Babar Chaudhary is a serial entrepreneur with a head for tech whose innovative software solution increased profitability for oil and gas companies with properties in the hundreds of millions of dollars. Today, as the founder of Mortgage Automation with 20 years of experience in the mortgage industry, Babar has done it again with his latest technological brainchild. Launched in January 2019, Mortgage Automation focuses on helping lenders close loans faster, with greater accuracy, and cut costs. In just nine months since its release in March 2020, Babar’s software solution has already been adopted by over a dozen lenders with more than 4,000 brokers and over $8 billion in mortgages, including Lend US and PRMI. We sat down with Babar to learn more about his three-year endeavor to solve a long-standing problem for lenders across the globe and how his technology is benefiting the entire real estate industry.
Tell us about Mortgage Automation and what drove you to found it.
I’ve been in the mortgage industry for decades, and I noticed that our industry solved problems by adding employees. It’s an archaic solution that doesn’t work. When more people are getting loans, mortgage companies must hire more people to support the demand. What happens is, one, even if you do find qualified people, you still must train them in your processes and there’s diminishing return and, two, even with a fully qualified staff, there are only so many hours in a workday, and human error still occurs. To address these issues, I started a mortgage software automation company that eliminates human errors, decreases the time it takes to close a loan, and cuts costs.
Will you explain how your innovative technology is solving these problems?
Leveraging RPA technology, lenders can take any task that used to be time and manpower intensive and assign it to their workforce. Tasks that used to require entire departments can now be automated and virtualized, requiring no human intervention, by using bleeding-edge technology with intuitive bots that process the information as a human being would—but with a 99.01% accuracy rate. Mistakes are very costly to lenders. Robots don’t make mistakes, they’re not worried about their personal drama, professional or career challenges, which are common sources of mistakes.
The adoption of your technology is growing at an astounding rate. What value does your software bring to mortgage lenders, specifically?
The biggest value to our mortgage lender clients is two things. One, it will reduce their processing fees by 50% and closing time by half, and can double the money they make. Two, it effectively eliminates the costs associated with human errors, which could equal the entire loan amount. Simply put, the more loans lenders process—and accurately—the more money they make. That was the goal with the technology—and we’re delivering that to our clients.
Your technology benefits not only mortgage lenders, but professionals across the real estate industry. Will you explain this domino effect, so to speak?
Of course. There are many players across the real estate acquisition process, and our solution brings tremendous value to each of them. Real estate agents can thrive because they can get their clients in a home quickly and with a better deal. Mortgage lenders can save money, improve their processes, and increase the efficiency of the loan process, which, in turn, will allow them to not only process more loans, but attract more agents and borrowers, further increasing profitability.
Designing this software was a three-year labor of love for you. What prompted you to develop it?
Developing this technology was a long journey and a lot of sleepless nights. At the time I was consulting for mortgage companies and working on the software nights and weekends. It was a lot of weekends home and staycations! I had watched the rise and fall of the mortgage industry over my career, especially the 2008 housing crisis, when the government imposed greater regulations on mortgage companies. As a result, lenders are making the same money per loan, but now they need to have all these staffing requirements to be compliant with government regulations, and borrowers now expect to get loans closed at record times because we live in a society where people want everything right now. Bottom line, more staffing, less money, and more pressure to close loans quicker.
I realized the only way to achieve all those mandates and still make money was through new technology that makes the process more efficient and more accurate. You can’t eliminate government regulations, you can’t change that people want loans now, but I knew that lenders could significantly reduce their staffing costs to increase profit. I had done something similar with my previous software for the oil and gas industry, so I knew that I could develop technology for the mortgage industry that would allow them to reap the same benefits.
How is Mortgage Automation helping its clients succeed despite the challenges of the pandemic?
Managing people during COVID is incredibly difficult for lenders. Everyone is doing their best, but quality suffers, your costs suffer, and your operations overall. If you were to take your operations and hand it off to bots, this solves those issues because bots work 24 hours a day. They don’t take sick time; they’re not having to navigate remote offices in their homes while trying to care for their families and deal with connectivity issues and just overall infrastructure obstacles. With bots, businesses, even in the era of a global pandemic, can continue uninterrupted. Lenders who have already adopted our software are reaping the benefits, and mortgage brokers and real estate agents are thriving.
Let’s end with a somewhat personal question. What motivated you to follow an entrepreneurial path and start your own businesses—two of them?
My father, Younas Chaudhary, came to North America with $35 and a dream. He worked three jobs, was going to school, and supporting our family. Since then, he started an oil exploration company that achieved the highest levels of success, wrote a book, From Dirt Roads to Black Gold, and became a philanthropist. He's been a great example of how work ethic, passion, and believing in yourself can make your goals attainable.
Founder — Mortgage Automation