5 Reasons to Upgrade Your Loan Origination Software

The Ultimate Guide to Selecting the Right Loan Origination System

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Upgrading your loan origination system (LOS) is one of the most important decisions your financial institution will make. With the right advice and robust tools, you’ll increase efficiency, manage costs, and meet regulatory challenges. The right solution is out there. This guide will help you find it.

What can you expect if you upgrade your LOS?

You may have tools in place to streamline your loan processes and gain efficiencies, but you need an end-to-end solution. Or maybe you’ve built something in-house that has been good enough, but it can’t take your loan origination processes to the next level. You might be using an outdated, inefficient LOS that is costly to operate and—worse yet—costing you business.

How will you know when it’s time to upgrade your LOS? 

In recent years, many banks and credit unions have been motivated to up their lending game due to increased competition from non-traditional players like marketplace lenders.

Because efficient, intuitive lending processes are integral to your business, smart financial institutions study the options available to find the most efficient systems to maximize their profitability, utilization of customer relationship data—and their investment in technology.

When you upgrade to a state-of-the-art LOS, you can expect:

  • Improved accuracy and speed. Boost your operational efficiency and make faster, more reliable credit assessments.
  • Added flexibility and customization. Take the headache out of software integration. Modern LOS platforms are scalable and configurable around your needs.
  • Increased collaboration and usability. Ditch the silos, and keep everyone in the loop with powerful reporting dashboards.
  • Maximized profitability. Stay competitive, and get better results by leveraging analytics to manage costs.
  • Simplified compliance. Say goodbye to regulatory pressures with increased security.

Improved accuracy and speed

Speed and data accuracy are crucial factors in the right LOS. Today’s best solutions will help you make faster, more reliable credit assessments with automated decisioning. 

This is important for improving the customer experience. Recently, the Federal Reserve revealed in a survey that nearly half of loan applicants were dissatisfied with the long wait for a credit decision. Similarly, 44 percent of applicants were unhappy with the complicated application process. 

These insights can help ensure your new loan management software addresses these issues and supports a more positive and efficient customer experience.

The right LOS solution will:

Create robust credit memos

Rather than just standard reports, your LOS should be pulling out accurate, pertinent data for each credit memo. For improved accuracy, the ideal system will pull information from different systems to create a more complete credit memo. These capabilities should allow you to maximize opportunities within the loan portfolio accurately.

Process loans efficiently

The speed of decision making in the lending arena is essential—success comes to institutions that capture and decision loans with the least amount of time and customer friction.  Borrowers today demand the ability to move quickly and easily each step of the way. You can achieve this speed with an LOS that leverages analytics and scoring, allowing you to respond to customers quickly and with the minimal investment of time and resources.

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Added flexibility and customization

Modern loan origination platforms are scalable and configurable around your needs.They can help you reduce the number of documents you’ll need to manage and even be configured around your needs and evolve along with your institution as business needs change.

Rather than force you into a practice that is not best for your institution, an updated LOS provider will configure a system with the flexibility to meet your needs.

Today’s top-of-the-line loan management software solutions include:

Cloud-based infrastructure

A cloud-based solution will give your financial institution a competitive advantage in terms of flexibility and scalability.

Institutions can ensure all critical information is securely stored and accessible from one system, which also promotes heightened visibility of the loan pipeline. 

Customizable dashboards

A great LOS can help you leverage the power of integrated data and make it easier to consume through customizable dashboards.

A system that enables employees to configure their view of data based on job role ensures each employee sees the data that is most relevant to them and their objectives. 

Western Alliance Bank

Find out how Western Alliance Bank has grown its assets from less than $3 billion to almost $20 billion and efficiently managed its subsequent increase in loan volume while efficiently managing full-time employees.

View Case Study

Increased collaboration and usability

Robust, intuitive loan origination platforms with powerful reporting dashboards can provide an enterprise view of your portfolio that will make it easier than ever to keep an eye on your lending pipeline.

Today’s best LOS solutions ditch the siloed working habits. While you can—and many financial institutions do—take the “best in breed” approach, where they implement the best-siloed solution for each business function and attempt to integrate the solutions, there are bound to be integration challenges that leave employees in the dark. 

With the right loan origination software, your bank can accomplish more together without the added cost of hiring and training employees.

An updated LOS will:

Keeping everyone in the loop

Cloud-based LOS supports a collaborative lending workflow across multiple devices, where even remote employees like commercial relationship officers that are onsite with customers can help push loan requests through.

Increase employee bandwidth

Such a system will also give employees time to focus on tasks that positively impact your financial institution’s bottom line and serve customers better, whether with the computers on their desktop or with the supercomputers in their pockets. 

Maximized profitability

The right LOS solution will help you leverage analytics (and integrated data) to manage costs. They can do everything from flag high-performing credits and find tomorrow’s opportunities to streamline risk management and proactively identify potentially troubled accounts.

Whether you have a robust analytics engine now or rely on cobbled-together reports to drive decisions, make a list of the data you have access to and identify what kinds of analytics you use or want to use in the future.

Ultimately, a modern LOS will help your financial institution understand your customers’ specific needs and how to best meet those needs in a way that strengthens relationships and increases wallet share.

A top-notch LOS will help you:

Leverage the power of integrated data

This allows a financial institution’s board members and C-suite to tailor a dashboard to spotlight key areas of interest and view all the data necessary to design growth strategies for the upcoming year. This also empowers your chief lending officer with greater visibility of his lending pipeline.

Stay competitive and get better results

The insights from your data and analytics can help you pinpoint profitability at the account, branch, region and enterprise level, as well as highlight the products and services that generate profitability. Your institution can capitalize on the performance of those top-performing accounts and understand which accounts or relationships need nurturing. 

Marquette Bank

Find out how Marquette Bank has improved its credit memo creation time by 25 percent and eliminated more than 70 percent of paper reports, all while enhancing its pipeline process to encourage strategic sales planning and nurture relationships with valuable clients.

View Case Study

Simplified compliance

Increased security and compliance are just two of the competitive advantages you’ll benefit from when you upgrade your LOS to a sophisticated, cloud-based infrastructure that keeps critical information securely stored yet accessible.

When updating an LOS, there’s one question that institutions often don’t ask until it’s too late: is your existing technology compatible with your LOS? 

You must have up-to-date technology if you want to use the latest and greatest in LOS technology. You simply cannot move forward if your internal technology is behind the times.

An updated LOS will:

Relieve regulatory pressures

Security and compliance requirements call for a current technology platform. A new LOS will allow you to move forward with an infrastructure that meets all regulatory requirements. 

Streamline internal processes

You can relieve yourself of the headache of siloed software. An up-to-date LOS will ensure all critical information is securely stored and accessible from one system. 

First Tennessee Bank

See how Baker Hill’s customized branch online loan application software helps First Tennessee bank employees to more efficiently gather applicant information and easily share information from the field to improve transparency across the origination process.

View Case Study

Getting started

Upgrading your LOS doesn’t have to be overwhelming. With the right guidance and solution, a new LOS can position you for success. Reduce the complexity of your loan origination process with Baker Hill NextGen®. Our solution and team of trusted experts will help you navigate the upgrade smoothly.

You can (and should!) expect more from your loan origination software.

If you’re behind-the-times and ready to get up-to-date, it’s time to partner with loan origination software partner with years of experience that knows the banking industry and is dedicated to its clients and their successes. 

Baker Hill’s all-in-one loan origination software is the end-to-end solution you need to take your loan origination processes to the next level. 

How to prepare for LOS integration?

  1. Look for an end-to-end solution
  2. Find an LOS partner with a proven track record of integration success
  3. Lean on your LOS provider as a partner and adviser
  4. Approach the project in phases
  5. Be patient and keep your eye on the prize

Your partners for an LOS upgrade

Baker Hill’s sophisticated technology solutions enable banks and credit unions to compete aggressively in today’s complex lending environment. We leveraged more than three decades of lending and risk management expertise to build Baker Hill NextGen®, the cloud-based common loan origination and risk management solution built with the latest technology to help financial institutions address regulatory and competitive pressures while delivering the very best digital consumer experience. 

We promise to add value along the entire buyer cycle—from consultative selling to the training and education that helps our clients maximize their investment in technology. That’s why more than 500 banks and credit unions trust the experts at Baker Hill to help them work smarter, make sound credit decisions, and drive more profitable relationships.


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