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Explore how compliance can enhance efficiency in mortgage lending by streamlining operations and reducing costs.
When mortgage revenues are plunging and cost-cutting is imperative for businesses, compliance departments are rarely viewed as sources of newfound efficiencies. If you polled most mortgage lenders, they would probably tell you that compliance is a drag on efficiency.
This dismissive perception is flawed and self-limiting. An opportunistic compliance approach can actually streamline operations and unlock higher performance.
Here is how to make that work.
The key mindset shift is recognizing compliance's potential not just for enforcement, but as a catalyst for optimizing and re-engineering outdated processes. Ignoring for the moment the fear that comes with the word “re-engineering,” rules and regulations shouldn't be viewed as shackles, but rather as guideposts for productive iteration.
This starts with acknowledging that longevity doesn't equate to optimality.
Just because practices have been institutionalized for decades doesn't make them streamlined and probably just means they can be improved with new technology and updated guidance. As organizations evolve their products, channels, and business mix, it creates the imperative to revisit legacy processes through a modernized compliance lens.
Top compliance leaders excel at "operationalizing" rules - translating regulations into efficient execution rather than just policing them. They eagerly examine minute operational decisions and pressure-test whether those choices still make sense for today's realities. New distribution channels or amended regulations often expose opportunities to consolidate and streamline activities in a compliant manner.
This isn't about loosely interpreting rules or winging it based on assumptions. It requires deepening expertise to identify non-compliant practices, and then applying that mastery to construct optimized processes aligned with the latest guidance.
Compliance champions leverage their regulatory knowledge to navigate uncertainties, engage authorities for clarification, and drive conversations around what's truly permissible versus what's flawed conventional wisdom. With evolving guidance, opinions and even blogs from the regulating agencies it is unrealistic to think that what you were doing yesterday is going to be suitable for tomorrow.
Such compliance-powered optimization is especially crucial when mortgage markets turn and revenues plummet. When all the pricing and staffing levers have been pulled, optimizing processes offers one of the few remaining avenues for controlling costs.
Compliance's embedded knowledge provides an invaluable vantage point for pinpointing bloat, redundancies, underutilized capabilities and replacing manual efforts with cutting edge technology. Their cross-functional purview allows them to lead continuous improvement charges.
To be sure, there will always be relatively unchanging compliance activities like loan audits, documentation reviews and drafting of policies & procedures. These are the unglamorous counterweights to driving strategic efficiencies. But, perhaps strangely, that compelling duality is part of what draws many into the compliance field.
Balancing high-level systemization with granular operational optimization in pursuit of quality loan production and organizational health is a unique challenge. Elite leaders don't just enforce rules, they leverage compliance as a catalyst for enhanced effectiveness across an enterprise. Simply checking boxes misses the opportunity.
Achieving compliance mastery empowers the ability to streamline processes, remove wasteful spending, secure competitive advantages, and facilitate long-term business resilience. It's not an obstruction to efficiency, but an enabling framework for realizing it when applied proactively. Compliance can cut costs - that paradigm shift in thinking unlocks its potential.
How do we know this? Because Mortgage Cadence employs elite level compliance champions. Want to meet them? We’re a phone call away.
By Melissa Kozicki, CMB, CMCP, Director of Compliance at Mortgage Cadence
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Mortgage Cadence:
Alison Flaig
Head of Marketing
(919) 906-9738