MBA Releases Its First Commercial Technology Survey

September 1, 2005

Washington, D.C. – The Mortgage Bankers Association (MBA) released the findings of its Commercial Technology Survey – the first time it has undertaken a comprehensive study of the use of information technology in the commercial and multifamily mortgage industry. MBA’s Commercial Real Estate/Multifamily Finance Board of Governors’ (COMBOG) Technology Initiatives Committee was responsible for developing the survey, aimed at establishing an industry baseline to measure the degree to which specific information and its correlated mortgage processes and functions are computer-based. The survey enjoyed strong industry participation, with originator and lender respondents responsible for roughly $70 billion in 2004 loan originations and servicer respondents for more than 130,000 loans with an aggregate unpaid principal balance of $525 billion. The survey is the first in a series of studies by MBA on the industry’s use of technology.

The use of electronic channels to transmit loan information offers a number of potential benefits to the industry – increased efficiency, reduced processing time, and decreased expenses for the storage and shipment of paper. The results of the survey show what technological leaps industry professionals have already taken and in what areas electronic usage is still lagging. The survey is comprised of one general set of questions for all participants and three sector-specific sets of questions – one for originators, one for lenders and one for servicers.

“MBA’s survey is the first of its kind to provide a comprehensive industry assessment of the degree to which processes and reporting is automated across the entire commercial real estate finance chain, at each stage of information-sharing and by function. This survey represents an important first step in evaluating the industry’s ability to adopt commercial industry technology standards, including those released by MISMO. These standards are directed at reducing expenses, eliminating duplicative manual data input, increasing reporting accuracy and information transparency and boosting investor confidence in commercial real estate finance investments as an asset class,” said Catherine J. Rodewald, managing director of Prudential Mortgage Capital Company and chair of COMBOG’s Technology Initiatives Committee.

  • Survey result highlights include:
  • More than three-fourths of survey participants have started efforts to store electronic images of loan documents;
  • Nearly two-thirds of the loan proposals sent from originators to lenders were submitted in electronic format;
  • More than half of loan underwriting packages received by lenders were received in electronic
    Servicer responses globally indicated a high usage of electronic communications and that larger servicers are generally more electronic than smaller servicers;
  • Investor reporting and remittances are nearly entirely electronic; and
  • Processing property inspections is largely electronic.

Overall, nearly 90 percent of survey participants assessed their firm’s receptiveness towards planning new technology initiatives as “Strong” and 78 percent have launched electronic document imaging efforts. Survey participants were unanimous in the sentiment that initiatives to exchange data electronically with their trading partners were not intrusive to business practices. “Since the beginning of MBA's emphasis on technology issues, we hoped industry professionals would begin to embrace e-commerce,” said Bill Frazer, managing director and chief financial officer of L.J. Melody & Company, current vice-chair and former chair of COMBOG’s Technology Initiatives Committee. “This survey clearly shows that the industry is heading in the right direction.”

To view the MBA 2005 Commercial Technology Survey, click here.

Source: MBA

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