Bucking Trend, Lenders Seek In-House Technology

Submitted by Ronald Tennant with Metrocities Mortgage:

MBA (5/22/2008 ) Palaparty, Vijay
While technology trends tout cost and time efficiencies of outsourced offerings such as software-as-a-service, Motivity Solutions, Denver, has a different outlook.

The company has concentrated on building lending and business management technology in collaboration with mortgage bankers—focusing on the flexibility aspect of in-house systems. Through its LenderBuilt initiative, Motivity Solutions partnered with Assurity Financial Services LLC, Englewood, Colo., to co-develop its Movation system.

In December, Motivity Solutions launched LenderBuilt to identify lender partners to collaborate in building an enterprise mortgage system. Recently, the first module of the system, business intelligence and reporting, was released to executives at Assurity Financial.
“In choosing technology, SaaS was a consideration and the decision depends on resources and strategic objectives of a company,” said Calvin Hamler, managing partner at Assurity Financial. “Companies certainly have the option of adopting hosted solutions. However, what we wanted was a higher level of access and control of data. We felt the hosted option was not congruent with our company. It’s all about flexibility and we wanted the ability to control data, its manipulation and drive the reporting and overall applications.”

Tyler Sherman, CEO of Motivity Solutions, said business intelligence of in house systems is greater than in outsourced technology. He also said companies, depending on their size and resources available, might not have the IT staff or expertise to host an enterprise system and that SaaS would be a good option for those types of companies.

The business intelligence and reporting module integrates Assurity Financial’s existing systems and rolls data into one data warehouse. “Assurity had four to five disparate systems and the first goal was to integrate them to get one version of the truth and have data in one place,” Sherman said. “We added business intelligence to the data for analysis and reporting, taking it one step further.”

Motivity Solution’s database is built on MISMO standards and Sherman said that lenders who follow these standards do not pose as many challenges in the data integration phase. “But most systems are legacy systems and require exporting data to MISMO first. Mapping to different systems is one of the biggest challenges. They first have to be mapped into the MISMO data warehouse. One version of the truth has to exist and that’s a given.”

Sherman said integrating data also poses major challenges due to variances in the security measures of the different systems. “They all have security but not field-level security,” he said. “For example, a loan officer could change the loan amount field even after the loan is closed and funded. Integrating data requires creating a master of record where one system takes precedence over all of the others.”

Assurity Financial said the modular approach in development has been beneficial, not disrupting current business and also not shocking the functionality of its business. “We will slowly retire various pieces of the current systems,” Hamler said. “We don’t expect much disruption.”

From a business versus technology perspective, Hamler said Assurity Financial’s IT side integrates into its business side. “It has taken a while, but we have been able to build on core competencies to promote understanding of the business at all levels. It’s important not to be myopic in pursuits. It’s critical to see business objectives and use human capital. Software and other IT efforts are to support business objectives.”