Cloud Lending Solutions (CLS) has announced a package of upgrades to its next-generation origination and underwriting platform.
CL Originate was introduced in response to the emergence of new technologies, changing customer behavior and an evolving competitive environment, CLS CEO Snehal Fulzele said.
A next generation platform for loan origination, CL Originate is a complete could-based loan origination and underwriting platform built natively on Salesforce.
Borrowers on platforms employing CL Originate can apply for a loan in six clicks, Mr. Fulzele explained.
- Basic data entry
- Identity verification
- Bank verification
- Data aggregation from both traditional and non-traditional sources
- Pricing generation sent to borrower
- Selection and real time funding
Mr. Fulzele said plenty of work was needed to make the six-click process a reality. The key was to generate data from diverse sources.
The changes were necessary because borrower behaviors have changed too, Mr. Fulzele explained.
“They care about the onboarding experience the most. They don’t care where the funds come from.”
Mr. Fulzele said the traditional onboarding experience can take days, especially for more complex deals like property transactions where many parties may be involved. That is the reason for the second enhancement.
CLS now offers a Deal Room for those transactions. Using a a complex property transaction as an example, Mr. Fulzele said many parties can have a stake in the transaction – the buyer, seller, appraiser, title and lien holders and guarantors.
The Deal Room allows all parties to communicate their requirements and monitor the deal’s progress in a secure environment, with each party only having access to those aspects they have a stake in.
“Say you apply for a loan from a bank,” Mr. Fulzele said. “The loan officer receives the borrower’s information but then has to go and individually ask guarantors, insurance companies and others for it.”
In such situations, deals can be delayed for days because one party is unaware everyone else is waiting on them, Mr. Fulzele added.
“The parties can check the real time status of the deal,” Mr. Fulzele added. “Once the Deal Room is created each party will be notified of all the tasks that are depending on them.”
The Deal Room is easily accessible from common mobile devices and tablets.
Mr. Fulzele said CLS has built integration with major social networking sites so they can access information during the underwriting process. It is up to each one to decide to which extent they will rely on it.
It is most often employed for identity and employment verification, he added.
Its effectiveness is partially driven by where the platform’s primary customers live. In data rich environments like the United States, there are many ways to obtain the needed information on people.
“In the U.S., you cannot use social media data to underwrite a loan,” Mr. Fulzele explained. “You cannot come up with an interest rate based on social networking data.”
That is changing in other countries where laws are less restrictive, Mr. Fulzele said. Many emerging regions extensively mine such sites, partially because they have fewer avenues to pursue during the underwriting process.
Given the speed with which data can be mined, and the ability of the top platforms to quickly access it on everything from social media to bank accounts, are we near a tipping point where the process cannot be improved without possibly sacrificing underwriting quality?
Mr. Fulzele thinks the industry better be careful about that.
“That is a possibility. Most solid underwriting processes require the use of sensitive information such as Social Security Numbers that are not easily available from other sources.”
“Larger, more complex asset types with high values will definitely reach a tipping point.”