MIAMI - Lenders and technology vendors at a conference here heard some old-fashioned advice on newfangled lending from an industry leader: Stay focused on customer service.

Gary F. Moore, the chief information officer for Chase Manhattan Mortgage Corp. in Edison, N.J., said that though the Internet is probably the "largest sweet spot … we have ever experienced," lenders "need to be accessible to customers anytime, anywhere" to stay in business.

"Today the customer is king," Mr. Moore said last week at American Banker's mortgage technology conference.

The message comes at a tough time for the mortgage industry. Interest rates are up, origination volumes are down, and traditional lenders face competition from Internet companies and the prospect of a challenge from big financial services firms gaining powers under new law.

Joseph Hausauer, chief executive officer at, a Seattle company that is working on credit scoring, said customer expectations for on-line mortgage services have been rising. Companies failing to meet these expectations will be at a "severe disadvantage," said Mr. Hausauer, whose company is partly owned by Washington Mutual Bank.

Web sites have evolved to the point where they add value rather than serve only as a virtual brochure or a source for call center operations, he said.

Internet mortgage originations are expected to reach $525 million this year and be triple that amount by 2003, said Patrick Mahaffey, executive vice president for sales for Brightware Inc., a mortgage technology and consulting firm in Novato, Calif.

"Pre-approval and taking a loan application are not enough," Mr. Mahaffey said. "You need to be able to provide the same service on the Internet as you can by having a loan officer on the phone." Otherwise, he said, companies will compound their costs by having to operate on the Internet and by phone.

The Internet already returns less on investment than any other origination channel, Mr. Mahaffey added.

At a time of work-force cutbacks in the industry, vendors and lenders alike find themselves forced to maintain strong teams schooled in the new media and systems.

"There has been an increase in … hiring in both technology and e-commerce personnel," said J. Stan Conner, executive vice president for financial services and technology at Corporate Management Advisors Inc. in Jacksonville, Fla.

Mr. Moore of Chase advocates offering products that cover the entire homebuying process. Small lenders unable to create all those products can fill the void by working with associations or by acquiring or partnering with other companies, he said.

He said Chase is implementing a single origination system for six lines of business and coordinating its on-line system and back-office processing operation. It is also creating a "digital file cabinet" for information storage and transfer, and trying to smooth the data flow at its four call centers.

Mr. Moore said Internet-age lenders must be agile in adding value for their customers. Competitors, he said, are "just a mouse-click away."

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