status. Reggora empowers them to check any appraisal’s progress at any time, from anywhere.
How Reggora Improves Appraisals for LOs
Through appraisal visibility, automation, and streamlined communications, Reggora provides several key outcomes that keep LOs happy:
- Improves the Operations team’s efficiency and employees’ experience by eliminating the constant calls, texts, and emails from LOs who need regular appraisal status updates.
- Improves borrowers’ experience and increases referral rates by making it easy for LOs and processors to answer questions quickly.
- Improves LO recruiting and retention by fixing a long-standing pain point in the mortgage industry.
These outcomes are crucial, and especially in this down market, where recruiting top LOs and getting their business is a growth strategy for some lenders.
How Reggora Improves Appraisals for Borrowers
As mentioned above, Reggora also enhances the borrower experience in a few key ways:
- Through transparency and better communication.
- With easy online payment capabilities that cut out third parties and use the lender’s branding.
- By providing a streamlined, integrated digital experience at every touch point, from scheduling the appraisal to payment, thanks to Reggora’s open API and LOS/POS integrations.
By accelerating the appraisal process. The three benefits above help cut out delays and speed up the workflow, which leads to shorter loan cycle times — something that can be a make-or-break factor for borrowers.
Reggora Drives Cost Reduction and Increases Profitability
Providing visibility into the appraisal process is one of the ways in which Reggora supports a better appraisal experience for internal staff as well as borrowers. Lenders also derive value from Reggora’s improved quality control (savings of $81/loan), reduced revenue leakage (savings of $55/loan), automated appraisal billing (savings of $35/loan), and less time spent managing appraisals (savings of $87/loan).
All of the above-mentioned value drivers work in service of reducing lender costs by $258 per loan file. They also contribute to a better borrower experience, which for Reggora customers translates to a 5% boost in referral business — an increase in revenue of $28 per loan file. This, combined with the previously outlined value drivers, brings the total value of appraisal management automation to $286 per loan file for lenders.
Behind the Numbers
Before Reggora
10,000 loans x 5% referrals = 500 loans from referrals
After Reggora
10,000 loans x 5.25% referrals = 525 loans from referrals
An additional 25 loans x $11,003 revenue per loan = $275,075 added revenue
$275,075 added revenue / 10,000 loans = $27.51 added revenue per loan
Want to calculate how much your organization could save? Contact our mortgage solutions team for a free cost per loan consultation. Our team will quantify your current costs within your appraisal process and provide a detailed model of the costs you can eliminate.
This concludes our series on the areas where lenders face the most challenging issues in the appraisal process. In our white paper on the ROI of appraisal management technology, you can learn more about costly challenges and impactful solutions for quality control, revenue leakage, appraisal billing, appraisal management time, and visibility into the appraisal process.
