Should You Partner with an LOS Company or Build Your LOS?
When a company recognizes the need to implement new or better loan capabilities for customers or borrowers, one of the first questions to address is, “What are our lending options?” It is essential to rely on a loan origination system or LOS that matches current demands and expectations like:
- Automated processes
- Origination speeds
- Process simplicity
- User-friendly experiences for the lender and borrower
Third-Party LOS vs. In-House LOS
There are two paths a company can take to implement a loan origination system: partner with a third-party LOS vendor or build an LOS internally.
When weighing your options, consider these three crucial factors:
You may consider an in-house LOS if your company has an IT department skilled enough to build and update it while maintaining other operations like security monitoring, server management, or network maintenance. However, while qualified IT employees may comprehensively understand system creation, they may lack expertise in LOS-specific requirements or intricacies.
Companies with smaller IT departments are more likely to consider partnering with an LOS company whose sole focus is loan origination and all that it entails. In many cases, implementing a third-party LOS is a cost-effective, time-saving solution regardless of your IT department’s size or ability.
LOS Creation or Implementation Timelines
LOS creation is a challenging project to complete, no matter how skilled your development team is. The process of building an LOS requires time and resources, plus it requires additional time and labor to study regulation updates and ensure your LOS remains compliant.
A trusted LOS vendor has experience implementing their product(s) at numerous other companies or institutions. Through a third-party partnership, you can expedite the process and introduce the LOS to your employees and borrowers much faster than you could with an internal build.
State and Federal Compliance Requirements
Your LOS solution must meet current state and federal requirements, regulations, and industry standards. State and federal regulations frequently change, which means the team that internally builds an LOS must stay abreast of these changes and update the system often. Several regulators monitor lenders and their processes, making compliance a crucial factor to consider.
A third-party LOS vendor can simplify the compliance factor by carefully following regulation changes and updating solutions accordingly. Companies and institutions find it much easier to comply with regulators when they choose to partner with a quality LOS vendor.
If you are interested in an LOS that is expertly created, easily implemented, and always compliant, you need absVision from Allied Business Systems.
absVision is a robust, easy-to-use loan origination and management system designed by a team who understands our lenders’ needs. Call us today for more information: 800-727-7534