Improving Home Equity Loan Pull-Through Rates

This white paper discusses the challenges faced by the home equity industry, particularly the low pull-through rates and high origination costs. It identifies that pull-through rates are below 50% and origination costs average around $4,600 per loan, despite favorable market conditions. The paper outlines how exceptions in the loan processing pipeline can lead to increased underwriting timelines, causing borrowers to abandon their applications. It critiques common solutions such as speeding up underwriting or loosening credit standards, arguing that these do not address the root causes of the problem. Instead, it emphasizes the importance of having a structured exception workflow and a clear credit policy. The paper presents FirstClose's Order Management Services platform as a solution, which automates the ordering and management of various loan components, significantly reducing manual processing and cycle times. The document also includes a case study demonstrating the success of Sharonview Federal Credit Union in improving their loan closing times and increasing annual volume after implementing FirstClose's solutions.