BPM, Banks, and Document Generation

Document Services

While many of the world’s largest banks and financial institutions are embracing BPM technology, small banks and credit unions are also heading down the path to process automation. One regional credit union, for example, has now automated its loan-origination process and is reaping huge benefits.

For this particular credit union, its old, manual process was both long and tedious. Once a loan was approved, loan officers were required to complete a multi-page checklist to specify the necessary information and provisions for the loan documentation department. One of the problems with this stage of the process was that each loan officer had his/her own way of filling out the checklist. The variations in methodology led to back-and-forth verifications between the loan documentation department and the officer. Once the checklist was finalized, the loan documentation department then used a Microsoft Word template and a combination of merge fields and VBA to generate the complete set of loan documents. While this method was better than simply cutting and pasting, the system was not user friendly. Few of the credit union’s employees knew how to use it correctly, and many spent years before fully understanding the system. Finally, the credit union decided to automate its loan-generation process.

Intrigued by the concept of an expert-system style approach, the credit union searched for a solution. After adopting, and subsequently abandoning, various programs, the credit union discovered HotDocs. A committee was formed to wireframe the entire loan origination process, which content experts (rather than software engineers) modeled into a HotDocs process application.

With the new HotDocs application, the checklist was replaced with a “master interview,” into which loan officers now enter all customer and loan information. From this master interview, the credit union is able to generate documents in a fraction of the time it once took. In fact, the credit union reports that a short-term commercial loan that used to take 2 to 3 days now takes just a few hours or, in some cases, “a matter of minutes.”

According to the credit union, one of the most interesting aspects of HotDocs is its ease of use. All the automation work was designed, completed, and tested by the end-users (the content experts), so the company didn’t need outside programmers to build the system.

Another important benefit of HotDocs is the level of standardization it has imposed on the old, unruly process. “As the complexity of regulations within the financial industry continues to rise, standardization is becoming ever more important. Our HotDocs loan-origination system has become our communication medium,” stated one member of the credit union’s management team. “No matter what loan is written, it’s always done through the HotDocs system. It’s the one program everyone uses, and as such, we ensure that all changes in regulations or procedures are immediately written into the HotDocs system. This approach provides an enormous amount of security for us. Our loan officers don’t have to worry about new updates. HotDocs simply leads them through the process.”