Even as big Indian mortgage process outsourcing (MPO) units lose business
from clients going bust owing to the US'' sub-prime mortgage crisis, String Real
Estate Information Services is expanding its operations.
$6-million revenue company will increase the headcount in its Indian subsidiary
to 1,100, by 2008 from the current 450. It is also looking at Coimbatore and Madurai
for setting up processing centres. Mortgage processing involves checking loan
applications for details like the property title, credit worthiness of the borrower,
now on, the American mortgage lenders will look at credit appraisals seriously
but at a lower cost to remain profitable, says Prashant Kothari, CEO and founder,
String Real Estate Information, US.
the recent crisis, the projections for mortgage loan issuance in 2007 through
2009 are well in excess of $2 trillion.
to Kothari, the US mortgage industry is worth $13 trillion ($8 trillion home mortgage
and $5 trillion commercial properties). This involves back office and transaction
processing work worth $100 billion annually.
Though the potential for
offshoring mortgage processing is around $10 billion, the US lenders are outsourcing
only $200 million worth of business. But this is expected to change. But this
time only the specialised and experienced units would stand to gain.
to Kothari, MPO for US lenders is a specialised activity. The processors have
to check atleast 60 documents in respect of a single file and that number doubles
in the case of complicated files. .
said the MPOs are paid on file basis. The processing rate of a simple file is
$30 and goes as high as $120 for complicated files.
Real Estate Information will hire people who are good at numbers and have analytical
skills. Kothari says Indian companies are better placed to offer MPO services
than telemarketing of loans to the US.
amount of training would enable an Indian telemarketer to understand the American
borrowers psyche. One Indian telemarketing company made around 50,000 calls to
the US only to close 2 transactions successfully," he remarks.