More than half of consumers said they preferred to apply for a mortgage loan online.

While rates remain the main reason why consumers select a particular residential lender, pandemic-induced trends have put increased importance on digital experience and time-to-close. Ultra-low interest rates are swaying many hesitant buyers into the market, according to Finastra’s survey of 301 consumers and 34 financial institutions. Around 73% of the consumer respondents said they chose their lender based solely on interest rates. Dan Putney, managing director at Finastra, said that people who initially were looking 12 to 24 months out to buy "fast-forwarding their decision based on the ability to lock in on historic low rates." The survey also revealed that existing relationships with either a financial institution or an individual loan officer were the second and third most common reasons consumers opted to work with a lender. However, many financial institutions reported that modernization is upstaging loyalty, with 57% of lenders saying that they are witnessing consumers turn to lenders offering an easy application. That was true for more than half of consumers who said they preferred to apply for a mortgage loan online. Time-to-close is one of the biggest problems in the lending process, according to Finastra. The survey showed that the majority of consumers wanted to close in 15 to 30 days, with 37% expecting an unrealistic timeline of three to 15-day time to close.

Source: Mortgage Professional America