Whoever said knowledge is power was definitely on to something. If not, can you explain why companies in every industry have seemingly gone crazy for analytics, and business intelligence specifically? Big data is here, and apparently, it’s even bigger than we thought. As companies all across the United States duke it out for market supremacy, those who do the best job at using business intelligence (BI) to get actionable insights are the ones that will thrive in the 21st Century.
The main reason companies have invested so much in data analytics and visualization is to help them make better decisions regarding marketing campaigns, customer experience, and market changes. All things considered, it should come as no surprise to anyone that lenders are using analytics to help them make decisions regarding the lending process. Continue reading to learn how business analytics enhances the loan process for both lenders and borrowers.
Mortgage companies use analytics to determine qualified borrowers
All homeowners know how arduous the process of getting approved for a home loan can be. You have to save for a down payment, get your financial affairs ready for review, and make sure your credit score is up to par. Even though you know that the higher your credit score is, the lower your interest rate and monthly payments will be, but have you ever asked yourself what constitutes a good or bad credit score?
It’s true that your credit score tells companies a lot about your creditworthiness, but have you ever wondered how they use your historical data to come up with one number that tells your creditworthiness? The answer is, of course, analytics.
Lenders know what your credit score means because they use BI tools and data analytics to gain insight into the story your credit history tells. For instance, using BI software, financial institutions can pull metrics from multiple data sources and find patterns or trends that speak to current conditions and even future events.
For instance, lenders can use BI tools to find patterns in behavior for people with a credit score and credit history similar to yours. With data mining tools and machine learning algorithms, lenders can get insights that would be missed by a credit report alone.
Business intelligence tools make data integration, data discovery, and other data operations easier
Big data is like a fortune teller for businesses, and the more data analysts have to work with, the more actionable insights they can provide for a company’s key decision-makers. It’s important to shop around to find the right BI platform because not all of them are created equally.
Data discovery and data integration are two of the biggest problems business users face when dealing with advanced analytics. However, when a vendor or any other business invests in BI tools with interactive dashboards that can pull analyses from various data sources, you can view them all at once. The best thing about these types of business intelligence software is that they’re a SaaS (software as a service), meaning the business intelligence vendor is the one who monitors, updates, and fixes bugs in the BI tool.
The key is to find the BI platform that makes data discovery, data mining, and data preparation as simple as possible. Go with a company that engineers their BI applications with business users and tomorrow’s data analysts in mind. Also, find analytics tools that are comprehensive and relatively inexpensive to help buoy your business decisions.
Lenders use BI software to enhance their marketing campaigns
Marketing might be more of an art than a science, but it’s an art that, nevertheless, relies heavily on data science. One of the most powerful ways mortgage companies and other large enterprises use business intelligence analytics is to get current data in real-time on their marketing campaigns.
Also Read: How to Use Your Business Analytics Tools
Maybe you’ve noticed in recent years that advertising is more targeted now than ever, and even lenders have gotten in the new marketing trend. Thanks to customer relationship management (CRM) software powered by BI tools like predictive analytics, lenders can market directly to the people who are already looking for the services they provide.