The meteoric growth of Rocket Mortgage has demonstrated exactly what loan officers need to do to continue to be competitive in the marketplace of tomorrow. The answer? Adopt a hybrid mortgage lending process.

A hybrid mortgage approach combines the traditional, relationship-heavy, lending techniques with modern technology aimed at enhancing and streamlining the process. Below, we’ll show you how to do it.

“I think that branch loan officer is a dying profession.”

These were the words of Quicken Loans’ chief economist, Bob Walters. Although Quicken Loans / Rocket Mortgage originated $79 billion in 2015 mortgage volume, we believe the role of the loan officer isn’t dying, but it absolutely has to evolve.

The draw to Rocket Mortgage: mortgage automation

Technology. Speed. Simplicity. These are the buzz words you hear when reading about Quicken Loans’ Rocket Mortgage product.

Read between the lines and it is easy to understand what REALLY drives their mortgage lending prowess: automation and efficiency.

The results are impossible to ignore. “Nonbank” lenders, like Quicken Loans, have seen their share of the residential mortgage market soar.  In 2007, these nonbank lenders originated 23% of the residential mortgage market. By 2014 that number had grown to 43%.

They’ve developed a system that makes it easy for a potential borrower to submit the documentation necessary to get an underwriting decision. Income, assets, debts, credit scores, and the like are automatically pulled into the system while complex algorithms work behind the scenes to build a set of loan options.

Automated document and asset retrieval alone is a big draw (read: time saver) for borrowers, but they also add on some nice features like eSignature and custom pre-approval letters for borrowers.

This all sounds great in theory, but there are some significant drawbacks to this automated system as well.

Issues with Rocket Mortgage: lack of service and mortgage expertise

Imagine this scenario: you are getting ready to buy a home, you create your Quicken Loans account, enter your personal information and pull all of your income and assets into the system and voila you have some loan recommendations.

Now the fun begins!  With Rocket Mortgage, the client can customize their loan options by adjusting slider bars for things like closing costs, loan terms and interest rates.

This is so exciting!  I’ve got my perfect loan setup, now let me hit the “See If I’m Approved” button aaaaaaaannnnd: Denied.

What happened? Now what? I did everything right!  WHO DO I TALK TO?!?!

The only option at this point is to click another button to speak with a call-center mortgage broker who, without knowing anything about the borrower, will try to figure out what happened. So much for fast and efficient.

For someone making what is potentially the biggest purchase of their lives, this is just not acceptable. The issues arising here are what prompt the need for a hybrid mortgage process.

This call center also happens to be attempting to fill the role that the loan officer has in a traditional setting: advice and guidance in a complicated and emotional transaction, answers when you need them, knowledge of the underwriting requirements necessary to get your loan approved, and the follow-through needed to get you to closing.

The loan officer is also a member of your community. They can make recommendations on local Realtors, when to refinance, or help you with a home equity or HELOC (products Quicken/Rocket doesn’t offer) when the time is right.

You just can’t ever get that level of service by using Rocket Mortgage.

Incorporating technology into a hybrid mortgage process

The key is to learn from the lessons taught by borrowers through their use of Rocket Mortgage: borrowers want a simplified and streamlined process, with easier access to information, and modern tools at their disposal.

These are services that a loan officer CAN provide, with the right systems in place, while also adding tremendous value from a 1:1 relationship with borrowers.

The point-of-sale

The POS is a great example of the benefits a LO can reap by incorporating advanced technology into their origination processes.  The modern mortgage point-of-sale provides the technological efficiencies and mobile-friendly experience that borrowers desire:

• Intuitive and secure portal to streamline document collection.
• Integrated services for ordering direct-source credit, assets/deposits, employment, and income verifications.
• Automated loan status updates to keep borrowers informed throughout the whole process.
• eSignature.
• Guided, interview-style loan application.
• Mobile app w/ photo upload capabilities.

Not only does the POS platform do all of this for the borrower, but the tangible benefit to the loan originator allows them to get a loan file into underwriting faster, with a high level of accuracy. All of this conspires together to help get loans funded faster and smoother than via legacy processes.

This is all borrowers are really asking for, and why they’ve turned to the Quicken Loans’ / Rocket Mortgages of the world. The emphasis is placed on efficiency and transparency.

The bottom line

You don’t want to be Rocket Mortgage. The goal of Rocket Mortgage is to essentially eliminate the loan officer from the mortgage origination process. However, it is impossible to ignore the growth of nonbank lenders like Quicken Loans. That growth surge has demonstrated the direction the consumer is demanding that the industry move: forward.

With the advent of new technologies and programs like Fannie Mae’s Day 1 Certainty, it’s certain that the industry has heard the warning bells loud and clear. You must evolve, or you will be passed by the competition.