The Questions Every Lender Must Ask

As more and more young Americans look at buying a home, lenders are faced with new ways of approaching the buying process to ensure that first-time homebuyers have a seamless mortgage origination experience. At a webinar on Monday, Joe Tyrell, EVP of Corporate Strategy at Ellie Mae, gave insights into the latest research on the divide between homebuyer demands for transparency, speed, and a high tech - human touch process and how it compared to the lenders' view of consumer engagement.

Starting off on what consumers looked for today, Tyrell said that Ellie Mae's survey of around 3,000 homebuyers who had just completed the mortgage process found that 92 percent of respondents began their homebuying process with some type of online research. A huge jump compared to just "50 percent who went online five years ago," according to Tyrell. Additionally, he said that 72 percent of the respondents looked for the best rates on offer and 59 percent looked for how much loan they could qualify for online.

"If you ask any lender what their competitive advantage is, most of them do not say it's our rates, our loan programs," Tyrell said. "Typically what we hear from lenders is that they tell us it is customer service. That’s how they differentiate their ability to compete in the marketplace."

Having said that, Tyrell asked that how did lenders who were rushing online to engage with customers actually make sure that this was what the customer also wanted?

When Ellie Mae had asked the respondents during the survey what was the No. 1 thing that lenders could improve in the mortgage origination process, the answer, especially by millennials, was, "make the process go faster." The second-most-important reason given by the respondents, however, was more surprising, Tyrell explained. "It was to have more personal interaction with their lender," he said.

So in that case, how could lenders engage with their consumers in a high tech human touch way?

"It really starts with asking yourself as a lender three basic questions," Tyrell said. First, he said, lenders must ask how they were creating interest. It could include channels such as buying leads, sending emails, and counting on the loan officers to bring in the business.

The second question, according to Tyrell, was how could lenders engage consumers once they responded to the interest created by them? And third and most important was "what is your strategy to cover 1oo percent of those people who expressed interest and are willing to engage?"

It was by asking these questions, that lenders could take the help of a true digital mortgage experience, which personalizes the importance of balancing personalized communication with automation, using data and analytics to engage more borrowers, and create solutions that drove effective engagement to close more loans.

Click here to view the webinar.