What 30 Years in Mortgage Lending Taught Me About Operations Software

I got my start as a fixed income analyst at Citicorp. In 1992 I founded a mortgage bank in Manhattan, and at 26 I was the youngest mortgage banker New York State had ever licensed. We grew into a national lender, licensed in 27 states and the District of Columbia, with more than a billion dollars in loan volume. Later I worked inside fintech lenders, at SoFi, Earnest, Renew Financial and RenoFi, and co-founded Hitch, a home equity platform.

That's more than thirty years of watching loans move through systems. Here is what stuck.

The loan is never the hard part

Pricing a loan, underwriting it, closing it: the industry has mature tools for all of that. What breaks is everything around the loan. The handoff from the loan officer to processing. The condition that sits in someone's inbox. The document a borrower sent three times because nobody could find the first two. Every lender I have run or worked with lost more time in the handoffs than in the work itself.

Every state is its own business

When you are licensed in 27 states, you learn fast that there is no such thing as one process. Disclosures, forms, timelines and rules change at the state line. Software that assumes one standard way of doing things pushes all of that variation onto people, and people handle it with spreadsheets and memory. That works until the person who remembers goes on vacation.

Volume hides waste, and slow markets expose it

When rates drop and the phones ring, nobody looks at the workarounds. There is too much business to stop and fix anything. When the market turns, the same workarounds are still there, but now they eat your margin. The best time to fix operations is before you need to, and almost nobody does it then.

Fintech didn't remove the work, it moved it

At the fintech companies I saw beautiful front ends sitting on top of a lot of manual work. The borrower saw a clean app. Behind it, operations teams were still reconciling, re-keying and chasing. The lesson wasn't that technology failed. It was that the technology was built for the customer screen and not for the people doing the work behind it.

What I build now

That is why I started building made-to-measure software through Millwright Logic. Our HomeBase platform began as a system I built and customized for a public manufactured housing company, where it runs under the name TurnKey. It doesn't replace the loan system, the document platform or the property software. It connects them and fills in the steps that used to be done by hand.

The idea is the same one a good tailor works from. You measure how the business actually runs, you cut to fit, and you adjust until people stop noticing the tool because it just works. Buy the common systems. Build the part that is yours.

Where to start

If you run a lending operation, ask your team one question: what do you do every day that the system should be doing for you? Write down the answers. Pick the one that costs the most time. Fix that first, then the next one. After thirty years, that is still the most reliable way I know to cut costs and improve margins.

By David Allen Wind, founder of Millwright Logic and DAW Partners.