Home equity lending is having a moment, sure, but many lenders are still relying on mortgage-centric tools to manage these loans. On the surface, the logic makes sense: your mortgage LOS is already in place, your team is familiar with it, and you’ve already made a significant investment.

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But here’s the truth: tech built for first mortgages is rarely optimized for home equity lending.

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Whether you’re offering HELOCs, closed-end home equity loans or both, the speed, structure and expectations are fundamentally different. If you’re struggling with bottlenecks, delays or subpar borrower experiences, your tech stack might be to blame.

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So, how do you know if your current tools are holding you back? Let’s take a closer look.

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Signs Your Tech Stack Isn’t Built for Home Equity

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If any of these challenges sound familiar, your system may not be built for home equity:

• Long cycle times: If your average time to close extends beyond 30 days, it’s more than an inconvenience; it’s a competitive disadvantage. Today’s home equity borrowers often expect access to funds in just weeks, not months.
• Manual task routing or workarounds: Do team members rely on spreadsheets, sticky notes or email threads to move loans forward? These patchwork solutions create inefficiencies and increase the risk of delays or errors.
• Frustrating borrower experience: Is your application mobile-friendly? Are borrowers able to easily upload documents or track their loan status online? If not, you may be creating friction that can cause applicants to drop off.
• Limited visibility: Can your team quickly identify loan status, bottlenecks or overdue tasks? If not, it’s often hard to manage performance or improve efficiency.
• Pull-through problems: Are you seeing a high number of applications but struggling to close a healthy percentage of them? Your tech may not be supporting strong conversion.

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These pain points aren’t just frustrating; they’re often signs that your platform is designed for long-cycle, purchase-driven mortgages, not the fast-paced, high-expectation world of home equity.

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You may not need to overhaul everything, but you do need to pinpoint exactly where your system isn’t meeting the specific demands of home equity loans. A few key gaps can create large problems across your pipeline.

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What’s Missing: Gaps Between Mortgage and HE Needs

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While mortgage and home equity lending share some foundational principles, like credit review, collateral evaluation and compliance, their operational needs vary significantly.

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Here’s where mortgage tech stacks often fall short:

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1. Online Application Tools

Mortgage systems typically require detailed applications with dozens of questions, many of which aren’t necessary for HELOCs or closed-end loans. This complexity creates serious abandonment risk, especially on mobile devices. In contrast, purpose-built HE applications streamline the experience, capturing only what’s needed and improving completion rates.

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If your application tool is cumbersome or duplicative, you’re likely losing high-intent borrowers before they even reach underwriting.

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2. Task Management

Mortgage LOS platforms often assume a linear, milestone-based flow. But home equity lending moves faster and requires parallel processing across teams. Without automation and flexible routing, loan files can get stuck in queues or bounce between inboxes.

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This is especially painful when multiple team members, such as processors, underwriters and service coordinators, are handling parts of the same file. Manual tracking leads to missed steps, duplicated effort and slowdowns.

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3. Service Order Orchestration

Valuation, title, flood and closing requirements can vary significantly based on LTV, loan type, and borrower profile. Mortgage platforms typically don’t support smart service ordering tailored to HE loans, leading to higher costs, longer turnaround times and unnecessary steps.

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Smart ordering not only saves money but also shortens the path to closing. Lenders who optimize this part of the process can often shave days off the loan cycle and decrease the cost of origination.

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4. HE-Specific Workflow Configuration

Can you easily customize workflows for different HE products, branches or policy thresholds? Many mortgage systems simply can’t. That forces staff to rely on manual workarounds, which can significantly impact cycle time and consistency.

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Even if your LOS offers some configuration, those changes are often complex and time-consuming to implement. Home equity lending needs agility, not IT tickets and long change cycles.

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5. Pipeline Visibility and Reporting

Mortgage systems often give a high-level view of loan volume or funding status, but lack the granularity to analyze application drop-off, stage-by-stage cycle time or service-level bottlenecks. That makes it harder to diagnose issues and drive performance improvements.

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With home equity volume on the rise and operational teams already stretched thin, being able to identify slowdowns and resolve them quickly is a competitive edge.

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The 'Mortgage Mindset' Problem

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This isn’t just a tech issue; it’s an entire mindset. Many lenders treat home equity like “mini mortgages,” applying the same processes, pacing and expectations.

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But HELOC borrowers are in a different position than mortgage borrowers:

• They’re not buying a home; instead, they’re leveraging equity they already own.
• They’ve often shopped around and are ready to act now,  not in 45 days.
• They expect a digital-first experience, minimal paperwork and transparency from start to finish.

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Our previous article describes how this “mortgage mindset” can stall home equity growth. Lenders overcomplicate the process with unnecessary steps, slow service coordination or manual routing because their system assumes mortgage workflows. The result? Delays, drop-offs and missed opportunities.

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Even worse, this creates stress for frontline staff who are trying to meet borrower expectations without the right tools. It’s not unusual for lenders to have skilled teams who are overburdened by outdated systems that work against them, rather than for them.

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Breaking out of the mortgage mindset means completely rethinking how you use technology, how you engage borrowers and how you measure success. In a home equity world, speed, flexibility and ease aren’t “nice-to-haves,” they’re fundamental expectations.

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The Case for HE-Specific Technology

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A modern, HE-ready tech stack doesn’t mean replacing your LOS, it means enhancing it. Purpose-built platforms like Coviance integrate directly with your existing system, acting as an intelligent automation layer that accelerates home equity workflows from application to close.

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Here’s what that looks like:

• Presenting loan offers at the point of application, not days after submission, to move borrowers from interest to accepted offer within minutes.
• Leverage workflow automation to accelerate decision-making and underwriting on simple loans.
• Borrower portals that keep borrowers engaged and eliminate document chasing.
• Fast clear-to-close times — with some users reporting turnarounds as quick as 3 hours.

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Since 2021, Coviance has helped more than 415 community lenders process more than $19 billion in home equity loans. The platform is purpose-built for how borrowers actually behave, not how mortgage tools assume they do.

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Get Started with a Home Equity Health Check

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If your home equity performance isn’t where it should be, or if your team is constantly bending mortgage tech to fit a different lending model, it’s time to reevaluate.

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Ask yourself:

• Are we giving borrowers a fast, modern experience or making them wait?
• Are we closing loans quickly or getting stuck in outdated workflows?
• Are we scaling confidently or just getting by?

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If you’re unsure where you stand on any of these questions, we can help. Our Home Equity Health Check can help pinpoint performance gaps, uncover hidden inefficiencies and show you how HE-specific automation could unlock faster closings, better borrower experiences and sustainable growth.