Lenders can expand their profit margin by originating loans with eLending technology. During the 14-20 days between a loan’s closing and its resale to an investor, interest is paid to the warehouse lender, which typically funds approximately 98 percent of the loan. The more time that adds up between the loan’s closing and resale, the more interest is paid by the originating lender—NOT CHEAP!
Therefore, lowering the amount of time a loan remains on the warehouse line is key to saving lenders money and increasing profit!
By originating loans with an electronic mortgage system, lenders can ensure that their loans will sell quicker. This is because investors do not have to spend as much time and money examining and storing them, since everything can be viewed on a computer screen and stored electronically. Fannie Mae has even made a commitment to purchase loans that are electronically originated in SMART Doc format within 48 hours of delivery.
According to our CEO Andrew Dubinsky, “This is a very economical alternative for mortgage banks. Investors are enthusiastic when it comes to eMortgage because of the ease and quickness associated with auditing these types of loans. The benefits eMortgage presents to both mortgage bankers and investors alike makes it much more appealing than the traditional ‘paper and pen’ way of doing business.”