Will Borrowers Rule Mortgage Tech in 2017?
In the past, it wasn’t uncommon for borrowers to feel uninformed, powerless, and frustrated during the mortgage process. Fortunately, technology advancements and new business models are beginning change to this experience.
Emerging mortgage technologies are laser-focused on building simple interfaces and putting manual, time-consuming processes on autopilot. This means faster closer times, empowered borrowers, and most importantly, happier customers. These are all good things for mortgage professionals and the mortgage industry as a whole.
In 2017, successful mortgage technology will aim to put borrowers in the driver’s seat.
Increasingly, borrowers will enter the mortgage process armed and ready — with information from online services like Zillow and Realtor.com — and will be able to make educated decisions themselves, rather than relying solely on advice from their loan officer or mortgage broker. And instead of filling out annoying forms to prove income or provide a credit score, borrower data will be pulled, verified, and sent directly to lenders. We’ll soon be saying goodbye to the constant emails and phone calls that borrowers are subjected to today.
What else is in store for borrowers this year? Here are 5 predictions from industry leaders:
Clayton Collins, HousingWire
While digitizing the loan application and credit decisioning process appears to be lender-focused innovation, the biggest beneficiary may be the consumer. Improved work-flow and automated data collection, will reduce the amount of documentation and financial records that borrowers are required to gather during the application process. Increased data accuracy and timelines reduces processing and underwriting timelines, and empowers loan officers to provide more accurate guidance to their clients.
Lenders are looking at the next generation of homebuyers, a generation that demands a more customer-centric and digitized experience, and developing or implementing solutions and services to meet these expectations. In a recent survey by PwC, 75% of respondents confirmed that the most important impact fintech will have on their businesses is an increased focus on the customer. Consumer demand is fueling mortgage transformation.
Jason van den Brand, Lenda
This is the year that consumers are finally being heard! Tech is being built to make things more efficient, and with more efficiency comes speed, accuracy, transparency, and lower prices. We fully expect mortgages to close, start-to-finish, in less than a day by 2020. Consumers chose Amazon over Walmart and Malls because it’s more convenient and a better experience. The same trend will be made toward Online Lenders as compared to legacy Banks and Brokers, both of which are operating with expensive bank branches, and commission-driven, telemarketing sales people. In other words, the internet wins again.
Ori Zohar, Sindeo
Consumers will have more access to information and a greater ability to drive forward the mortgage themselves. This also means greater expectations for on-demand service and plain English explanations of the more confusing/distressing parts of the mortgage process.
John Paasonen, Maxwell
A main goal for technology is efficiency, so while consumers will enjoy more control, transparency and a better user experience in 2017 for sure, we all hope it will come with a significant reduction in close times. Going from the average of 49 days today down to 2–3 weeks should be an expectation and, we believe, very achievable in 2017 for lenders who are equipped with the right technology.
Josh Lehr, Mortech, a Zillow Group Business
Consumers are getting closer to total transparency in their mortgage process. Mortech, and Zillow Group’s mission is to bring power to the people by “turning on the lights.” In the past, the loan officer had complete control of the workflow and was able to put smoke screens purposefully or inadvertently, in front of the borrower that made the consumer forever curious as to where the loan was in the process.
B2B tech providers have been working on APIs that expose mortgage product and pricing offers to the borrower, allow a borrower to link their bank accounts for asset and income verification, and even pull their own credit to be used for the mortgage file. Recent service provider entrants to the market have tied these APIs together to create a streamlined workflow empowering borrowers so then don’t have to settle for a second-rate experience.