REAL ESTATE TECHNOLOGY NEWS
Issue Date: August 26, 2008, Posted On: 8/26/2008

Technology, lender partnership leads to growing customer base

Nebraska-based Mortech announced that LendingTree’s lender network customer base has grown by more than 450 percent in the past year.

As LendingTree’s core preferred provider of loan search and pricing software, Mortech has added AmericaHomeKey, First Meridian Mortgage, LSI Mortgage Plus, CFS Home Loans and Hunter Financial Group to the customer base.

LendingTree network lenders can use Mortech’s product and pricing solutions and customer relations management (CRM) applications throughout the mortgage lending process, according to the mortgage technology provider.

Mortech officials explained that the Marksman product combines features to create and manage borrower files from prospecting to close in an automated system and credit the system with the increase in client base.

“As a long-time user of Marksman and a new member to the LendingTree network, we’re already seeing the combined results,” said Allen Cravello, president of American Capital Corp.

Good technology choice in a down market
Mortech started as an LOS distributor in 1987 and got into loan pricing technology in 1995. Marksman is its sole product, delivering pricing and automated lead response functionality.

Lending software that streamlines the eligibility process and improves lead generation results represent a popular area of investment during this market downturn, according to Don Kracl, president of Mortech.
The technology is resonating well because of the inefficiencies in the online lending process.
Conversion rates of mortgage leads are typically 2 to 3 percent or lower, according to Kracl, but with the right technology in place, that can double.

“They’re typically more like direct mail responses,” Kracl said. “Some of our better clients will run in the 5-6 percent range.”

As the market becomes more complicated, the online lending sites that survive the mortgage crisis will have to include more eligibility functionality to steer consumers in the right direction.

“Historically, lending businesses have relied on price,” Kracl said. “Rather than best fit, they’ve gone to lowest-cost provider.”

Such practices were responsible for the rise of six-month ARM and Option ARM loans. To return to quality-centric lending, mortgage companies have to gather as much information from consumers as possible without alienating them. In addition, loan officers have to realize they aren’t in an order-taking environment anymore; they have to leverage the right tools to take better care of borrowers.

The key is better information, more visibility and top-notch service. According to Kracl, the first is critical because consumers don't want to deal with someone who won’t give them pricing information. Many lead aggregators, he said, won’t return that information.

In addition, automation in the lead tracking process can greatly improve the customer experience. For example, he said, the typical turnaround time for Mortech users is about 3 seconds, during which Mortech responds to a consumer, assigns the lead to a loan officer, notifies the officer and helps him contact the consumer. That all leads to a better chance of converting the customer — especially important, given that leads are expensive and margins are thin.

“As lenders, we’ve got to put as much emphasis on converting those prospects into clients, or it simply isn’t worth it,” Kracl said. “Advertising is too expensive, and the cost of getting leads is too expensive.”
The key to success isn’t lead volume, he said, but boosting conversion percentages to make the most of the leads you get.