Scott Happ is responsible for strategic direction and executive management of Mortgagebot. He has more than 25 years of financial-services and technology experience in the areas of portfolio management, mortgage banking, systems design and marketing. For this installment of In This Corner, Scott discusses how lenders and buyers are benefiting in the digital age. HW: Is home-buying moving more toward an online, digital presence? Scott: It’s not just moving; it has already moved. We’re in the midst of an unprecedented “sea change” in the way Americans interact with banks and credit unions. In the late 1990s, only a small number of consumers would have considered using the Internet to apply for a mortgage loan. But now that world has changed: A 2008 Deloitte Consulting study reveals that over 70% of all mortgage applicants (even in rural areas) start their search online. And new research from the American Bankers Association shows that today’s consumers actually prefer to use the Internet to conduct their financial affairs—in fact, they prefer it to every other business channel. HW: How do Mortgagebot and Mortgage Marvel make business easier for a mortgage lender? Scott: Banks and credit unions that do mortgage lending want to increase their loan volume without increasing their per-loan costs—so at Mortgagebot, we saw an opportunity. Mortgagebot automates the application, loan pricing, approval and disclosure functions for more than 900 banks and credit unions nation wide through our PowerSite mortgage point-of-sale (POS) platform. So we created Mortgage Marvel to link lenders and borrowers on a national scale—with Mortgage Marvel serving as a convenient, affordable, value-added online channel that works “24/7” to bring in more loans to hundreds of Mortgagebot clients. Rather than being limited to their traditional business footprint, Mortgage Marvel lenders gain a additional mortgage point-of-sale channel that gives them access to online borrowers they might have never before been able to reach, such as relocating families, second-home buyers, online mortgage-comparison shoppers, and so forth. And the lender benefits of Mortgage Marvel are very real: During calendar 2008, Mortgage Marvel generated $239m in application volume for lenders nationwide. And in just the first six months of 2009, Mortgage Marvel generated nearly $240m in application volume. HW: How is Mortgagebot creating a more educated homebuyer? Scott: Educated consumers make better mortgage decisions. So our objective in building Mortgage Marvel was to give consumers the Internet’s fastest, easiest, and most responsive mortgage-shopping service. We wanted to turn the traditional online mortgage-shopping model upside down: Instead of forcing borrowers to complete most of a mortgage application, we designed Mortgage Marvel to provide detailed quotes in seconds. Instead of requiring consumers to spend 30 to 60 minutes entering reams of personal information, Mortgage Marvel requires only a few fields of non-personal data that are entered on one screen, in just moments. Instead of selling mortgage “leads” to high-bidding lenders, who then (may or may not) call with offers, Mortgage Marvel provides direct-to-consumer quotes that are completely anonymous, so borrowers can decide when and how to contact the lender of their choice. Instead of offering day-old “teaser” rates, Mortgage Marvel’s rates and fees are actionable, real-time data feeds—direct from each participating lender’s “live” loan-product database. But there’s more to Mortgage Marvel than just a fast, consumer-friendly way to get accurate and anonymous mortgage rate-and-fee quotes. The Mortgage Marvel Web site also provides an in-depth Learning Center, with a helpful FAQ section, an interactive “Ask an Expert” forum, mortgage calculators, a Glossary, a current News section, and much more. HW: What challenges does Mortgagebot face in streamlining online information for mortgage shoppers? Scott: Regulatory issues are always a big challenge when presenting mortgage-related information to consumers. And with the flood of consumer-focused regulatory change that is inundating the industry, regulatory compliance is a hot issue—not just for lenders, but for technology providers and consumers alike. The good news is that we aggressively monitor the changes in government regulations. Then we carefully enhance and update our PowerSite POS platform to help ensure that our bank and credit-union clients are using mortgage technology that is always up-to-date. The net result for consumers is that when they use Mortgage Marvel or visit a Mortgagebot-hosted lender Web site, consumer borrowers don’t have to wonder if (for example) the payment information displayed complies with new government regulations—or if the mortgage disclosures they’ve received are accurate and fully legal. Instead, consumers can have confidence that the lender and the Web site they’re dealing with are fully compliant with the latest regulatory changes. HW: How has Mortgagebot adapted in the current foreclosure crisis? Scott: Mortgagebot serves more than 6,000 mortgage-origination Web sites for over 900 banks and credit unions nationwide. And because our technology comes into play at the start of the mortgage process, we do not deal with nor are we directly affected by today’s foreclosure situation. However, foreclosed homes re-enter the real-estate market at more affordable prices. And with today’s low interest rates, our clients are seeing a solid upturn in online mortgage-application volume. For example, the overall volume in mortgage applications that our clients generated through our online technology platform in the third quarter of 2009 was up 43% over the third quarter of 2008.