Why Credit Unions Should Outsource Mortgage Underwriting?

The constantly shifting mortgage environment and stringent mortgage regulations have created an increasing need among credit unions to start outsourcing mortgage underwriting.

In 2019, credit unions are more likely to face more challenges. On one end, there are rising mortgage rates that are combined with higher home prices (shrinking profits) while on the other end, credit unions have to bear the brunt of financial regulations. This combination leads to delays and backlogs. To get ahead of these two challenges, credit unions require an alternative business model. Something that helps them minimize their operational costs to a minimum while ensuring optimum efficiency levels of important processes like mortgage underwriting. Outsourcing mortgage underwriting can assist leading mortgage players to meet their needs, without facing delays or backlogs.

  1. Reduction in cost
    With the current unpredictable rate in the marketplace, keeping a firm control on resource costs is a big hurdle for credit unions. While borrowers wait for the rate to fall (likely to happen), the demand for the loans may fall and so will the profits. This is why credit unions have to cut back on the costs required for maintaining a team of in-house mortgage underwriters. The payment made to a team of experienced processors, appraisers and underwriters pose a huge expense for credit unions. Doing away with such resource related expenses would result in big savings. By outsourcing mortgage underwriting services, credit unions can save on cost, without losing on the expertise required to review loans, especially the ones that cannot be decided by automation.
  2. Increase in efficiency
    As per recent credit union reports, an outsourcing mortgage service provider will be able to decision a minimum number of 2,500 loans in a month, with a high loan approval ratio of 45%. If 45% is something that you are not looking for, you will be able to set the guidelines as per your needs and achieve an even higher approval rate. Experienced underwriters can churn out third party underwriting very fast, within a speed of 5 to 10 minutes.
  3. Better risk management
    Mortgage underwriting services providers stringently adhere to lender’s policies and criteria. This will help your credit union to stay away from risky loans. With the increase in regulations, underwriting service providers can assist credit unions in understanding the real risks and scope of risk that are a part of regulatory action.
  4. Competent underwriters
    A mortgage underwriting service provider can provide your credit union with a team of proficient team members. Through outsourcing, you can tap into the skills of competent underwriters who are skilled in every area of mortgage underwriting. This will save your credit union the trouble to finding and recruiting a team of skilled underwriters.
  5. Flexible pricing models
    Another benefit of outsourcing mortgage underwriting is the flexible pricing models that you can avail. An outsourcing provider can provide you with pricing models that match your requirements. You will be able to choose a model that is favorable to your credit union. Service providers are always more than willing to offer discounts, if there is an increase in the volume of underwriting.

At Outsource2india, we have more than 20 years of experience in offering quality mortgage underwriting services to credit unions across the globe. The proficient team of underwriters at Outsource2india combines automated as well as manual underwriting processes to help credit unions to address mortgage underwriting in a way that is affordable and efficient. With the steady rise in interest rates, you can leverage our skills and experience to make mortgage underwriting a success. With our mortgage underwriting services, your credit union can stay competitive. Read more about our mortgage underwriting services for credit unions.

Did you like reading this post? Did you find the information useful? Would you consider outsourcing? Let us know what you think about outsourcing underwriting support by leaving a comment in the box below. We, at Outsource2india love to hear from you!

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