Qualify More Borrowers With a Top of the Funnel Digital Transformation

Digital mortgage applications have almost become an industry tables stakes. While some companies offer a digital solution to get prospects pre-qualified quickly, other companies have expanded beyond the initial loan application to provide an entirely digital mortgage process.

As mortgage lenders try to keep pace with this ever-evolving process and customer expectations, technology advancements have focused on the milestones towards the conclusion of their digital mortgage roadmap.

If delivering a digital mortgage experience is now the expectation of borrowers, particularly younger homebuyers, why aren’t more mortgage lenders offering a user-friendly digital solution at the top of the funnel to get their clients mortgage-ready?

According to a recent Fannie Mae survey1, about 38% of homebuyers did not shop around before selecting their mortgage lender. If a lender can capture these prospects in the early stage of their home buying process and stay top-of-mind, they will likely apply for a mortgage with that company.

Providing a digital solution that empowers borrowers to become mortgage ready at their own pace and can deliver an experience that will ultimately drive repeat business and referrals should be the new focus of every mortgage company’s digital mortgage roadmap.

FinLocker Levels The Playing Field

FinLocker provides independent mortgage originators, community banks, and credit unions with the same opportunity to get their borrowers mortgage ready as the mega banks and online lenders.

Smaller mortgage lenders and financial institutions are less likely to have the technology and marketing resources to nurture prospects through to close and engage with clients post-close to develop a relationship to retain their customers for life.

When a loan officer invites his/her customers to create a custom-branded FinLocker, they are taking the first step to invest in a long-term client relationship. Providing a customer with free financial tools to improve their credit score, help them budget, save for their down payment and closing costs, and reduce their DTI to get mortgage ready, will drive customer loyalty, resulting in higher funnel conversion.

FinLocker saves the lender from remembering to check in with each prospect regularly. When the customer has completed their goals, they can take a Readiness assessment in the app to let them know in a few seconds if they are mortgage ready.

The financial representative who provided the FinLocker invitation is listed as the contact in the customer’s FinLocker, so the customer can initiate a loan application directly from their app when they are confident they will meet the eligibility guidelines for their mortgage.

Be The Lender Your Borrower Wants You To Be

The majority of homebuyers responding to a Fannie Mae survey2 said that “gathering all the financial documentation is the most difficult part of getting a mortgage and that paperwork reduction is critical to making the process easier.” Borrowers who have grown up in a digital world now expect an Amazon-like experience, where their financial activities can be quickly and securely incorporated into subsequent transactions, including their mortgage application.

When a customer uses a FinLocker, they do not need to start from the beginning when applying for a mortgage. With instruction from the FinLocker Documents widget and their loan officer, borrowers can gather in advance loan documents, upload them to their FinLocker, and securely transfer them to their loan officer when they are ready to apply for a mortgage.

Decrease Risk

Manual processes are cumbersome and prone to human error. FinLocker uses consumer-permission data so users can select which assets, liabilities, and documents saved in their FinLocker are transferred directly to the loan officer for inclusion in their loan application. The documents are packaged as Mismo and Fannie Mae 3.2 file formats along with an Asset Report to speed up the loan application process and transfer to the lender’s loan origination system.

Gain Market Share

The average loan production is costing lenders $7,138 per loan in Q2 2020, according to the Mortgage Bankers Association3, so it’s not surprising that mortgage lenders are looking to reduce costs due to market compression and margin squeeze.

The consumer-permissioned data transferred from FinLocker helps lenders process mortgage applications more efficiently. Delivering mortgage-ready borrowers with documents and assets packaged for underwriting helps lenders close purchase loans and refinances quicker and gain market share.

FinLocker gives all mortgage lenders the opportunity to begin a quality customer interaction earlier in the home buying process than other marketing tactics. Issuing a custom-branded FinLocker app keeps the financial institution top-of-mind for the duration of the loan process and initiates a value-added relationship to create a customer for life.

 

1 Fannie Mae, Shopping Around for a Mortgage Pays Off for Consumers

2 Fannie Mae, What To Digitize First, According To Recent Homebuyers

3 Mortgage Bankers Association, IMB Production Profits Soar in Second Quarter of 2020