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Colonial Launches Home Loan Now
by Rick Grant
National Mortgage News, June 17, 2002
A new online mortgage approval system is allowing Colonial National Mortgage to deliver loan decisions to homebuyers in minutes. The technology, provided by Dexma, Minneapolis, and customized by Colonial Mortgage's in-house IT team, went live last Monday.
Home Loan Now offers the decision engine and a suite of financial tools to assist consumers in determining how much they can afford, principal and interest payments, and estimated closing costs. The service lets the borrower run financial scenarios with different rates and loan products, including conventional and adjustable rate mortgages. A complete glossary of mortgage terms in easy-to-understand language is also included.
"Home Loan Now completely revolutionizes the mortgage application process. The application can be completed in about 15 minutes," said James E. DuBose, president of Colonial Savings, parent company of Colonial National Mortgage. "The loan decision, based on the submitted financial information and credit report, is usually delivered within three minutes."
This is in contrast to the system the lender used before Home Loan Now. While the company has been on the Web for the past five years, it was little more than a lead generation tool that fed prospective borrower information to company loan officers. Home Loan Now is deployed on each of the lenders loan officers personal websites.
With the new technology, Colonial National is able to offer more than a pre-qualification to its customers. A firm loan approval can be printed from a customers home computer within minutes, allowing them to make an offer on a home the same day, Mr. DuBose said.
According to Dave Motley, executive vice president of Colonial National Mortgage, the company entered into negotiations with Dexma in April. "We met with them during the first week of March and signed an agreement on March 8. We rolled out the product to our affinity lending group on Monday."
The company launched an aggressive television and radio marketing campaign in the Dallas/Fort Worth area last Monday and said that the site was generating business for the company by later that same day.
"We were looking at sessions from Monday," said John Farrell, who heads up origination technology for the company. "About midday we turned the system on and that day the site saw 183 user sessions. Tuesday, our first full day, we had 294 users onsite."
By last Wednesday, the technology had put 12 new deals into the companys pipeline.
Mr. Motley said his company has reason to believe that the prospective borrowers who use the site will follow through, as they must pay a $75 processing fee before they receive a decision. That money is later applied to closing costs.
With assets of $1 billion, Colonial National originates more than $2 billion in FHA, VA, conventional and innovative single-close construction loans annually.
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