Seize the market moment staying nimble in a challenging lending environment

A lender could be forgiven for thinking a turbulent market – like the one we’re seeing today – is the worst possible time they could upgrade their technology. Loan volumes are low, would-be homebuyers are reluctant to make a move, and interest rates continue to climb. Isn’t now the time to tighten budgets and cut spending?

It turns out avoiding short-term pain could be more harmful in the long run. After holding discovery sessions with 32 banks, credit unions and IMBs (independent mortgage bankers) of all sizes, we found decision-makers unanimously recommended upgrading technology while the market is slow. Here’s why.

Preparing to pivot

It’s not enough to focus only on the here and now. Even in a market as challenging as this one, organizations committed to staying competitive are looking to the future. They will take the discomfort of investing in technology now because they know the right investment will help them when the market rebounds.

Take home equity loans for example. In March 2023, home equity lending was one of the only origination channels experiencing growth, and lenders that were using a competitive LOS were able to manage home equity loans on the same platform as mortgages, while leveraging integrated intelligence tools to support borrowers in that growing channel. That’s the power of a pivot when the right tools are in place.

The time to invest is now

Decision-makers agree it can feel uncomfortable spending on technology when bottom lines are crunched. But they also caution that by the time we’re back in a boom market, it’s already too late. Lenders who only prioritize upgrading technology when volumes are high risk losing business or impacting borrower and employee satisfaction. Imagine trying to keep up with soaring loan volumes while also overhauling the technology that makes that possible.

During a down market, organizations can devote time and attention to deploying new technology correctly and effectively. Employees have time to adapt to new systems and decision-makers have the cushion to develop a methodical and bulletproof rollout plan that can benefit their organization in the long-term.

At a minimum, the decision-makers recommended lenders explore alternatives to help process loans more efficiently and at a lower cost. But for those planning to stay ahead of the digital maturity curve, there’s no better time to act. As the market recovers and volumes increase, lenders with the most advanced technology will be better equipped to handle the increased demand for mortgages.