How Efficiency Helps Doma’s Customers to Unlock Margin Uplift

“Failure to implement technology hurts lenders, too.” writes Max Simkoff in a recent article in Forbes on the current disconnect between demand and supply – notably of notaries – impacting mortgage refinances and resales across America.

“Expediency is critical in loan transactions,” adds Max. “The longer it takes to close a loan, the higher the risk of losing the deal. The time to close has increased across the board. According to mortgage software company Ellie Mae, the average closing time is 46 days for a purchase transaction and 49 days for a refinance.”

Perhaps what this industry needs isn’t necessarily the proverbial “more haste.” In fact, it needs more speed. Now, we can’t tell you the exact impact on your P&L until you become our customer, but let’s presume a lender makes an average of $10,000 per loan, and it costs $9,000 in expenses for the lender to complete the transaction. In our hypothetical, the profit is $1,000:

Assuming you save just one percent on revenue and expenses through evolving efficiencies with us, the input figures change to $10,100, and $8,910, and the profit output has grown from $1,000 to $1,190, which represents a $190 or 1.9 percent lift on a single loan.

So where and how does Doma help lenders find these profitable efficiencies? We covered the how recently in our white paper Human-Technology Collaboration in Customer Satisfaction. As for where we uncover efficiencies, the short answer is: everywhere we can.

Our primary focus is how your teams of loan officers and processors operate by using technology to complement optimized processes, and we also make every effort to make it easier to work with third parties, such as lawyers, notaries, realtors, and ultimately, your customers.

Getting the most out of LOs and LPs

Employee productivity and earnings

With our MI-driven technology and dual concierge-customer success offering, your LOs and LPs can spend less time on every file, with fewer touches, which allows each LO and LP to process more files overall in the same work period.

Further, Doma customers have seen pull-through rates (the likelihood of an application resulting in a closed loan) improve by as much as 9 percent, and we continue to develop solutions that will provide a greater lift over time. But beyond saving time, the greater certainty of a file closing successfully provides all parties – employees, third parties, and customers – a certain peace of mind that allows the professionals to focus on the next file.

Being able to transact faster provides greater opportunity to make money in any given month or quarter, which in turn leads to increased earnings for LOs, LPs, and SMs, especially when hitting bonus targets is thrown into the mix. And because Doma’s rates are lower, our customers tell us they find it far easier to attract customers, and price has become less of an issue.

Workforce planning

Being in an industry where employee levels are scaled up and down relative to seasonal and market demand, it is important to be transparent about needs. But although certainty is linked closely to market forces out of lenders’ control, imagine if instead of scaling your workforce like a yo-yo, you kept a relatively stable employee pool and simply scale how much each employee does.

By reducing the number of employees and hours required to close a transaction, and in turn, the average employee cost per file, you have the flexibility to streamline employee, compensation, and occupancy totals – all of which impact your bottom line.

If you believe there are mortgage efficiencies and profits to be realized at your bank or lender, get in touch and we’ll walk you through our solution and how we can tailor it to your pilot with us.