Why speed matters when it comes to mortgages.

Business is all about creating efficiencies — both for the customer and the organization itself. When you’re efficient, you get more done, you solve more problems, and you have happier customers. 

This is never more true than in the mortgage industry. Most lenders are able to offer similar mortgage rates, but getting the buyer to the closing table quickly is where they set themselves apart. A borrower who can complete the financing of their mortgage can help win bidding wars and allow them to compete with cash buyers and institutional investors.

Yes, speed matters. Especially when it comes to mortgages.

Speed, efficiency, and customer service

When you’re applying for a loan, your loan officer’s team will tell you how long the process will take and how many touchpoints it will require. Many of those expectations are measured in terms of transaction speed. 

For example, pre-approvals can now be issued not only on the same day, but within hours or even minutes. This means you can attend an open house at 10:00 a.m. and make an offer on that same property by the afternoon — a credible offer that demonstrates verified purchasing power.*

That’s not just accelerating the first step in approval, that’s turbocharging your lending experience so you can connect with sellers early on in the process — before the bidding wars begin. In today’s hypercompetitive housing market, early, proactive pre-approval can make all the difference. 

Processing: the delay factor

Without the aid of expert teams and powerful, however, error-reducing digital technology to speed things along, that life in your new home could be delayed. Mistakes can occur — costly processing mistakes that could jeopardize your closing date or even your purchase deal with the seller. 

A faster mortgage process

Historically speaking, there’s no denying that obtaining a mortgage hasn’t always been the quickest or easiest of processes. For decades, there seemed to be built-in frictions that consistently slowed the process down. 

As a borrower, you no longer have to settle for a “business as usual” approach. You have options. Lenders who embrace change in the form of cutting-edge technology, streamlined processing, and improved communication have begun to separate. Turn times and speed matters to agents and sellers and superior customer service always has the last word with buyers.

A digital world = digital expectations

Think about how e-commerce has evolved over the past decade or so: You pay your bills online, have your groceries delivered with a few simple clicks, and can order big-ticket items like cars and motorcycles online. If the rest of your purchases are defined by a seamless, digital experience, why would you settle for anything less when it comes to your mortgage? 

Digital Mortgage and real-world impact on loans

To meet consumer demands for greater speed and efficiency, many lenders are adopting innovative technology platforms that help process your loan more quickly and seamlessly. According to a 2018 report from the Federal Reserve Bank of New York, Mortgage providers with “fintech,” or financial technology, capabilities close loans 10 days faster than those who lack this technology. 

Fast, flexible, secure, and available as an app, Digital Mortgage has proven to be a game-changing platform for loan applications and pre-approval, integrating with automated underwriting system (AUS) software. Faster pre-approval means greater insight into purchasing power and more negotiating strength when dealing with sellers. 

Introducing speed into the process

As illustrated above, pre-pandemic a number of savvy lenders were beginning to create an application process around cloud-based digital technology, but it’s become increasingly commonplace — first and foremost because borrowers are demanding it. 

Underwriting, automation and moving things along

Arguably the most important step on the road to closing your loan is the underwriting portion of your mortgage experience. This is where information regarding loan approval is examined, weighed, and vetted — and it can be time consuming. An underwriter looks into your creditworthiness, scrutinizing your financial history and profile including income, assets, liabilities, employment history, collateral, and more.

By incorporating the bold advancements of artificial intelligence (AI) and machine learning into mortgage processing, lenders are creating integrations and efficiencies that can be automated, saving mortgage providers countless hours on the backend that, in turn, can be passed along to the borrower.

While underwriters and their staff still play a vital role, this new, smart technology allows them to synthesize data from a range of parties — not just borrowers — more quickly and seamlessly, effectively eliminating errors, biases and bottlenecks attributed to an overreliance on manual labor, delivering you a next-generation mortgage experience.

Mortgages and the human touch

As much as we celebrate the time-saving breakthroughs of modern technology, make no mistake about it: The human-to-human dimension is still imperative in delivering speed and precision. A loan officer is there for a reason — to help set expectations, guide you through the process, and answer questions as you obtain the necessary financing to purchase your home.
 
While the verdict is certainly out as to what degree of involvement AI will play in the future of mortgages, experts still can make all the difference in the world.

A faster way to close 

In the last few years, lenders who offer end-to-end digital mortgages are introducing added speed and convenience into the closing process. For many borrowers, this has been a game changer, giving them speed and simplicity. 

A faster closing means no last-minute complications that could jeopardize finalizing the loan. It also means transformative convenience. In addition, many loans are dependent on co-signers, some of whom may not be in the same town let alone the same room. Digital closings solve this dilemma, right down to the online notary. 

Once a source of great anxiety, closings can now be conducted from your laptop or smartphone thanks to a seamless and secure process that allows you to finalize the loan agreement from almost anywhere in the country (or wherever else you happen to be).

Speed and mortgages: where do we go from here?

Like any other industry operating today, the mortgage industry will continue to evolve to serve you better and to be more efficient. As a homebuyer, you’ve doubtlessly become accustomed to doing many things online, including searching for homes and exploring neighborhoods, but the technological advances in the industry are not just to make life easier for you. They help speed up the financing process, to give you an advantage and hopefully allow you to win that bidding war and close on the home you really want. Faster, and with fewer headaches.