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The Ultimate Guide to Loan Origination Software
The Ultimate Guide to Loan Origination Software 2
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
Why Switch to a New LOS? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
LOS Features You Need . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
Common LOS Integrations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Steps in the LOS Buying Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
Steps to Implementing Your LOS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Which Calyx Product Is Right for You? . . . . . . . . . . . . . . . . . . . . . . . . 21
Table of Contents
The Ultimate Guide to Loan Origination Software 3
Introduction
Running a successful mortgage
operation is tough. Interest rates
are higher than in the past, thus
discouraging homeowners from
considering buying or refinancing.
Non-bank lenders account for
more than half of mortgages.1
Stricter federal lending guidelines
have changed the way lenders
operate and have even driven
some from offering mortgages.2
And consumers have plenty of
mortgage options to choose
from—so they won’t hesitate to
overlook ones that fail to provide
an optimum borrower experience.
With all these challenges,
lenders and brokers can’t afford
to let inefficiency or obstacles
get in the way of successful
processes. This includes the
loan origination software (LOS)
mortgage professionals use to
help borrowers secure financing
and realize their home ownership
dreams. A great LOS is the perfect
complement to the hard work
mortgage teams put into the
process while a mediocre LOS is a
barrier to success.
Mortgage bankers and lenders
need quality loan origination
software to keep their operations
profitable and stave off the
competition that seems to be
coming at them from every angle.
Broker and lending teams need an
efficient LOS to drive more loans
without getting bogged down in
busy work.
With all these challenges, lenders and brokers can’t afford to let inefficiency or obstacles get in the way of successful processes.
The Ultimate Guide to Loan Origination Software 4
Ultimately, borrowers need a customer-focused system to take some of the
stress and inconvenience out of the process.
This guide will focus on why you might need a new LOS, features you should
look for in a solution, and steps toward choosing and implementing the best
software for your needs. Our guide will show you how to find software that will
always be there when you need it.
The Ultimate Guide to Loan Origination Software 5
Why Switch to a New LOS?
Understandably, some mortgage
professionals are hesitant to ditch
an existing LOS. They may have
invested significant capital into the
software, and the idea of spending
more money for a new system
when the old one is adequate
seems wasteful. Moreover, you and
your team already know how to
use your LOS; taking the time to
learn something new may feel like
a hassle. Why change the status
quo, even if the status quo
is frustrating?
Moving on from a disappointing
LOS is more than an organizational
preference—subpar software
impacts your mortgage operation’s
bottom line. An inefficient LOS
results in fewer closed loans,
which leads to fewer profits. The
cost of a new software is justified
if the investment saves money
and generates added revenue.
Furthermore, if competitors are
closing loans faster than your team
and providing a better customer
experience, that’s lost business
for your company. The current
mortgage environment is difficult
enough; your LOS shouldn’t
contribute to the challenge of
running a successful
mortgage business.
The Ultimate Guide to Loan Origination Software 6
Consider these factors when deciding if it’s time for a software upgrade:
Speed
Securing a mortgage takes long enough for borrowers; an inefficient loan
origination process shouldn’t cause further delays. If your LOS is trying to
deliver new features with outdated technology, a lack of speed is inevitable—
and could have your customers wondering if they should switch to a
more nimble competitor. Modern technology is essential to attracting and
impressing today’s borrower. Features such as e-signatures, digital interviews,
and borrower web portals, as well as a platform built to run on mobile devices,
improve speed and make life easier for borrowers.
Moving on from a disappointing LOS is more than an organizational preference—subpar software impacts your mortgage operation’s bottom line.
Data Management and Workflows
An LOS that bottlenecks your data management and workflow increases
frustration and decreases the number of loans that can be closed. Even in
this digital age, some platforms still require paper forms and manual and/or
duplicate data entry. An LOS with easy access to document storage can greatly
enhance efficiency.
The Ultimate Guide to Loan Origination Software 7
Current Workflows
Another inefficiency of a stale LOS
is the inability of multiple people in
different roles to work on various
components of the loan at the
same time. Software can allow
users simultaneous access to files,
thus facilitating faster workflows
while maintaining coordination
and compliance.
Trust
LOS providers vary not only in
the quality of their product, but
also in the quality of their service.
Too many lenders have been
burned by software upgrades
that never materialized, features
that didn’t work as planned (or
weren’t included), and promises
that weren’t kept. If you can’t
reasonably trust the provider that’s
currently licensing its LOS to you,
find a partner that is committed to
improving processes and enabling
your team’s success.
Remote Capabilities
The ability to work remotely isn’t
just an issue of work/life balance;
it also benefits borrowers. Loan
professionals can work wherever
and whenever they need to
and take the process directly to
borrowers. Again, this efficiency
boosts the number of mortgages
that can be successfully processed,
which ultimately boosts profits.
Weak Reporting
Robust, customizable reporting
(including state and regional data)
gives lenders the intel necessary
to make better decisions in
the long term. An LOS without
strong reporting capabilities fails
to provide the comprehensive
overview lenders and brokers need
to drive their mortgage business.
The Ultimate Guide to Loan Origination Software 8
Compliance
State and federal loan guidelines
are constantly evolving, and the
Consumer Financial Protection
Bureau (CFPB) continues to
provide oversight on Fair Lending
practices, borrower rights, security,
and more. An efficient LOS
includes all federal compliance
mandates with additional training
features available as add-on tools.
Cloud Capabilities
Not too long ago, the idea of an
LOS and any mortgage platform
operating in the cloud was a pie-
in-the-sky dream. Today, the
technology is not only a reality,
but also a preference for many
lenders and brokers who seek
greater agility, less IT burden,
hosting hassle and cost . Moreover,
borrowers and loan professionals
like to tap into the software
anytime and anywhere they wish.
Changing Workflow
Requirements
Workflow needs vary among team
members, your system should be
nimble and ready to address those
varying needs. Today’s mortgage
operation must scale as the
business grows and the
market changes.
Today, the technology is not only a reality, but also a preference for many lenders and brokers who seek greater agility and less IT burden.
The Ultimate Guide to Loan Origination Software 9
LOS Features You Need
Loan origination software—
and, really, the entire mortgage
process—has come a long way in a
relatively short amount of time. For
example, the idea that a borrower
could apply for a mortgage on their
cell phone was far-fetched just 10
years ago; today, it’s functionality
that consumers not only enjoy, but
also expect.
To effectively compete in the
mortgage industry today, lenders
and brokers require certain modern
functionalities, as well as features
that go above and beyond what you
might expect from a typical solution.
After all, today’s innovations are
tomorrow’s basics. Here are several
features you should look for in your
next LOS:
Thorough Compliance
Robust compliance functionality
not only saves time, but also keeps
you from compliance issues with
the CFPB and other regulatory
entities. A great LOS should
understand and work with current
requirements, be customizable to
the user’s unique needs, and have
the ability to be easily updated
so when guidelines change, the
software can quickly adapt.
Borrower Point-of-Sale
Capabilities
Point-of-sale (POS) lending is
the current trend in the banking
industry, and it takes on added
importance for mortgage
operations that compete with non-
bank lenders that tout their simple
digital application processes.
Learning how the integrations process data to increase efficiencies and cut costs is an integral part of determining the value of your new system.
The Ultimate Guide to Loan Origination Software 10
Automated Pricing
Scrambling through the system to
determine a mortgage product’s
costs to the borrower can be time-
consuming for the lender or broker
and the client alike. Moreover, this
manual approach may not find
the best pricing and/or product
for either party. Automated
pricing takes the accumulated
loan origination data and quickly
and accurately delivers a range
of options, with costs, so you can
determine the best option for
the borrower.
Processing and Underwriting
A great LOS obviously incorporates
quality integrations that improve
the complete origination process,
from pre-qualification to closing.
However, all are not created
equal when decision makers
dig a little deeper. Learning how
the integrations process data to
increase efficiencies and cut costs
is an integral part of determining
the value of your new system.
The Ultimate Guide to Loan Origination Software 11
eClosing
Another modern time-saver that
borrowers appreciate and that just
about everyone on the business
side of a home sale benefits from is
eClosing—and the best avenue to
host eClosing functionality is your
LOS. Top-notch software either
hosts eClosing functionality or
includes integration partners that
offer all the data and documents
needed to proceed with closing.
Physical paperwork is greatly
reduced, the risk of human
error decreases, and loans are
completed (and borrowers are in
their new homes) in less time.
Comprehensive Reporting
and Analytics
Data is king in today’s mortgage
game, and a great LOS delivers
with features such as complete
audit trails, standard and custom
reports, and centralized reporting
from all parts of the pipeline. The
analysis capabilities from this
data help mortgage professionals
make strategic decisions both on
a case-by-case basis and from an
overarching point of view.
The Ultimate Guide to Loan Origination Software 12
Common LOS Integrations
Mortgage lenders and brokers
rely on a variety of third-party
service providers to expedite and
complete the loan origination
process. In the past, these
providers’ platforms existed apart
from the LOS, which slowed
down processing times and
reduced efficiency for mortgage
professionals and borrowers.
Integration that was possible
between platforms wasn’t
perfect—solutions didn’t play well
together, and users often still had
to exit one program and open
another to get the data or initiate
an action or report.
The modern LOS eliminates
platform-jumping and data
duplication by seamlessly
integrating third-party services
and functions directly into the
solution. Moreover, an outstanding
LOS has already been designed
to work with top vendors and
their solutions. Below are the
integrations your LOS
should include:
Appraisal services
Automated underwriting
Automated valuation model (AVM) reports
Bundled services
Closing documents
Credit reporting
Flood certification services
Fraud detection
Initial disclosures
Mortgage insurance interface
Product eligibility and pricing
Title/escrow services
Verification services
The Ultimate Guide to Loan Origination Software 13
An LOS with strong integration capabilities allows the user to check credit,
determine flood zone status, assess private mortgage insurance (PMI) cost, and
get the ball rolling on title and escrow—all without leaving the system. Such
functionality makes for a smoother mortgage process that ultimately frees up
lenders and brokers to serve more customers.
Your software should allow you to pull down a menu to choose an integrated service, giving access to any pertinent data within the system.
The Ultimate Guide to Loan Origination Software 14
Steps in the LOS Buying Process
With so many LOS solutions on the
market, it can be overwhelming
and confusing to navigate through
the options. The features and
integrations already described in
this guide must be considered, as
should your pain points and the
goals you have for your
next solution.
Realizing your mortgage business
needs a better LOS is the first step.
The next steps are to determine
which LOS is best for your
requirements and then select one
that meets those needs.
1. Identify who should be
involved in the selection
process
Many stakeholders may be
involved with the purchase of
an LOS. mortgage professionals
obviously should have a say, but
executives in charge of buying
decisions, IT personnel tasked with
implementing a new solution, and
compliance officers who might
need access to the software may
also bring important input to the
process. Form a committee and
work together to chart a path to
the next LOS.
The Ultimate Guide to Loan Origination Software 15
2. Determine the goals a new
LOS will achieve
This step is essential: What do
you want from your next LOS? Of
course, you want it to perform
better than your current software,
but what else do you want it to
accomplish? Consider these goals:
• Size of business
• Better customer experience
• Streamlined user experience
• Greater attention to compliance
• Remote functionality
• Paperless documentation
Assessing your system’s goals
goes a long way toward choosing
an LOS that makes sense for your
mortgage operation. For example,
if you prefer an on-premises
solution, a cloud-based LOS might
not make much sense. Similarly, if
you are originating just a few loans
a month, you may not need all the
luxuries of an advanced solution.
3. Determine the mortgage
department’s needs
Along the same lines, assess
what the people who will be
working directly with the LOS
need from it. The size of your
organization and complexity of
transactions are key indicators in
determining your department’s
needs. For instance, the ability for
multiple people to simultaneously
access the same application and
functionality on mobile devices.
Mortgage professionals may also
desire greater control over the
LOS in terms of customization and
configuration—which must
be accounted for when choosing
a solution.
Assessing your system’s goals goes a long way toward choosing an LOS that makes sense for your mortgage operation.
The Ultimate Guide to Loan Origination Software 16
4. Come up with a requirements
list and a scoring rubric
Talking about goals and needs
isn’t enough to enhance your
selection process. Write your
requirements down and rank them
in order of importance. A checklist
of your selection criteria ensures
that you’ve assessed everything
important to you in a potential
LOS. You can take this action a
step further by creating a scoring
rubric that gives a numerical value
to each item on your list. An LOS
with an impressive feature would
get a higher score than one that
is simply mediocre in that area.
The accumulated score offers an
additional method of evaluating
solutions.
5. Research vendors in the
LOS space
You can choose from plenty of
providers in the LOS space, all
offering platforms with features
unique to their respective
solutions. Take your time to
examine what each vendor has
to offer. Look for online reviews
and see what industry experts
think about various solutions. The
technical features of an LOS aren’t
the only consideration; what do
vendors offer in terms of customer
service and tech support? Talk to
other lenders and brokers in your
network about the software they
use and whether they are happy
with their provider. The more data
you can collect (both objective
and subjective), the better
equipped you’ll be to narrow
down your choices.
The Ultimate Guide to Loan Origination Software 17
6. Contact vendors that meet
your criteria
All your research has led you to
a small group of providers that
might have the LOS you need to
take you into the future. Now you
can contact them to learn more. It
may seem like an obvious piece of
advice, but it bears repeating: Ask
plenty of questions! With the list of
features and requirements you’ve
assembled, inquire about every
point, even if you know the answer.
You might get a sales pitch,
but you may also get advanced
answers that will help build your
confidence in the prospective
vendor.
7. Set up first round of
demonstrations
Hopefully, you’ll identify several
options that you will want to see
first-hand. Set up demonstrations
with these providers and challenge
them to show you why theirs is
the best LOS. Be sure the vendors
are thorough, and ensure each
provider is enthusiastic in their
pitch but also answering your
questions—if the presenter is
evasive when you ask a question
or want to see more, it may be
because a feature isn’t as robust
as you would like or doesn’t exist
(and the vendor knows it). Ask
to see mobile capabilities, and
put yourself in the minds of the
borrower: Will this solution be easy
for them to use and interact with?
The Ultimate Guide to Loan Origination Software 18
8. Narrow the list to 3
After seeing demonstrations from several providers, pick the top three to five
that impressed you the most and set up a second round of demos. Remember
your criteria from before? Ask the finalist providers to show you exactly how
their solutions address each criterion. Now is the time to explore every nook
and cranny of the LOS. You don’t want to discover after you’ve chosen and
implemented a solution that it lacks an important feature or functionality you
need. At this stage, also confirm pricing so you can calculate total cost of
ownership (TCO; more on this a little later).
Honestly assess how much a particular LOS improves upon the one you currently use.
9. Pick a vendor
With all the knowledge you’ve gained through your research, the final step is
picking a vendor from your final three. Review your criteria one more time and
determine which solution meets them the best. Honestly assess how much
a particular LOS improves upon the one you currently use. Also assess which
solution best fits into your budget. Your intuition should also play a role in your
decision—which LOS, based on the presentation and dedication, did you feel
most positive about? Take all these factors into account and pick a solution.
This seems like a lot of effort, but once you reach a decision, streamlined
processes, a better customer experience, greater efficiency, and an improved
bottom line await.
The Ultimate Guide to Loan Origination Software 19
Steps to Implementing Your LOS
The shiny new LOS that you carefully researched and purchased must be
implemented into your business and integrated with other systems. After
implementation, training will be necessary so you and your team can hit
the ground running with the software, processing loans faster and serving
customers better. Implementation can vary depending on your
organization’s needs.
Once you have signed the proposal, the implementation process can include:
Discovery:
The implementation team will
interview relevant stakeholders in
your business to understand the
current process and the desired
process by implementing
the software.
Setup:
The team will gather all required
information to configure the
software, such as all users—with
their roles, access, and licenses
identified—and all business
units’ locations and licensing
information. Depending on your
implementation, this information
may also collect software template
preferences, requirements
for training team members,
and credentials for third-party
integrations. This information will
allow the implementation team to
set up your LOS onsite or remotely.
The Ultimate Guide to Loan Origination Software 20
Testing:
For more complex installations, the
team will spend time building the
LOS to match your processes and
conducting end-to-end testing to
ensure a successful launch. During
this time, each team member is
properly trained and equipped with
additional training materials.
Launch:
The LOS provider guides your
team through the implementation
process, including a smooth
cutover to your new system.
Your organization should also
have access to post-live support
through phone and email.
The LOS provider guides your team through the implementation process, including a smooth cutover to your new system.
The Ultimate Guide to Loan Origination Software 21
Which Calyx Product Is Right for You?
With so many LOS options on the
market today, researching will
take time and expose you to a
wide range of solutions, features,
and philosophies. What many
lenders and brokers discover is
that an established provider with
a long history of supporting and
understanding the mortgage
industry is their best bet in
choosing an LOS that addresses
all their needs and all the needs of
their customers.
For more than 28 years, Calyx has
been at the forefront of improving
and revolutionizing the mortgage
process for lenders and brokers.
By working with the smartest,
most experienced minds in the
mortgage and tech industries,
we’ve streamlined, integrated, and
optimized all phases of the loan
process. Our products are like no
other in the industry—and so is
our reputation for serving
our customers.
For more than 27 years, Calyx has been at the forefront of improving and revolutionizing the mortgage process for lenders and brokers.
The Ultimate Guide to Loan Origination Software 22
Calyx Point (For Mortgage Brokers)
Designed for lenders and mortgage brokers, Point is the all-in-one LOS for
easier loan marketing, prequalification, origination, and processing. All the
features, forms, and reports necessary for a successful application are at your
fingertips. Highlights of Point include:
• Monthly SaaS pricing model: Software-as-a-service (SaaS) pricing keeps
operational overhead costs in check and offers a predictable expense for
budgeting and accounting purposes.
• Templates: Save time and ensure consistency with preconfigured information
via master files, loan programs, closing costs, data import/export, underwriting
conditions, and more.
• Prospect database and pipeline: Point users capture, create, and save pre-
application data for prequalifying prospective borrowers. The pipeline is more
efficiently managed this way, and prospect files can be easily converted to
borrower files before processing the loan.
• Marketing and sales tools: Applications such as rent-versus-own tools, open house
flyers, loan comparisons, and pre-approval letters strengthen relationships with
borrowers by providing advice and communication.
• Loan checklists: Improved file management allows users to track loan progress,
status, documents, and conditions.
• Configurable loan pipeline view: Customizing the pipeline column with the most
important information improves file processing productivity.
• Document management capabilities: These include streamlined document
storage, request, and exchange, as well as electronic signature functionality that
provides easy access to all loan-related documents within the file.
With Point, customized process meets streamlined ease of use so you can
focus on your work, not your software.
The Ultimate Guide to Loan Origination Software 23
Calyx Point Central (For Large Brokers or Small Financial Institutions)
Perfect for larger lenders, PointCentral pairs administrative control and top-
notch security in a single, centralized database. This solution lets staff work
on individual components of a single file while maintaining data integrity.
PointCentral includes all the features of Point and adds:
• Pre-built and customizable compliance rules: PointCentral comes with 31 rules,
customizable to your requirements, to ensure you meet federal
lending regulations.
• Anytime, anywhere access: Remote access to centralized loan data and templates
gives employees reliable access, regardless of location.
• Automatic file synchronization: Files are locked on the server when downloaded
and removed from the user’s local client when uploaded back to the server.
Quality, accuracy, and file integrity are maintained, even when multiple users have
access to the same files.
• Centralized reporting: Users can generate management reports that retrieve data
from the entire corporate pipeline, not just one location.
• Granular access rights: Craft flexible, granular rules that complement your business
practices and processes. Rights can be configured for multiple locations, users,
and user roles, thus decreasing the potential for errors with customized warnings
and compliance rules.
In one click, securely exchange data with hundreds of service providers. More
than 200 vendors are integrated into PointCentral via the Calyx Network,
providing product pricing and eligibility, closing documents, compliance
services, and more. PointCentral delivers everything a successful mortgage
business needs from an LOS: efficiency and ease of use along with advanced
controls and administration.
The Ultimate Guide to Loan Origination Software 24
Calyx Path (For Large Financial Institutions)
Path is Calyx’s mortgage processing innovation, taking a traditional LOS to
the cloud for increased speed, conversions, and customer satisfaction. Path
digitizes the entire loan origination process, thus offering unprecedented
efficiency for mortgage professionals and borrowers.
Features of our two Path products, Path Retail and Path Enterprise, include:
• Fast launch: Between our cloud- and data-based solution and our account team
dedicated to your success, you can have Path up and running—and realize a faster
ROI—in as few 21 days, the quickest launch frame in the industry.
• Virtual desks: Mortgage professionals can use Path to complete tasks and convert
leads to loans from their computers or their mobile devices.
• Predefined roles: Path users maintain complete control of workflows, and team
members can complete tasks anywhere.
• Zip: Borrowers love the convenience and ease of Zip, Path’s mobile-friendly loan
interview and automated data transfer application..
• Automated pricing engine: Embedded into Path, this feature manages eligibility
and loan locking and helps reduce errors and increase efficiencies.
• eClosings: Focus on people, not paperwork. Path partners with best-in-class
document providers for 100 percent paperless, digital eClosings.
• Enterprise: Path Enterprise offers a fully configurable LOS with three channels
operational on a single platform. This comprehensive solution is designed to
be configured specifically for each lender’s operational structure and business
channel workflows.
The Ultimate Guide to Loan Origination Software 25
More Than Just Software
A Calyx LOS delivers unparalleled
functionality, innovation, and
results. But the excellence doesn’t
stop with the software. Calyx
provides outstanding customer
service and resources for lenders
and brokers that trust their
mortgage businesses with our
solutions. Among the things we
offer our customers:
Customer support via phone
and email
Training webinars and videos
A comprehensive Knowledge
Base offering self-service
help such as user guides,
product release notes, video
tutorials, and more
Professional services and
customized online or on-site
training from senior-level
mortgage and technical
professionals
When you adopt a Calyx solution,
you aren’t just contracting a
vendor—you’re enlisting a partner
that will be there through thick and
thin to help you get the most from
your LOS. You and your customers
deserve no less.
A Calyx LOS delivers unparalleled functionality, innovation, and results. But the excellence doesn’t stop with the software.
Today’s mortgage lenders and brokers face challenges—from federal regulators,
from the evolving and tighter marketplace, and from borrowers that demand
convenience and excellence. You need an LOS that meets and conquers these
challenges. Calyx Software offers a variety of solutions to fit your needs.
Request a Demo of Point or PointCentral
Request a Demo of Path
Calyx Software
800-362-2599
1. Marte, Jonnelle. “Non-Bank Lenders Are Back and Even Bigger than Before.” The Washington Post, WP Company, 21 Sept. 2018, www.
washingtonpost.com/business/economy/non-bank-lenders-are-back-and-even-bigger-than-before/2018/09/21/5fc026a2-bc48-11e8-8792-
78719177250f_story.html?utm_term=.748f18eaca9f.
2. ABA Banking Journal. “CFPB Issues Analyses of Qualified Mortgage Rule.” ABA Banking Journal, 11 Jan. 2019, bankingjournal.aba.com/2019/01/
cfpb-issues-analyses-of-qualified-mortgage-rule/.