Millennials are all about being quick and efficient; They don’t waste time filling out handwritten paperwork or writing letters anymore. This is mainly due to the fact that they’re more accustomed with the digital era than, say, the Baby Boomer generation. The same idea goes for buying a house; they won’t want to waste time putting pen to paper on a 1003 application, driving to and from a mortgage office and their bank hunting down documents.
According to the National Association of Realtors, Millennials make up thirty-six percent of today’s homebuyers to be exact. More specifically, sixty-five percent of these buyers were first-time homebuyers. This number will only continue to grow as more move on from rental properties. Due to the increasing number of Millennials who are buying homes today, it is critical for lenders in the mortgage industry to direct a large amount of efforts towards their demographic. As the number of millennial homebuyers grow, lenders need to be taking the necessary precautions to keep them satisfied throughout the home buying process.
With that being said, paper 1003 applications are fading into the background as homebuyers want something that’s almost instantaneous. Digital point-of-sale (POS) applications seem to be growing in popularity amongst homebuyers and lenders combined. Not only do they reduce operating and origination costs, but they require much less work.
With convenient loan portals on lenders’ websites, homebuyers are able to successfully submit important documents and communicate directly with their loan officers. This takes away the back and forth between the buyer and the bank. POS applications are also sometimes set up to only provide the borrower with questions that apply to them, allowing abandonment rates to significantly decrease, with lenders closing more loans. Thus, keeping lenders and homebuyers happy.
In addition, POS applications and mortgage websites will have to be mobile responsive because not all Millennials bother with having a desktop computer anymore. According to Statista, approximately 2.53 billion people have smartphones today. Some of these individuals feel that there is no point to own a computer when their smartphone has all of the same capabilities. They also want to be able to electronically sign documents online without making a wasted trip to the bank. In addition, it is imperative to have an automated verification system for things like assets, employment, and income, to make this process even easier. This is a big part of digital mortgages, as the consumers don’t want to do more than they have to. Therefore, a homebuyer must be able to apply for a mortgage whether they’re on the go or sitting right at home.
All in all, it’s important to remember that there’s going to be a point where Millennials and Generation X members, whose lives have revolved around electronics, engulf the entire mortgage industry. The time is now to start making the necessary changes in order to keep potential homebuyers pleased, before the system becomes too outdated. The world is changing all around us, and lenders are going to have to make every effort to keep up. Digital mortgages are what Millenials are really waiting for–quick, efficient solutions.
About The Author
Curt Tegeler is responsible for providing direction for action to all employees and business initiatives. Tegeler’s main responsibilities include communicating and implementing the company’s vision and mission; leading, guiding, directing, and evaluating the work of executive leaders; formulating and implementing the strategic plan; forming, staffing, guiding, leading and managing WebMax; evaluating organizational success; and represents WebMax in civic and professional activities.