Digital and analytics in sustainable mortgage lending operations

During our recent webinar, The State of the Mortgage Industry: Building a Sustainable Operating Model for 2021 and Beyond, we were fortunate to welcome three key industry figures to participate in an engaging conversation. This discussion revealed many insights surrounding change management in terms of digital transformation, leveraging data and analytics, and shifting operating model strategy across the mortgage lending market. These were, Sanjiv Das, CEO at Caliber Home Loans, Stan Middleman, CEO at Freedom Mortgage, and Paul Anastos, Chief Innovation Officer at Guaranteed Rate.

How did organizations manage change in 2020?

In our panel discussion, it was fascinating to hear the leaders describe situation upon situation driven and solved with the application of humanity and empathy, which were pivotal to manage an unprecedented situation. If we look back, 2020 saw some of the lowest ever historically known interest rates, which caused a huge wave of refinancing: from a long-term consumer credit standpoint, this puts consumers in a really good position. However, much of this was also linked to the economic destruction that took place in 2020, where large numbers of consumers experienced job loss and significant disruption to their incomes.

The knock-on effect was a lack of robustness in the economy, and likely other long-term implications that we’ve likely yet to experience. However, from a consumer standpoint, a real social responsibility has emerged. In speaking with Stan Middleman, CEO of top mortgage lender Freedom Mortgage, this social responsibility has become very apparent over the past year. He describes a situation whereby the industry essentially had to take on making payments and advance money for its consumers, be this to pay principal interest, taxes or insurance. The fears around whether or not banks would be able to manage this was palpable, but the continued movement to the non-banking sector and the distribution of this activity and caring for consumers, making their payments, and managing them in forbearance, was to Stan an obvious and central part to ensuring people could carry on with their lives so that they could focus on their health and happiness.

Stan also explained how Freedom’s past experience and disaster recovery exercises, as well as its focus on compassion and empathy, were helpful in positioning the company to create an environment of stability for its employees and customers:

“Our past experience allowed us to be resilient to deal with our realities, and we were able to tackle these issues in a compartmentalised fashion. The key to the whole approach was that first of all, compassion, understanding and empathy, and thinking of the consumer and the employee first, because they’re almost one in the same. We knew we were dealing with high degrees of personal fear and sometimes tragedy. So, our first and foremost responsibility was to give order and confidence to those around us and create an environment of stability. We also had the privilege of having practiced disaster recovery previously, and we deployed all these exercises at scale.”

Leveraging digital, talent, data, and analytics: in the new normal

It’s impossible to overlook the role that digital has played for every industry during the pandemic. The mortgage industry has notoriously faced digital challenges when it comes to the huge administrative burden and lengthy time-to-close cycle.

At EXL, we’ve been focused on shrinking the average time from application-to-closing by 30-40% through a combination of digitization, automation of manual processes and advantages gained by deploying a truly global – round the clock – workforce.

The past year has also seen the accelerated use of innovation and technology used to address the volatility and changes in volume we’ve been seeing. Our panel generated some thought-provoking insight, EXL Board Chair and CEO Rohit Kapoor provided an inspiring introduction to the discussion:

“It’s a fascinating time to be in the mortgage industry. We are working with our customers to leverage technology, talent, data, and analytics in today’s new landscape. We are seeing true ingenuity and innovation in both business continuity, and accelerated transformation as lenders focus on building sustainable operating models for 2021 and beyond.”


Throughout the webinar, the issue of talent acquisition and talent management was also raised several times. The panelists highlighted the dilemma of hiring staff remotely, managing them during market compression, retaining and scaling the talent and suggested that a mix of advanced technology and humane thought is the best way to tackle this. Growth of an organization is a key driver for growth of its people.


Most organizations today would say that use of data and becoming a data led organization has become a critical factor to long term success, and Sanjiv Das, CEO, Caliber Home Loans, was no exception. During the webinar, we discussed both the gaps and opportunities that exist in data for the industry as a whole:

“There is no business that has more data than a mortgage: it’s inundated with data. And yet, when you compare it to the payments industry, or the credit card industry, specifically, the use of data, the proportion of data that’s available is probably the lowest, and the data itself is very unorganized. In this $3 trillion industry, we’re very highly fragmented, and so it’s great that the industry is willing to join hands and begin to think about data in a very forward looking way, and to take unstructured data and make it structured.”

What Sanjiv’s insight highlights is one of the top challenges many organizations experience. Many of them have the data, but it is not accessible and it is not visible. This lack of transparency is a difficult obstacle to overcome.

However, there is also a second challenge, which is using the data and combining it with external data to make better business decisions for critical value. The word ‘manufacturing’ could be heard time and time again throughout the webinar in reference to data. The manufacturing process is the gathering of information about the consumer that ultimately becomes your customer: being able to do this at a low cost relative to your competitors and peers is where true value will be recognized. All participants recognized the value of being able to use the tools at their disposal to become lower cost producers of their products, and in gathering customers in the most cost-effective way.

It’s difficult to separate data and analytics from one another in any discussion, but it was apparent that our panelists saw both the value in having data available, and the complexities associated with analysing that data. Mere accumulating data on borrowers and property is not enough. Effective utilization of data is crucial. Enabling this would require knowledge on where to apply the data and what tools are to be provided to the underwriters and processors, which makes it important to invest in such tools and making their organizations ready for data to be deployed.

Building a Sustainable Operating Model for 2021 and Beyond

Our panel explored the use of AI and Machine Learning in depth, discussing the fine balancing act of attempting innovation at scale on loans that are securitized through government agencies. However, even within these confined parameters, success has been achieved and attaining existing customers has shown that AI and automation-driven efficiencies are worth it.

Measured steps towards operational model efficiency were common among the panelists. All agreed that the mortgage lending industry is ready for the adoption of better data analytics technology in order to keep up continued momentum for lenders to become low-cost producers, so that they can scale up and scale down in a business that is highly cyclical.

However, to truly succeed, regulators also need to get on board and adopt the same technology. This will make the industry much more sustainable, and more effective. While it’s been a complicated 12-months for the mortgage industry, we are optimistic about the possibilities for the future, and look forward to seeing our lenders develop further as the low-cost producers of the future.

Written by

Rajeev Minocha
Global Lead for Healthcare
Digital Transformation, CX & Solutioning