Loan and mortgage processing requires a huge amount of data handling. Data which is sensitive in nature and requires to be scrutinised thoroughly before the loan is funded by lenders.
Mortgage processing is a complicated process. From the stage of loan origination till settlement and closure multiple documents cross hands, there are varied information requests from submitted documents or the need for a new set of documents
Traditionally document stacking was referred to the order in which loan documents, submitted by the applicant, are stored in a legal-sized folder. Documents were stored in a specific sequence, making it easier for the loan processor to search for a document in case if he required to refer to a document. With the advent of computers, though digitization has taken place the sequence or ‘stacking’ remains the same.
Federal authorities provide file stacking order checklists e.g. USDA provides a checklist for the sequence in which a set of documents has to be submitted. Just by surfing through the sections of the checklist, it is enough to understand the importance of stacking. The sequence makes it obvious. The checklist is divided into three main parts as follows: Of course, the checklist changes depending on the type of loan applied for.
It makes one wonder, in today’s world of information technology why is there a need for stacking at all? Just number the files as per the checklist and submit the docket for processing.
Loan applications can run into multiple pages. The documents submitted are sourced from various sources like bank statements, salary slips, asset reports, income proofs etc. From an applicant’s perspective, they are important as it portrays his eligibility to avail a loan. But from a lender’s perspective, the need to understand the ability of repayment is crucial – and documents are the only medium which can help a lender about this.
Additionally, documents required vary from state to state and also the county. Furthermore, there are documents which are scanned images of physical documents. This makes document stacking and indexing all the more challenging.
A simple one-page document which is missing or misread can derail a complete loan process affecting the goodwill and market standing.
Manual process of stacking and indexing is time consuming and not an efficient/effective way. The best way forward to solve the challenges of document stacking and indexing is OCR. OCR which stands for Optical Character Recognition is a technology which converts handwritten or printed text into a machine-readable format. OCR is widely replacing manual data entry.
Furthermore, adding Machine learning (ML) to OCR, one has a potent solution which can completely automate the stacking and indexing process of a mortgage service provider, enabling:
DocEaze is a document management platform powered by ML and OCR developed specifically to automate the process of Indexing and Stacking across the Loan Processing life cycle. Developed by professionals with decades of industry experience from Avanze Global, it efficiently addresses the challenges of document management. An easy to use and scalable solution, DocEaze is a tool which can introduce your business to a new orbit of success.