
COVID-19: Implications and next steps for mortgage lenders
April 22, 2020
April 22, 2020
Consumer households are already facing financial hardship as a result of the coronavirus outbreak. Millions are now experiencing the realities of unemployment and millions more are likely to in the coming months. While some of these consumers will receive relief in the form of unemployment insurance, in most cases it will not be enough to cover basic living expenses plus mortgage payments.
The impact of COVID-19 and the intervention of the government will have far-reaching implications for loan servicers. We see this happening in three overlapping waves:
Responding to these challenges will be a defining moment for lenders and will have major brand implications. Our recommended actions include:
The pandemic is likely to accelerate the adoption of digital capabilities across the industry. Many consumers will engage with digital tools and virtual experiences that they would otherwise have avoided. Lenders will become comfortable with a remote workforce and begin using collaborative tools that make interactions with customers and fellow employees more seamless. For these reasons, actions should be taken with one eye on the future. Don’t just think of how a solution solves a short-term problem. Rather, think strategically about how solutions might fit within your organization in the longer term.
Across mortgage origination and loan servicing, lenders should take immediate action to address challenges that have already been realized, and to get in front of those we know are coming. You should consider the following actions now to successfully navigate the waves that are coming: