You’ve created a lending process that works. Your team is efficient, your systems are configured, and you have invested in technology to remain competitive. But if you’re still relying on credit reports, static databases, or third-party records that borrowers didn’t explicitly authorize, you’re not as modern as you think.
Consumer expectations have changed. In a world where privacy and transparency are important, outdated data practices are more than just annoying; They are confidence killers.
Relying on legacy methods to verify income, assets, and employment slows you down. Frustrates borrowers. It leaves you vulnerable to errors, inefficiencies and missed opportunities. The future is consumer-enabled and it’s here faster than you think.
The move away from passive data collection is already happening
The traditional model for verifying borrower data was built around institutional convenience. Lenders pulled reports from third-party databases, often without explicit knowledge or control of the borrower, and used what they obtained to make decisions. But static data is not always accurate and is rarely up-to-date and complete. That can introduce problems that slow down the loan process and frustrate everyone involved.
Today’s consumers are used to controlling what they share, when they share it, and with whom. This expectation has been reinforced by privacy laws such as the California Consumer Privacy Act and the EU General Data Protection Regulation, which have made clear that consumers deserve transparency and control over their personal data. More recent developments, such as the application of the California Privacy Rights Act to data minimization and purpose limitation, make it riskier than ever to collect more than necessary or to do so without clear consent.
The new model puts borrowers at the center. Consumer permissioned data allows borrowers to grant active access to their payroll, banking and document sources in real time. Instead of uploading PDFs or tracking HR contacts, borrowers can share verified income and employment information directly from their payroll provider, with full transparency about what is being accessed. Asset data can be retrieved instantly via secure API connections, eliminating the need for declarations. Even document uploads improve when they follow a controlled and authorized workflow instead of being sent via email.
This change is about more than just convenience. It’s about trust. When borrowers understand exactly what they are sharing and why, they are more likely to remain engaged in the process. When lenders use real-time data from verified sources, they make faster and more confident decisions. And when both parties operate with transparency, the entire experience improves.
Permissioned data isn’t just better for borrowers: it’s better for businesses, too
Speed and accuracy are important in lending, and consumer-authorized data improves both. Instead of spending days manually collecting documents and verifying information, lenders can complete these steps in minutes, often within the same system they already use to originate loans. That translates to fewer touches, faster cycle times, and lower repurchase risk. It also frees loan officers and operations staff to focus on high-value activities rather than administrative ones.
For borrowers, the benefits are equally clear. They ask for less. They expect less. And it is not necessary for them to present the same document twice. Integrated verification feels seamless, not like a separate process, and reinforces that the lender respects your time and privacy. That leads to better reviews, more referrals, and repeat business over time.
Lenders that adopt consumer-authorized workflows also future-proof their operations. According to a 2025 Ogilvy report, the small business economy is growing three times faster than the traditional workforce and by 2027 will encompass half of the workers in the developed world. As the U.S. mortgage market evolves to include more independent, equity and contract borrowers, real-time, source-verified data becomes essential. Authorized access provides a scalable way to serve these borrowers without sacrificing accuracy or compliance.
The question is not whether the consumer’s permission will arrive, but whether you are ready
Lenders that continue to rely on static data and manual solutions are not only slowing down, they are signaling to borrowers that they are behind. In an industry where perception and experience matter, that’s a competitive disadvantage.
It’s time to ask tough questions. Can your systems support real-time access to payroll data, assets, and borrower-authorized documents? Are your workflows designed to respect borrower consent and improve transparency? Can you verify income and employment accurately without creating additional work for your borrowers or your staff?
If not, you’re not just introducing inefficiencies. You are introducing risk.
Conclusion: Authoritative data is the way to go
The old way of verifying borrower data no longer meets the needs of the modern mortgage market. It slows down the process, frustrates borrowers, and increases the risk of error. Consumer-authorized data is faster, more accurate and more transparent, and it’s what today’s borrowers expect.
Lenders adopting this model are not just updating their technology. They are improving their borrowers’ experience, their operational efficiency, and their ability to compete in a changing market. The change is already underway. The only question is whether your company is prepared to keep up.
John Hardesty is vice president of mortgages at Argyle.
This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners. To contact the editor responsible for this article: [email protected].
