Today's low‑volume, purchase‑focused market is more competitive than ever, as mortgage lenders work to win more market share than their neighbor and aim to be as profitable as possible. Compressed margins make it crucial to work as quickly and efficiently as they can, taking every opportunity to reduce costs and maximize every basis point of margin. Selecting the right product and pricing engine (PPE) will help lenders achieve these goals.
Industry veteran Parvesh Sahi, chief revenue officer at Polly, has spent much of his career in the mortgage space, working with notable fintech vendors and facilitating powerful connections between compliance and loan origination softwares. During his decade‑long tenure at ICE Mortgage Technology, Sahi learned the importance of bi‑directional communication between software applications to achieve optimal workflow efficiencies, user experience and maximize profitability.
According to Sahi, there are three primary components that will help lenders succeed in today's mortgage environment, and beyond: speed to market, margin management and loan officer experience and education.
"If you're not focused on creating that connective tissue between the three, you're missing an enormous opportunity," Sahi explained.
Identifying the right PPE
With that said, what should lenders look for in their PPE?
First, the PPE should be architecturally designed to accommodate any lenders' unique business strategy or use case. It should have native cloud capabilities and be web‑based so the system can flex up and down with the market and enable speed of feature consumption and development. It should be purpose‑built on the most advanced infrastructure to handle any amount of volume without having to sacrifice speed, performance or the user experience.
The ideal PPE is designed to evolve and scale, with the ability to add new features and functions at a lightning‑fast pace. Lenders are no longer left waiting through long release cycles (historically upwards of 6‑18 months on legacy solutions) for functionality or reliant on custom‑built solutions to get the features and workflows they desire. PPE providers need to provide a commercially scalable platform that is agile and more competitive – today. It should also support users' ability to deploy new loan products quickly as their strategies change.
Another thing to note when identifying the right PPE is the technology partner. The right tech partner will provide a PPE that enables you to accomplish all the above, and will also help position your organization for ongoing success via constant and consistent innovation that keeps the lender customer at the center of the equation.
Lenders also need to optimize their secondary market interaction in terms of selling loans and finding best execution pathways, Sahi said.
"[The PPE] does not sit alone, but rather within this origination and buy‑side ecosystem," he said. "If you do not have a system that was architected with uniform, normalized data across originations and secondary market trades, you may find yourself at a competitive disadvantage in terms of price optimization and best execution, both in the short term and even more so long term."
In pioneering the new gold standard for PPEs, Polly purpose‑built their engine in the cloud and for the cloud with a mobile capacity and API‑adjacent product strategy in mind.
"Polly has revolutionized the mortgage capital markets space with process transformation we haven't experienced in this industry segment for 20+ years," Sahi said. "Polly is the new market entrant, and we have already surpassed every other PPE out there in terms of technology, functional depth and APIs that deliver speed and next‑level flexibility."
The company is committed to adding demonstrable value across the entire mortgage value chain, and continues to expand its network of third‑party tech partners as well. Many best‑in‑class providers have proactively engaged Polly to join in their quest to solve industry pain and augment lender efficiencies.
How the right tech can help LOs and borrowers
The right PPE will help loan officers work more efficiently and effectively.
With a smaller amount of loans up for grabs, LOs need to ensure they are maximizing profitability per loan while solving price‑conscious borrowers' needs. Additionally, LOs need to be educated so they can educate their customers on additional options that may help solve their financial needs. The core limitations of legacy solutions make this impossible. What's needed is a cloud‑native, up‑to‑the‑minute PPE that enables LOs to truly optimize margins and revenue on every loan both inside the PPE UI, as well as in other LO applications.
The right PPE will interoperate seamlessly with a lender's front‑end applications. Many LOs also work remotely via mobile technology and need the ability to log into a web‑based user interface to price on the go.
"When you look at modern technology that was built with the perspective of APIs [being] an important part of this workflow, it's not an afterthought," Sahi explained. "The mobile interaction that LOs need in the field to better engage their borrower operates with speed and is already part of that solid foundation."
Sahi also notes that while other legacy PPEs have circled back after the fact to make their applications work on the go, re‑architecture is not a great execution path. A flip phone will make a call, but you cannot pull it apart, put it back together and expect it to be a smartphone.
Using the right PPE will also benefit the end borrower by making it easier for lenders to support affordable housing programs.
If a lender is working in a legacy PPE system that requires manual processes to make updates to affordable lending, it may be too difficult to roll out these types of products.
"They essentially give up on those loan programs, oftentimes due to the sheer complication of new product deployment in other systems. There may also be an underlying concern that even if they do make those specific changes, they could roll out in a non‑profitable or non‑competitive way and cause more damage than benefit," Sahi said. "The unfortunate reality is that some lenders do miss out on those affordable loan opportunities because their PPE cannot adequately support or execute that rollout."
On the flip side, when lenders adopt the most technologically advanced solutions, they are able to make updates on the fly with an infinite amount of flexibility around loan parameters and margins. They can confidently ship affordable loan products out to their borrowers much more easily.
Along came Polly
Since bringing the first and only truly cloud‑native PPE to the industry in 2019, Polly has ushered in a new wave of innovation and functional depth that is enabling lenders nationwide to turn their secondary and capital markets function into a high‑performing profit center.
Aside from the company's robust configuration capabilities and cutting‑edge infrastructure, Polly is known for their pace of innovation and product roadmap execution at a commercially scalable level. Another pillar to their success centers on the company's hyper focus on customer success.
"At Polly, we view the relationship between vendor and lender from a different lens; the lender is our customer. Polly is the vendor to the customer, and we are going to do anything and everything to make that customer successful."
This customer‑centric paradigm shift drives behavior in a different way, not only in terms of how Polly engages with the lender on day one from a sales perspective, but more importantly – in terms of the ongoing support and value creation that Polly delivers.
"As a company, we are not standing still," Sahi concluded. "This is only the beginning."
To learn more about how Polly is revolutionizing mortgage capital markets, visit polly.io.