Did You Know Technology Can Simplify the Mortgage Pre-Approval Process?
You may know that securing mortgage pre-approval requires you to provide a plethora of documents that outline your financial history and stability, but what if you no longer needed to kill a forest-worth of trees in the process? Thankfully, the days of printing off and lugging around your bank statements and tax reports are long over. Let’s look at how technology is simplifying the process of getting a mortgage in 2022.
What Prompted the Shift in Mortgage Technology?
We’ve seen many unprecedented events unfold in the past two years, and it would be silly to think that the mortgage industry has been unaffected. With many professionals working virtually at the beginning of the COVID-19 pandemic, there had to be a way for prospective homeowners to hand off their documents without having to do so in person.
Joe Tyrrell, president of ICE Mortgage Technology, reflected on this technological shift in an interview with Forbes: “ brought our industry a perfect storm. You not only had COVID, which required lenders to shift to virtual workforces, but you also had to continue to conduct business in a safe and socially distanced way with borrowers, all happening at the same time that we were experiencing a historical increase in loan volume.
“This caused many lenders to re-evaluate their technology partners, how they were leveraging technology, the systems that they employed, and the tools that they relied on. We heard many stories from our lenders across the country that had to completely and permanently shift the way they served borrowers.”
There are many benefits of using technology in the mortgage industry for lenders and borrowers alike. Not only is data entry minimized, but closing time has been reduced, and the entire mortgage process has been simplified.
How Does Mortgage Technology Help Borrowers?
Before the move to digital processes, lenders were splicing together a mix of digital and in-person options for borrowers. This methodology proved to be more confusing than helpful and highlighted the need for a single consistent digital experience for their clients.
Now, you’re able to do everything related to your mortgage within online portals and accounts. Mortgage services like Rocket Mortgage allow you to digitally:
- Apply for a mortgage online
- Upload the required documents
- Sign paperwork for your lender electronically
- Get approved for your mortgage
- Close your loan
- Make payments on your loan
Pro Tip: Curious about the documents you’ll need to submit when heading into pre-approval? Check out this ebook outlining everything you need to know about mortgage pre-approval.
The above processes once demanded a good chunk of time, but electronic alternatives have sped up the timeline and are quickly becoming the baseline for borrowers looking for pre-approval. In a 2020 survey conducted by Ellie Mae, it was revealed that:
- 60% of lenders who offer online applications said more than half of all loan applications are submitted online
- 61% of borrowers used an online application in 2020
- 61% also used an online portal for electronically signing and notarizing documents
- 91% of lenders offer online applications to borrowers
If you’re a traditionalist and feel more comfortable submitting paper documents to your lender, don’t fret. Working with a lender in person will continue to be an option for those who prefer it, but for everyone else, the future is now.
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