Before, to get a mortgage, you needed to go to your bank or credit union. You’d sit down with a loan officer and complete the process. It took a long time and there were usually a lot of phone calls back and forth.
Fast forward to today and you can do most (or all) of the mortgage lending process online. The number of traditional lenders has decreased because of the online competition where borrowers can secure lower rates and fees, and a more efficient process.
Fintech continues to improve the mortgage lending industry, making it better for both consumers and lenders, here’s how.
Faster Processing Times
With most of the mortgage process done online, there’s greater efficiency than when consumers deal with a human processing their loan. Fintech programmes can process many of the documents automatically. The few that need human interaction don’t take up much time, which means borrowers are closing loans much faster.
Fintech Helps Lenders Reach other Markets
The traditional borrower at a bank has ‘great’ credit, a low debt ratio, and a large down payment. Unfortunately, that doesn’t cover even a quarter of the normal human population but most people didn’t realise they had other options – that was just the way it was.
Today, with the onslaught of fintech mortgage lenders, there is wider access to mortgage programs for everyone – not just borrowers with perfect credit and large down payments. The underserved markets are now being served.
Fintech Offers More Opportunities
With the onset of fintech mortgage companies, there are more loan opportunities for different types of borrowers. Before it was very black and white – you needed a 20% down payment, great credit, and stable income.
Today, you’ll find mortgage loans with no down payment requirements, streamlined documentation needed, and even loans for borrowers with bad credit. There are more loans for people from all walks of life.
Refinancing is Made Easier
Many homeowners want to refinance, especially in today’s low rate environment, but they don’t know what’s available to them. Enter fintech and the vast number of opportunities at each homeowner’s disposal.
It’s easier than ever to check your options without talking to a loan officer. Without the pressure of someone telling you what’s best for you, it’s easy to make your own decisions, deciding if refinancing is right or not.
Fintech Makes Mortgage Lending Easier
The bottom line is that fintech makes mortgage lending easier than ever. Whether your borrowers are rate shopping, looking at different programmes, or just want to complete the process fast, fintech helps.
With most of the process done online, borrowers can close in less than 30 days in some cases, rather than the 45 – 60 days traditional loans take. Dealing with a computer is a lot less stressful than talking to a person about your finances and dealing with the back and forth of exchanging paperwork.
It should be interesting to see where fintech takes the mortgage industry, but if today’s numbers are any indication – it may help in a big way.