The mortgage industry is evolving day by day as technology and data is integrated into every aspect of the lending cycle. More data is available for both the lender and the borrower for faster turn arounds, more accurate assessments, and a reduction in errors. It’s an exciting time for the mortgage industry.
Despite this rapid digitization of the market, mortgage brokers and loan officers will still play a vital role. It’s hard to envision a world where the entire home loan cycle is done virtually and here’s why:
Buying a home is the biggest purchase most Americans will ever make in their entire life. Borrowers need reassurance from a human being on the specifics of the deal. A recent study by Fannie Mae, called the Mortgage Lender Sentiment Survey, revealed that 90% of borrowers want person-to-person communication with their mortgage lenders.
Most prefer phone calls, followed by emails, and then face-to-face interactions at a branch location. The priority for these types of interactions are going to change throughout the life cycle of a mortgage. The first meeting with a mortgage broker, for instance, is overwhelmingly going to be face-to-face. Subsequent meetings, such as questions on paperwork or ironing out details, are best suited for rapid fire communications such as phone, text, or email.
The ability to speak to a human being is chief among the requests of borrowers.
Not every borrower can be fit into a web page form of 20+ fields. People have stories. These stories provide context around why an application may not on first look be an easy yes. Sometimes people get sick or they lose a job or an investment turns sour or they plan to supplement their down payment with a one-time gift from mom and dad.
These are extraordinary circumstances that often have to be considered by human judgment and not an automated underwriting algorithm.
The mortgage broker, among the many things that they do during a loan application, is also an advocate for the borrower. This includes navigating special circumstances as detailed above, but far more than that. With their experience, the broker can guide the future homeowner past many of the common mistakes that are made by first-time borrowers. They can educate the borrower, help prepare an application pre-qualification, and properly set expectations on the type of loan and home that the family can expect.
The mortgage industry is a highly specialized market and borrowers will always need a hero on their side to help them navigate the loan process.
Digitization is the most valuable when it can automate very complex tasks, such as all of the different requirements and steps in a securing a home loan. With more data becoming available, technology can now expedite pre-approval, approval, property assessments, and closing.
A broker, empowered with a great back-end platform, is the ideal solution for potential borrowers. With their lending experience, they can look down the road to potential roadblocks or hurdles for their clients. Tackling these types of challenges early is the key to a successful application.
Pacific Union Financial
Pacific Union Financial, LLC is a full-service mortgage lender providing originations and loan servicing across the United States. A privately held direct lender with Fannie Mae, Freddie Mac, and Ginnie Mae approval, we originate loans through our Retail, Wholesale, and Correspondent channels. Let us know how we can help you expand your business.