Posted by MeridianLink | June 14, 2024

The Ultimate Mortgage LOS Change Management Checklist 

The materials available in this article are for informational purposes only and not for the purpose of providing legal advice. You should contact your own advisors with questions regarding the content herein. The opinions expressed in this article are the opinions of the individual authors and may not reflect the opinions of MeridianLink, Inc.  

For lenders, a loan origination system (LOS) isn’t just a piece of technology—it’s the cornerstone of your interaction with borrowers and a critical component of your mortgage operation. The process of adopting a new mortgage LOS can seem overwhelming, but the potential benefits are clear: cost reduction, enhanced efficiency, and an improved experience for both staff and borrowers.  

When planning for a major change like this, outlining essential steps and timelines, such as what to consider at 12 months, nine months, and six months out from implementation can help ensure no critical element is overlooked and assist in smoothly managing the transition. This structured approach can help you feel confident that you are mitigating risks associated with oversight, promoting stakeholder alignment, and optimizing resource allocation—ultimately enhancing your operational efficiency and competitive advantage in the market. 

To help you get started, we have put together a checklist that outlines key considerations at critical phases of managing change associated with implementing a new mortgage LOS. You can customize the checklists below to effectively navigate the complexities of LOS change management from selection to implementation.  

12+ Months 

About 12 months before you intend to implement a new mortgage LOS you should be planting the seeds that will help you embark on the journey to a new LOS with confidence and ease. This is the phase to get organized and document timing and purchase requirements. You’ll also want to start mapping out resource planning, internal cultural adoption requirements, and vendor selections.  

  • Understand internal purchase requirements.
    • For example, what is needed for vendor approval? Is there a purchase committee or IT committee to make decisions on technology purchases?
  • Determine the comfort level of LOS overlap.
    • Will 6 months’ work for my team, or only 1 month?
  • Create a list of priorities or decision criteria for LOS selection.
  • Talk to existing vendors about other partner integrations and what technology and companies they like to work with.
  • Calculate monthly payments for varying solutions in the tech stack for comparative analysis.
  • Create a general internal project plan for deployment.
  • Plan what resources you’ll need to assign to the LOS implementation project.
  • Consider how long it might take to finish in-flight loans before losing access to your existing LOS solution.
  • Assess your company’s cultural adoption requirements or demands.
  • Begin executive alignment on project priority.
  • Assess your existing LOS/tech stack.
    • Solicit and document user feedback on positives or negatives of your existing solution.
    • Identify what integrations are currently in place versus what is not and needs to be, as well as what integrations can be improved.
    • Ask yourself questions such as whether your software has latency issues, requires multiple third-party contracts, or if the workflow is cumbersome.
  • Determine which origination channels (Retail/Wholesale/Correspondent) you’d like to be operating in by the time you’re starting to process loans through your new LOS.
  • Begin reaching out to vendors you would like to review.

9 Months 

At the 9-month mark, it’s time to get internal teams and external vendors on the same page. Organizational buy-in is key at this stage. You’ll also be narrowing down your decision criteria for vendors as you move closer to the final selection. There are both big-picture and detail-oriented considerations—like opting out of auto-renew for your current LOS solution!  

  • Review renewal terms of your current solution to ensure you are not auto renewed or how to opt out if needed.
  • Narrow your decision criteria down to be clear and concise. Be willing to share this with vendors you are evaluating.
  • Secure top-down buy-in within your organization to align everyone with the project’s definition of success.
  • Define your budget range and obtain approval for the project.
  • Designate an individual as the leader of the project to collect information and manage an evaluation assessment team, if needed.
  • Establish a champion user to advocate and support the new software, become an early adopter who provides feedback on the experience, and will test real-world scenarios.
  • Host discovery calls with potential vendors.
  • Ensure firm resource allocation is in place.
  • Obtain executive clearance to move forward with the project.
  • Identify critical vendors and finalize contracts.
  • Have investors identified or signed up early.

6 Months 

You’re in the last mile! It’s time to start executing tasks that will help you get into the home stretch of implementation smoothly and without delay. This is the stage to cross your t’s and dot your i’s, and your checklist should reflect this.  

  • Set expectations to have a usable solution at release versus a perfect solution.
  • Limit additional simultaneous projects for the best outcome.
  • Host additional pre-implementation calls with short list of LOS providers or chosen provider.
  • Have vendors in place for critical applications, such as Docs, Hedging, and Credit.
  • Have investors already signed up and ready with logins for your Product and Pricing Engine (PPE).
  • Create very concise execution items and prioritize them above tasks not on this list.

The Big Picture  

Understanding what tasks to prioritize is crucial, but you also don’t want to lose sight of the big picture—including strategic alignment, improved efficiency, and ensuring everything works as it should. As you navigate closer to your implementation date, keep the following in mind.  

Strategic Alignment and Team Collaboration 

The foundation of a successful LOS implementation is built on strong strategic alignment and collaboration—with your technology partner and internal team. It’s vital that everyone grasp the full scope of the project, understands the associated risks, and agrees on a clear project plan and timeline. 

Configurable Workflows for Enhanced Efficiency 

Configurable workflows and role-based navigation allow your institution to scale and adapt as needs evolve. Collaborate with your technology partner to explore and understand various capabilities and configuration options. Starting with default settings and gradually customizing them allows for flexibility and aids in making informed decisions as you familiarize yourself with the new system. 

Rigorous Testing of All Configurations 

Before your new LOS goes live, conduct a thorough testing phase. You should rigorously validate all configurations by testing them against life-of-loan workflows, pricing engine results, integrations, and document packages. Utilize a comprehensive testing plan that includes sample scenarios and tools to ensure that every component functions seamlessly and meets your expectations.  

Following a structured, documented approach and ensuring rigorous testing, strategic alignment, and effective configuration from the outset is the key to success. With your bases covered, your institution can smoothly transition to a new LOS that enhances operational efficiency and meets the evolving demands of both borrowers and internal teams.  

Lenders choose MeridianLink® Mortgage, a cloud-native and 100% browser-based offering, for its robust and customizable workflow automation that empowers them to swiftly scale their business. Its powerful open APIs facilitate seamless integration with hundreds of trusted vendor partners and enables customers to build custom extensions to the LOS. The platform’s comprehensive suite of tools includes a best-in-class native product and pricing engine, a built-in electronic document management system, and versatile web portals catering to both the consumer direct and third-party origination (TPO) business channels. MeridianLink Mortgage is designed to streamline the mortgage origination process at every step, helping lenders reduce costs and decrease their time to close.  

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