You have to give them credit: Multifamily lenders are the MacGyvers of processing HUD and Fannie/Freddie loans.

Remember MacGyver? In that popular 80s TV series, “MacGyver” was a highly resourceful problem-solver who used unassuming objects in creative ways to solve major problems.

Much like MacGyver using a paper clip to diffuse a bomb, underwriters use Excel in ingenious ways to complete multifamily loans. And when approximately 50% of all HUD loans fail (after a year’s worth of work, no less), I’m sure it can feel like a bomb going off for many lenders.

No offense to MacGyver, but the era of using Excel to complete multifamily loans is over. Streamlined lending processes are on the rise.

Automation versus spreadsheets

Automating repeatable tasks – like knowing the status of a loan at a glance or populating 65 pages of an Underwriter Narrative – makes this complicated process drastically easier for both lenders and underwriters.

As Alicia Phaneuf reports in Business Insider, robotic process automation (RPA) is revolutionizing the banking industry “by enabling banks to complete back-end tasks more accurately and efficiently without completely overhauling existing operating systems.” Two powerful examples of banking automation in action include:

  • Singaporean bank OCBC repricing home loans in one minute versus 45 minutes.
  • Japanese financial institution Sumitomo Mitsui cutting 400,000 hours of manual labor.

The benefits of automation go beyond time saved. Business Insider further reports that by 2023, AI and automation can save banks an estimated $447 billion. The multifamily space can’t afford to ignore the potential time- and cost-saving benefits offered by streamlined lending processes.

Borrower expectations are evolving

Everyone knows this process can be long and difficult, and borrowers are tired of playing the same old game. Meeting personally with lenders for every loan, only to discover much later on that the original data presented is inaccurate, is a recipe for frustrated and fatigued borrowers.

Borrowers are starting to realize that the process doesn’t have to be this way. By streamlining the lending process using automation and other technologies, lenders are able to inject some consistency into the process. In addition to catching red flags early on, lenders have more accurate data at their disposal, allowing them to more definitively predict the success of the loan from the beginning.

Providing transparency and efficiency

From a managerial perspective, the complexity of the multifamily loan process makes for a lack of transparency. It’s challenging to gather data on all the loans lenders are processing while simultaneously trying to measure KPIs. While the best underwriters in the business have a magical, MacGyver-worthy way of getting the job done, these highly individualistic solutions provide little insight into emerging trends and how your team is performing on a granular level.

By shedding light on what’s happening at each stage of the loan process, a streamlined process empowers managers to efficiently manage their teams, to provide course correction when necessary, and even fine-tune the training process.

MacGyver-ing the multifamily loan process isn’t a long-term solution

In one episode in Season 1, MacGyver uses a fire alarm, a rope, two 50-gallon jugs of water and a sheet of plywood to take down enemy agents (while poisoned with a hallucinogenic drug, of course).

Admittedly, the contraption was successful. But here’s the thing—it wouldn’t work in the long-term. In fact, most of MacGyver’s problem-solving is born out of last-minute necessity. A streamlined lending process offers a better way—a more sustainable solution that benefits everyone involved in the multifamily loan process: lenders, underwriters, borrowers and the financial institutions themselves. And when everyone is successful, the state of the multifamily housing industry is successful, too.

You didn’t get into this business to be MacGyver, and you don’t have to be. Not any longer. But definitely hang on to that sheet of plywood—it may come in handy later.