We recently had a fascinating conversation with George Baker, the founder and CEO of Talkuments.

Introducing Talkuments

Talkuments is the producer of a multi-lingual, digital home loan guide for mortgage lenders to provide to borrowers—especially multi-lingual or non-English speaking borrowers. The core concept is to use simple, everyday language to explain the complexities of the mortgage process, which hits home with our own concept of clarity. George first had the idea during his days of working in operations management with several mortgage lenders, evolving out of a few early concept digital tutorials to help borrowers understand things like the former “HUD-1 statement.” George had the inspiration to combine this type of clear, digital tutorial with the needs of LEP (Limited English Proficiency) borrowers.

The Coming of LEP Requirements 

If you’re not familiar with the term “LEP,” you soon will be. The rise of companies like Talkuments also highlights another discussion which will soon be commonplace throughout the mortgage industry: regulatory requirements addressing Limited English Proficiency borrowers. 

George pointed out that at the time of recording, 31 states had LEP laws and “unconscionability standards” mandating things like providing the contractual documents for a mortgage in the language primarily spoken by the borrower and prohibiting lenders from knowingly allowing a borrower to sign a document he or she does not understand. However, it’s currently difficult to enforce many of these requirements because a traditional “paper trail” doesn’t usually provide evidence that the contract signer didn’t understand the content of the documents.

Lender Compliance with LEP Regulations and Laws

George also noted that, at the moment, many lenders attempt to comply with these standards simply by hiring multi-lingual originators and designating them to serve with the markets speaking the language they understand. However, there are any number of ways that this approach can fail to meet the standard set by LEP regulations and laws. He also spoke of HR 3009 and other pending or rising federal requirements, some of which will require lenders to make available to customers resources in at least 8 languages initially, then an additional four at a later date.  The CFPB has also made LEP one of its priorities.

A Fox in the Henhouse

George also quipped that “We (the mortgage industry) bring regulations upon ourselves.” A long-time mortgage banker himself, George chided the industry as slow to change and slow to adopt technology, especially in consumer-facing functions. 

Right now, in a traditional mortgage origination, the only person truly available to explain the process and documentation to the borrower is the person benefiting most from a closed mortgage loan: the loan officer. George compared that to “the fox guarding the henhouse.”

A Potential Differentiator in a Competitive Market

George estimated that almost half of the buyers who speak English as their primary language do want to understand the mortgage documents put in front of them, but can’t. Now add language barriers to the mix, and the challenge is obvious. But that challenge could become a sales tool as well.

Keep in mind that as origination volume begins to “normalize,” and the marketplace becomes more competitive for lenders, the New American market will likely become a primary focus for marketing efforts. Jim pointed out that “the confused don’t buy,” and wondered how many times a lender or loan officer has lost an easy sale because of a failure to clearly explain the process and the value.  George pointed out that it’s simply more professional to offer a step-by-step guide for the consumer to go with the 150-page document being signed.  He further said that, while most lenders talk about improving the consumer experience as a top objective, it’s not happening in leaps and bounds. He highlighted the contrast between other industries, which speak to their prospects and customers in the manner the prospects prefer and provide them with information in the way they want it, and the mortgage industry, which has always described its process and products in the manner of its own choosing. 

Using Technology to Relieve LO’s on High Touch Points

Jim and George agreed that the mortgage industry could and should be using technology on the CX side to remove LO’s from the mundane questions and tasks that don’t necessarily require a sales person to manage to allow them to focus on points in the process and conversations that do require a personal touch. George also predicted that, “sooner or later,” we’ll have a “push button” mortgage process, and compared it to other online shopping experiences. If and when the potential borrower is quickly able to get approval on a mortgage, the dynamic will change completely, not only with the whole concept of a borrower choosing a lender by “test driving” the product online, but with the very dynamic of the relationships with REALTORS and loan officers as well.