The Future Direction of the Mortgage Industry in the Digital Age

Over 40 digital companies made presentations at the 2nd annual Digital Mortgage Conference in San Francisco.


The mortgage industry due to inefficiencies in the system and opportunities for digital entrepreneurs is on the cusp of a significant digital revolution.

Mortgage tech companies will create APIs for end-to-end digital mortgage systems and deals will be made between data aggregators and the major institutions.



Mortgage Industry Research shows

Borrowers are more likely to find their lender through online research or social media than they were 5 to 10 years ago and less likely to find their lender based on a Realtor referral.

Online mortgage adoption spans “all age groups” and demographics.

More than a third of all borrowers prefer self-service websites, especially during the research stage of getting a mortgage, but still want instant access to mortgage professionals as they move through the process, be it via online chat, telephone, text messaging or email.

Those surveyed said the #1 thing they’d change about the mortgage process is to make it faster.


Lenders & Brokers

Lenders will need to decrease turnaround times, making brokers wait a week or two for an approval will be unacceptable.

Lenders with 5+ day turnarounds five years from now will be left behind or go out of business as consumers grow more accustomed to quick (even instant) online approvals.

Artificial intelligence will be used to better understand what borrowers can afford and better identify their propensity to pay, lenders will “employ predictive analytics” to determine which consumer to reach with what offer.

Lenders will offer brokers “high-end plug and play” electronic marketing (ads, websites, video training, e-newsletters, etc.) with the broker’s own name on it.

Margins will shrink for lenders and brokers as  efficiencies go up, and costs go down in the new digitized, commoditized mortgage industry.

The best place for consumers to get a loan will be from mortgage brokers as they offer a range of options as opposed to retail lender, banks etc that only have the one product.


What will the future look like?
 
We’re as few as five years away from digital mortgage providers completely taking over.

Efficient electronic document processing is starting to define the leading players, some lenders are already retrieving borrower docs in the background (via electronic access to tax returns) and payroll companies (via electronic access to pay stubs), and a digital down payment confirmation system will be launched in the not-too-distant future.

Virtual e-closings are coming too, soon you’ll click an app, a virtual notary will pop up on FaceTime, he/she will verify your ID and go through the security questions….and it will happen anytime, day or night at the customer’s behest.


Need a mortgage?: 
Ontario https://mortgagesintoronto.ca https://mortgagesintoronto.ca

Comments

Post a Comment

Popular posts from this blog

New Source of Financing Down Payments

Image
New Source of Financing Down Payments The Canadian Real Estate Association is lobbying the federal government to allow parents to borrow from their registered retirement savings accounts (RRSP) to help finance their children’s down payments. CREA, with more than 100,000 agents, brokers and salespeople, has made a 2018 pre-budget submission proposing changes to the Home Buyers’ Plan (HBP). The Home Buyers’ Plan (HBP) currently allows a first-time buyer to withdraw up to $25,000 from an RRSP account to help purchase or build a home, the CREA wants to expand the program so that parents can withdraw from their RRSPs for their children to help purchase a home. Under the plan both parents would be eligible to take funds from their accounts, the CREA would also like to raise the maximum withdrawal limit to $35,000. The government requires that RRSP withdrawals are paid back within 15 years. Family already plays a big role in financing first-time buyers. A survey by Genworth Canad...
Read more
New-home sales in GTA hit 20-year low in April New construction home sales hit the lowest number for April in over 20 years, says the association that represents home builders. Newly built single-family home prices dropped 5 per cent year over year to $1.15 million, down from about $1.2 million in March. But the benchmark price for condos continued to rise — 29.8 per cent year over year to $739,965, but down month over month from $742,801. In April, sales of single-family homes — detached, semi-detached and townhouses — 70 per cent below the 10-year average.  (ANDREW FRANCIS WALLACE / TORONTO STAR FILE PHOTO) There were 65 per cent fewer houses and condos sold last month compared to April 2017. That put the sales of single-family homes — detached, semi-detached and townhouses — 70 per cent below the 10-year average. Condos were 38 per cent below that average, according to the Building and Land Development Association (BILD). Although new home data by Altus Group goes b...
Read more