The recent financial crisis has caused the mortgage lending environment to change dramatically. Lender resources are stretched thin by rising delinquency rates and unrelenting loss mitigation and foreclosure volume. Starting in 2009, the federal government announced several programs designed to help US consumers avoid foreclosure and to increase housing demand by providing tax credits. Title XIV of the Dodd-Frank Wall Street Reform and Consumer Protection Act will create new regulations to protect consumers, potentially leading to additional regulatory requirements for mortgage originators.
Mortgage lenders are now facing several challenges that are straining their operations and diverting their attention from other crucial business goals. Lenders that can respond to market and regulatory changes quickly have the ability to win market share, whereas lenders that cannot keep pace with these changes risk penalties, further losses, and potential disciplinary action.
Lenders are finding themselves in need of sophisticated operational capabilities in several key areas to successfully meet the heightened demands of today's regulatory and operational environment. Business process management (BPM) is a key enabler that brings together fragmented systems, provides transparency to processes across targeted areas of the enterprise, provides simulation capabilities, and strengthens activity monitoring. BPM can generate a host of benefits for lenders, including: cost reduction, compliance enhancement, and improvement in an organization’s change management capability.