Case History: Originating From a Yacht

Fidelity Mortgage, headquartered in Tucson, Ariz., is on a mission to make paperless mortgages a reality. In order to show the origination community in general—and Fidelity’s employees in particular—that loans can be originated and closed from virtually anywhere with the right technology, the company hosted a unique event: originating $10 million in loans over five days from a 65-foot yacht in the San Francisco Bay.

Nick Haines, co-owner and executive vice president, organized the event, which took place May 18 to 22. “I thought it would be a great way to teach originators how to use technology to enable them to produce no matter where they are or what they’re doing,” he said. “I also thought it would be a great training method, rather than training employees in the office.”

The Goal
Fidelity, a mortgage banker with approximately 50 loan officers and 80 employees total, is licensed in 12 states and has three offices on the West Coast and two in Arizona. “About 75 percent of the technology that we have is being utilized by our employees,” Haines said. “We want to make our office even more efficient.” Haines, who works in Fidelity’s San Francisco office, has found that the concept of a paperless mortgage is surprisingly accepted by consumers. “Right now, about 15 percent of our applications are received online through our company Web site,” he said. “Our goal is to have about 95 percent of our customers apply online from the convenience of their own home. This cuts down on the amount of time we spend on each transaction, and has ultimately provided better customer service.” Haines noted that customers do, of course, sometimes need a live person to communicate with to make them feel more comfortable, but that overall, they are open to the idea of making the mortgage process much easier.

It was the hesitancy on the part of Fidelity’s employees that led to the idea of originating loans on a yacht. “I thought it would be a really fun way to show that you can originate loans from anywhere,” he said. “We want to teach them how to cut back on the use of 90 percent of the paper used during the origination process.”

The company chartered a 65-foot yacht called “The Five Star,” which took Fidelity employees around the San Francisco Bay while they conducted business. The event kicked off at a home game of the San Francisco Giants, with the boat anchored outside of Pacific Bell Park for a Sunday afternoon game. For the rest of the week, the company held regular business hours, answering customer calls that were forwarded from the office lines to their cell phones. “The loan officers were close to their laptops at all times, ready to take incoming customer calls,” Haines said. In between originating loans, the employees were able to enjoy the sights around the bay area, including trips to nearby popular tourist destinations such as Sausalito and Tiburon.

Since the event wouldn’t be affecting the way the loans were handled from the customer’s point of view, the company kept advertising for the event to a minimum—only a small ad in the San Francisco Chronicle, on Sunday and on Tuesday. “With all the technology that we have, it was just ‘business as usual,’ but from a boat. We used cutting-edge technology to originate, process, underwrite, and close our loans,” Haines said.

The Technology
The main technology that is needed for conducting business from remote locations, according to Haines, is the use of one common server. “Having a common server where all data can be shared and accessed by all employees in real time is the one thing that’s really necessary to make paperless mortgage a reality,” he said. “We do share a common server, which makes the sharing of live data possible in all of our markets.”

After setting up a common server, originators simply need to take advantage of readily available technology—tools that many originators are already using on a day-to-day business, such as laptop computers, cell phones, and automated underwriting systems. Fidelity Mortgage had two laptop computers set up on the yacht; originators were able to access the Internet on the laptops via Bluetooth ( wireless technology, which enables a cell phone to be used as a computer modem. They also used their cell phones to pick up customer phone calls, which were forwarded to the phones from their office landlines. Customers were able to quickly qualify over the phone and were then directed to Fidelity’s Web site to fill out the initial 1003 form online. Using e-fax capabilities, which allow faxed documents to be sent as e-mails and displayed on-screen, loan originators were able to gather customers’ documentation information; this eliminated the need for fax machines.

Once the computer received the customer’s information, an electronic file was automatically created for that customer; any employee was able to access and update a customer’s information, which was stored on the server. Data could then be electronically moved from the loan originator to the processor to the underwriter, and all finished files were stored electronically. Since Fidelity funds loans in its own name, the process was much more streamlined because they didn’t have any delays in waiting for outside lender approvals.

The Results
Fidelity Mortgage exceeded its goal for the event, which was to originate $10 million in new business in five days, according to Haines. “We hit almost $12 million, with 43 loans. The great thing about it was that it was invisible to our customers. The phones were forwarded to our cell phones, and the customers were directed to our online Web site for applications. The file was then processed from the Tucson processing center,” he said. “Our employees had a chance to learn in a new environment using features on their cell phones, such as Bluetooth linked with their laptops. And, they were also given the opportunity to visit the San Francisco area.”

As the rest of the world turns more and more toward online and automated processes, many originators may find it becoming increasingly harder to compete using only paper faxes and files. Regardless of how far we are able to take the paperless mortgage, there will never be “peopleless” mortgages.
Originators at Fidelity Mortgage have shown that it is possible to combine good old-fashioned customer service with the latest technology. As Andrew Wieser, an originator in Fidelity’s Tucson office, put it: “There will probably be some resistance to paperless mortgages initially, but there was also probably a lot of resistance to the switch from typewriters to computers—and look where we are just 10 to 15 years later,” he said. “I think the single greatest advantage to the customer will be the additional two to three days (or more) that can be shaved off current times. With just a few phone calls and clicks of the mouse, conditions and requirements can be met instantly (and cheaply) compared to the current time-consuming, resource-wasting, and laborious methods that are employed now. Within three to five years, a paper file will be about as archaic as a slide rule, and everyone—from the customers to the underwriters to state banking auditors—will appreciate the speed and convenience of a 100 percent paperless mortgage.”

By Rachel Richards