a la mode debuts Mortgage XSites as survey shows lenders could speed appraisal turnaround times

Highlights:

• 40.3 percent of appraisers report that 80 percent or more of their appraisal orders still come in via phone or fax
• Half of appraisers report that 75 percent or more of their clients' assignment status checks are still via phone or fax
• The number of appraisers embracing electronic ordering and report delivery has doubled in five years, but lenders significantly lag, especially in electronic ordering
• a la mode, which EDI-enabled appraisers in 1997, now offers lender-side tools for faster, high-quality appraisals such as the Mercury Network and the new Mortgage XSites

PHOENIX, AZ — From the floor of the Mortgage Bankers Association's National Technology in Mortgage Banking Conference & Expo here, a la mode debuted a "sneak peek" at its latest lender-side solution to closing loans faster: Mortgage XSites. Mortgage XSites allow brokers, loan officers and other lender representatives to quickly set up and easily maintain a website loaded with rich content and features, geared toward getting business from home buyers and refinancers.

In addition, Mortgage XSites will allow users to seamlessly interface with EDI-capable appraisers, whether among a la mode's 51,000-plus appraiser customers or otherwise. Appraisers ready and able to import appraisal order details, complete assignments and deliver complete, error-free electronic appraisal reports faster and more efficiently.

A recent survey shows that the Mortgage XSites solution can significantly streamline the appraisal process. Mortgage lenders who order and receive appraisal reports lag their appraisers in the adoption of time-saving technology and business practices, a March, 2004 survey of more than 1,250 appraisers revealed.

The appraisal process could be made more efficient, more productive and faster if appraisers' clients adopted electronic ordering, online and e-mail assignment status checks, and electronic format reports in lieu of faxed or delivered hard copies. Their appraisers are ready, but as one appraiser said, "banks have got to catch up."

a la mode, inc., North America's largest provider of software and workflow solutions to appraisers, invited its more than 51,000 appraiser customers to participate in an online survey about how much of their business is done electronically. The survey also measured appraisers' adoption of EDI – the ability to receive electronic orders, respond to electronic follow-ups and provide .PDF or other electronic-format final reports – in the last five years.

Appraisers ahead of the lender curve

Appraisers have overwhelmingly embraced electronic ordering, status updating and delivery of reports, but relatively few of their clients are willing or able to join them on the "fast track," especially on the front end, the data showed.

"The results clearly show that appraisers are capable of delivering faster, more reliable appraisals. But too many of their clients can't or won't do business with them in the most efficient way," Scott Kinnaird, vice president of business development with a la mode, said. "If more lenders took advantage of readily-available tools to streamline appraisal ordering and statusing, the process would be more efficient, and more loans would get closed, faster."

a la mode, which brought EDI technology to appraisers in 1997, has made it possible for appraisers to provide the quickest turnaround of reliable appraisals. Fifty-two percent of a la mode customers completing the survey said they had the capability to receive electronic orders five years ago, and 98 percent say they can now. Five years ago, 45 percent of surveyed appraisers were capable for producing electronic appraisal reports – Adobe .PDF or other electronic format – while an identical 98 percent say they are now.

To help appraisers and their lender clients work more efficiently together, a la mode launched the Mercury Network in 2001. The Mercury Network allows lenders to find EDI-capable appraisers, order reports electronically and receive complete, E&O-checked paperless appraisals in industry standard .PDF format. The Network delivered more than 16.5 million appraisal reports in calendar year 2003.

The Mercury Network now allows its more than 27,000 lender-side users to order appraisals by inputting basic information about the subject property and assignment parameters. The order is sent to a Mercury-enabled appraiser, who downloads the order and all associated information directly into the appraisal formfilling software of the appraiser's (or client's) choice.

Updates on outstanding appraisal assignments are crucial. So Mercury e-mails and faxes a detailed status summary of all a lender's orders first thing each morning. A current "snapshot" of the assignment, updated as the work is completed by the appraiser, is accessible online 24 hours a day.

The ordering/follow-up bottleneck

The Mercury Network and Mortgage XSites solve an important problem not often recognized in the mortgage lending industry. In the a la mode appraiser survey, half of the more than 1,250 appraiser respondents revealed that fewer than 35 percent of their orders come in via e-mail or other electronic method today. (The median response to the question, "What percentage of your orders are sent to you electronically (via e-mail, or via Internet or other online methods) now?" was 35 percent in the survey with 1,253 responses.) But more than 98 percent reported that they are capable of receiving electronic reports.

Similarly, half the appraisers who completed the survey reported that three quarters or more of their clients' follow-up "calls" are just that – phone calls or faxes, rather than sent by e-mail or other electronic means. (The median response to the question, "What percentage of your clients' follow-ups/status checks on an order are sent to you electronically (via e-mail, or via Internet or other online methods) now?" was 25 percent with 1,253 responses.)

"Since 2000, I do not do anything on the telephone," Jim Hunter, an 18-year veteran appraiser from Bakersfield, Calif., said. "I won't play phone tag, I hang up when I'm put on hold, I won't be interrupted. Haste makes waste.

"If a lender takes time to send a proper request, I'll respond. If they call, I erase phone messages without even listening to them," Hunter said. "Does this hurt my business? No, because I'm not spinning my wheels needlessly. And I'm delivering my appraisals on time. As a consequence, I get phenomenal repeat business."

Paperless reports are mainstream, but not paperless orders

Some good news for lenders: .PDF and other electronic format reports have caught on. Ninety-eight percent of a la mode appraisers reported having the capability to send reports in electronic format. And half of those reported that 95 percent or more of their appraisals today are sent electronically.

Still, nearly 12 percent (11.57%) of appraiser respondents reporting being able to produce electronic reports said that half or more of the reports they transmit to clients are hardcopies.

And even though many appraisal clients are receiving electronic reports, they still insist on faxing or phoning orders. In five years, the number of appraisers reporting they were able to receive electronic orders nearly doubled, from 51.8 percent in 1999 to 98.3 percent today. Five years ago, more than one-third of appraisers (34.4 percent) who reported being capable of receiving e-mail or other electronic orders said they had no lender clients who took advantage.

Today, more than four in ten – 40.3 percent – of appraisers capable of receiving orders electronically said that 80 percent or more of their orders are still coming in via phone and fax. (1,232 respondents said they are capable of receiving electronic orders; of those, 497 said the answer to the question, "What percentage of your orders are sent to you electronically (via e-mail, or via Internet or other online methods) now?" was 20 percent or less.)

"The local banks have not yet modernized to e-mail," Opie G. Boyer, of Opie G. Boyer, Jr. Appraisal Service in Huntington, Pa., said. "They can spend hundreds of thousands building new branches but not a penny on e-mail.

"Maybe we should charge $50 more for paper appraisals," he suggested. "The banks have got to catch up."

Mercury Network and Mortgage XSites represent the best solutions

"We've found in our experience that the hardest step to take is the first one," Dave Biggers, founder and CEO of privately-held a la mode, said. "So with our recent Mercury 3.0 release, we revolutionized the Mercury Network to allow lenders who still order via fax and e-mail to manage their appraisal projects through the Network." Biggers said that rather than "fighting" with lenders that still prefer to do business the way they've always done, his company made it so the Mercury Network would accommodate whatever way they wanted to do business – on the theory that "once they dip their toes in the water of online ordering and statusing, they will eventually catch up to their appraisers" on the Network.

"And we've included so many intuitive, valuable new features that the Mercury Network is more accessible and useful than ever before," Biggers added.

Similarly, Mortgage XSites are drastically easy and intuitive to set up "wizard" style. Like the company's Appraiser XSites and Agent XSites for Realtors®, in 15 minutes mortgage brokers and lenders can set up a Flash-enabled, content-rich website packed with information and tools for prospective borrowers.

"Mortgage XSites are so easy to set up and maintain that once mortgage professionals do so, they will become comfortable with the robust document and settlement service management features included," said Dave Affleck, project manager for Mortgage XSites.

"Appraisers are naturally skeptical, and they had to ‘hold something in their hands' and be able to see its benefits before changing the way they did business," Affleck said. "We did change the way they do business. Now we want to do the same on the mortgage side, with the same benefits.

"That's the value of Mortgage XSites – they get a professional, feature-rich web marketing tool, and the capability to do business not only with their borrowers but their contractors, like appraisers, far more easily and efficiently." Professional, high-quality appraisals are turned around faster and loans close more quickly, Affleck said.

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About a la mode

Founded in 1985, a la mode develops desktop tools, mobile tools, web sites for real estate professionals, mortgage brokers, and appraisers. a la mode's flagship product, WinTOTAL form-filling software for appraisers leads the residential appraisal industry. a la mode's Mercury Network, a vendor management platform for lenders, provides the most experienced local appraisers in an HVCC-compliant, easy-to-use loan ordering and management application. a la mode's mission-critical products are used by hundreds of thousands of appraisers, agents, inspectors, and lending professionals to complete the nation's real estate transactions. The company's state-of-the-art offices are located in Salt Lake City, Oklahoma City, and Washington, DC. To learn more, visit www.alamode.com.