Archived Columns

Ellie Mae's Encompass Takes Explaining

By Scott Kersnar, Editor, Mortgage Technology Magazine

I recently drove down from my home office to San Ramon, Calif., for a Chip Cummings seminar on Ellie Mae's Encompass (now in version 2.8). Because Encompass is more daunting to master than traditional broker LOS systems, Ellie Mae has been offering sessions like this twice a month at locations across the country.

If the session I attended is any indication, these seminars are drawing a lot of interest. All the seats were taken and they kept bringing in new chairs to accommodate an overflow crowd.

This was one of the first Encompass seminars Ellie Mae has done for free, Ellie Mae chief strategy officer Jonathan Corr told me, and many audience members were current Encompass users. "Half the folks that show up have already purchased the Encompass software and done the Webex demo," he estimated.

Last year at this time, Ellie Mae claimed about 7,200 companies as customers. Now Encompass boasts 11,500 companies. He quoted me $1,495 for a 10-seat office, or about $150 a seat for the software.

While there are various reasons for brokers and loan officers to consider Encompass, he said, the crucial vote is likely to come from the processor ranks.

Broker LOS systems have traditionally been the jealously guarded tool of the loan processors, who typically have learned one system backwards and forwards. Having absorbed that system into their blood and bone, they warn the boss not to even think of swapping out that system for another.

Ellie Mae quotes one loan processor as saying the biggest reason she saw for converting to Encompass is that the system gives brokers and loan officers their own views of loans in the pipeline, "so the best thing about Encompass for me is that loan officers can look at loan status themselves and stop bugging me."

Loan officers will go for a new LOS only if convinced it will help increase their business. "People hate change," said Mr. Cummings, "You have to give them something they know is better. To get the full benefit of Encompass and actually make their jobs easier, users have to be willing to customize a few things, combine different functions to set it up the way your business works." Once they do that, he said, they can eliminate Act and Outlook, for example, and use the Encompass database for marketing purposes. "They don't have to recreate a whole system."

The Chip Cummings show itself was worth the long drive. He is an active mortgage broker/banker with 19 years experience and more than a $1 billion in loans under his belt. As a long-time Genesis 2000 user, he has roots in Ellie Mae's history and is one of the few people outside the company who gets direct access to Ellie Mae programmers. He told me that some of the improvements leading to the current 2.8 version of Encompass -- such as providing convenient buttons to the GFE, 1003 and other frequently used documents -- came at his suggestion.

In some cities as many as 40% of the audience is made up of brand-new users, said Mr. Cummings, and 75% of audience members have been on the system less than six months. "Some of them are very experienced mortgage veterans, but they are learning new ways to present information and new tricks to streamline their operations," he said. "They are learning to give customers an experience from point A to point Z."

The audience at the session I attended was composed more of loan officers than processors and closers. Much of the discussion had to do with using Encompass as a sales tool to show borrowers how they can "rent money" wisely to create money management strategies for themselves -- how you can combine Encompass features to create amortization schedules that show borrowers why they should go for a 3/1 ARM rather than a 30-year fixed loan and pay the loan off in 23 years instead of 30.

A loan officer with minimum skills can use any broker LOS system to determine an interest rate and monthly payment for a loan prospect. But there's more to it these days. The loan officers who want repeat business, particularly those who want to develop relationships with affluent borrowers, have to have some of the same skills as a financial planner. "You need to be talking as a professional," Mr. Cummings stressed. "A lot of consumers shop for the wrong thing. You have to be able to show them why a 5% interest rate should be good but can cost them more in the long run. A tool like Encompass is just crucial for that."

Crucial or not, a whole lot of loan officers are pursuing their careers with no assistance from Encompass. When senior executives at Amstar Mortgage wanted their offices to start using Encompass, recalled Mr. Cummings, they ran into resistance. "It was a case where they knew Encompass was a great concept and did a soft roll-out of the program, but needed to bring in someone to show off the tools and get them excited about Encompass." With his help, he said Amstar conversions to Encompass increased.

Encompass 2.8 certainly has come a long way. In addition to the multi-user edition -- which offers unique views for the broker/owner, loan officer, processor and closer -- there is a streamlined personal edition for one-person shops and trusted financial advisors, plus Encompass Anywhere for secured remote access.

Ellie Mae offers free migration to Encompass for its existing Genesis 2000 and Contour customer base. Whether or not that conversion campaign has proven sufficient to stem run-off from that base, I don't know. When a company tells its customers it's time for a change, it can't dictate how they will make that change. But meanwhile, lawsuit settlement aside, Ellie Mae continues its aggressive campaign to convert Calyx POINT users with a "simple two-click import capability that provides quick and easy migration."

Mr. Cummings says Encompass lives up to its promise. "From the standpoint of an integrated product," Mr. Cummings told me, "there is no competition out there right now."

"No competition" is a bit of a stretch. Calyx POINT users seem to find ways to craft integrated solutions of their own via products like PushMX. Then there's Xetus. And the new point-of-sale system Del Mar Database has brought to market. But for the users willing to master the graceful way Mr. Cummings dances through the tools described in the 90-page Encompass guide -- the ePASS service tabs, the pipeline functionality, the loan workplace, the proactive document tracking alerts, the e-document management tools, the contact and lead management synchronization, the report capabilities, the dashboard layout tips -- everything is there to deliver a very high level of professional service.