SA’s property industry is rapidly expanding into previously underserved rural and township areas, creating as it does many lucrative entrepreneurial opportunities - in construction, for example, in real estate and also in mortgage origination.

And the entry of new players into the mortgage origination field is being facilitated to a large degree by the BondTrak solution designed and supplied by mortgage software specialist IT company Comcorp.

Marcel Zeier, Comcorp CEO Mortgage Software says: “Ostensibly, mortgage origination has low barriers to entry and offers significant returns on initial investment in a very short time. However, in order to be accredited, an originator must be able to add value by offering advice and choice to the consumer, and by digitising the loan application and supporting documents for processing by the banks.

“It is this latter function that cuts the costs of loan acquisition for the banks and creates margin, which is where the originator’s commission comes from. And it is this cost saving function to Banks that is enabled and enhanced by BondTrak.”

Download the full press release

The mortgage origination industry has come a very long way in the past four years – not least in its application of technology to simplify and speed up the processing of home loan applications.

And nowhere is this more evident than in the communication between the originators and the banks. These days, 70 percent of all new home loan applications are generated via the mortgage originators, and 97 percent of these applications take place electronically, using a single online platform that was especially designed and developed at a cost of some R25m.

Says Richard Moss, MD of Comcorp, the specialist IT company that created the platform: “Back in 2003, only a small percentage of the communications between originators and banks were taking place electronically. By far the majority were still via phone and fax.

“There was thus the potential for massive time and cost savings - if we could create an online communications platform that could connect any originator to any or all of the major banks, much like the universal Saswitch platform that all the banks use and all their ATMs are plugged into.

“There was also a huge need for such a system because with the rapid growth in origination and the boom in the property market, the number of bond applications was rising exponentially and the bank home loan departments were being swamped with paper.

“Indeed, it is questionable whether the industry could today function without the platform, which at the current rate of business is processing over 100 000 electronic home loan applications per month, generating 140 000 supporting documents a day – or the equivalent of 17 000 old-fashioned faxes per hour.”

In monetary terms, R50bn a month or more than R5m worth of home loan applications per minute are processed, validated and routed through the Comcorp mortgage switch, which enables mortgage originators to submit electronic loan applications to any of the major banks in each bank’s specified format.

The system integrates all the source documentation required by the lending departments of the four major banks, digitizes it, validates it, and offers live replies via decision templates – all through a framework that is compliant with both FICA and the National Credit Act and thus gives the banks peace of mind.
 
Originators opting to use the switch are provided with intensive training that enables them to have their business fully operational within a week. Supporting software covers everything from business rules and data validation to disaster recovery strategies. It is further supported by an online call logging system, and a full support team.

Comcorp’s mortgage switch has successfully processed 2m home loan applications valued at a total of R900bn to date.

System Delivers Over R50-billion Worth of Applications for Month of May

The fax is dead. The swing towards electronic home loan origination is now really gaining momentum, with originators submitting R52-billion Rands worth of home loan finance applications in May alone via Comcorp's mortgage Switch. Statistics year-to-date reflect originators using the Internet-based Comcorp Online system to have made R 150-billion worth of home loan applications in the past three months, compared to R120-billion worth in the previous three months.

Home Loan application volumes exceeded 100 000 through the Switch in May, bringing the total since January to 500 000 applications, of which Rich Moss, Comcorp's Managing Director said, "97% were processed electronically, by banks with fully-automated “back offices” linked to the system. The faxed application along with all it’s inefficiencies, costs, inaccuracies and time delays has been made extinct."

The Comcorp Online transaction management platform is designed to enable banks, mortgage originators, estate agents and attorneys all to interact via the Internet, and is currently used by all major home loan banks as well as over six hundred origination companies.
 

And now with the advent of SmartDoc, we expect to eliminate a further 130 000 of friction filled fax pages of supporting documents per day out of the process says Moss.

Originators will grow share of new home loans:

Originators have become market makers. Highly motivated, commission driven, and armed with multiple bank products, mortgage originators are eager to do deals. These market makers are growing the already buoyant property market through their ability to increase the pool of business concluded through their skills of motivating purchases to conclude business, as well as increasing the closure ratio of deals concluded because of their tenacity. Originators are able to dispense advice and provide applicants with an increased scope of banks and product choice.

As more and more home loan information becomes available online, enabling consumers to compare products and rates for themselves, mortgage originators will increasingly need to add value by providing advice as well as multi-lender platforms to facilitate product comparisons in order to optimize matching customers with loans.

First-time buyers, especially, will turn to originators for advice on the type of loan to suit their particular circumstances and , information regarding local lending market conditions.

Agents requiring speedy finance will support commission driven mortgage consultants supported by digital applications and electronic feedback.

Approval in principal and formal grants have changed into a Quote under the National Credit Act. All bank status updates on applications submitted electronically are available as “live replies” via the Comcorp Switch. Delivering status updates to bond consultants, estate agents and buyers will no longer deliver competitive advantage, as live replies are expected to keep stakeholders informed on deals.

And like attorneys, originators will need to be “plugged in” to a system in which a transaction initiated by the estate agent, a buyer or origination consultant can be managed, processed and finalized, entirely online.

Comcorp anticipate mortgage brokers will originate up-to eighty percent of new home loan business within the next two years.

We are glad to announce that you can submit again to the following banks with full NCA compliance:

• ABSA
• First National Bank
• Nedbank
• Standard Bank

Leading Mortgage software provider Comcorp Online manages the industry Mortgage Switch for ABSA, First National Bank, Nedbank and Standard Bank. Comcorp have pioneered mortgage software for the origination industry over the past five years, investing R 25 Million to date. Having concluded contracts with each of the major banks, Comcorp provide an outsourcing service to supply complete, validated, electronic mortgage applications via this switch from the country’s leading mortgage originators.

Comcorp Director, Paul Moss says, “The switch enables users of Comcorp’s BondTrak software as well as other software vendors to submit electronic loan applications to any of the major banks in a format acceptable to each bank. The switch provides vendors with one technical specification that integrates into all the banks. Comcorp also offer a number of value added technical services around the switch as well as ongoing maintenance of the bank interfaces and technical support to the vendors. The key benefit of the switch is that it reduces complexity by allowing a vendor to focus on developing proprietary software. The switch also provides electronic status updates and automated decisions from the banks. Comcorp believe this is just the beginning of a long and exciting road in which the industry will ultimately totally automate the mortgage process, and we intend to play a leading role in achieving this.”

Comcorp Online MD, Richard Moss, says Comcorp will still continue to provide their existing mortgage software service to originators. “BondTrak® software, installed by Comcorp with ongoing in house training and support, enables mortgage originators to submit mortgage applications electronically, receive automated decisions and status updates from the banks and use the powerful BizTrak® MIS tool, thus providing a state of the art real time service to originator, agency and applicant. The system, pioneered by ourselves, has been developed over the past seven years and over 2,000,000 successful applications have been processed. During this period we have seen daily volumes grow to over 4, 500 applications valued at R2,4 Billion per day.”

 “We are committed to our clients’ success and will continue our focus by providing them with cost effective, cutting edge, mortgage origination software at a reasonable cost.” says Moss.