Magazine article Mortgage Banking

Prioritizing Technology Initiatives Critical for Firms in 2007

Magazine article Mortgage Banking

Prioritizing Technology Initiatives Critical for Firms in 2007

Article excerpt

Expect the top challenges for U.S. mortgage and consumer lenders in 2007 to include grappling with increased market volatility, changing customer and marketplace demands, and overcoming the legacy of paper-based and manual processes, according to a report by Needham, Massachusetts-based TowerGroup.

TowerGroup's report, Consumer Lending's Top 10 for 2007: Business Drivers, Strategic Responses and Technology Priorities, noted that the untroubled days of consumer financing are nearly over following two years of Federal Reserve rate hikes.

In order for consumer lenders to compete effectively in the year to come, the TowerGroup report concluded, it is critical they put more emphasis on the customer as well as on the revenue side of the income statement.

"Prioritizing technology initiatives will be more critical than ever in 2007, given the need for lenders to drive revenue as lending volumes decline--as well as to invest a greater percentage of IT [information technology] spending on loan servicing, collections and compliance," said Bobbie Britting, a senior analyst in the TowerGroup Consumer Lending practice. "TowerGroup believes the top IT priorities for lenders in 2007 will include better leveraging back-office processing systems by transforming legacy IT platforms, eliminating redundant systems and integrating subsystems for content management and compliance."

The TowerGroup report outlines the top-three consumer lending drivers for 2007:

* Market volatility: U. …

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