One of the most notable changes to the new MISMO 3.4/URLA is the ability to list several income sources. This necessary update was due to the emerging “gig economy” –a new financial structure influenced mainly by millennials. But this isn’t the only way that millennials are changing the mortgage process.
As millennials head deeper into adulthood and rise as a powerful force in the real estate market, the mortgage industry must adapt to their digital-first needs and expectations.
Here are three of the most prominent ways that millennials have altered the mortgage process.
Financial Institutions: Brick-and-mortar is Out; Digital-first is In
Digital-first banking alternatives are well on the rise and increasingly popular with millennials. Interestingly, this shift is not only influenced by a preference for digital banking but also due to a general skepticism about mega financial institutions. One can even make a strong argument that the demand for an alternative lender partially led Rocket Mortgage’s initial success.
Need more convincing that traditional banks have lost consumer’s trust? About 71% of millennials admitted that they would rather visit their dentist than listen to a financial institution.
Just like low trust is driving millennials away from traditional lenders, so is their slow digital transformation.
According to Microsoft’s research, 80% of millennials decide to patronize a business solely based on whether they provide a dedicated mobile portal. And according to Bankrate, millennials are 3x more likely than baby boomers to utilize their smartphone for financial services — including applying for a mortgage.
Given these facts, small to mid-size lenders would be wise to employ a digital transformation to become more transparent and up-to-date with modern lending behaviors.
Engagement Shift Between Millennial and Financial Institutions
It’s no secret that using a smartphone for phone calls is not as popular as texting, video chatting, or sending recorded voice messages. Memes even humorously depict this phenomenon with people waiting for the phone to stop ringing so they text the caller back immediately afterward.
And just like the saying goes, within every joke is a grain of truth —millennials indeed prefer other means of communication rather than traditional phone calls.
That’s not to say that live human interaction is any less valuable (we’ll explain this point further in the next section). Instead, millennials see other forms of engagement as more effective, especially when interacting with businesses.
Thus, we now see the rise of instant messaging, emails, video calls and even direct messaging through social media as the primary form of communication in lending. Automation through chatbots and autoresponders can assist with meeting this millennial preference.
Parallel Mortgage Process –100% Online + Loan Professional On-Hand
One of the most surprising ways millennial consumers are changing the mortgage process is that they want the best of both worlds –digital and human. They want a parallel journey that is seamless and 100% online but with trusted mortgage professionals ready to provide personalized concierge-level assistance.
That’s why over 90% of prospective millennial borrowers will research the mortgage process and compare local lenders before applying for a mortgage. These mortgage shoppers are looking for a digital-first lender with the service and brand they can get excited about.
The Mortgage Platform That Exceeds Millennial Expectations
Millennial consumers expect a lot when it comes to a digital mortgage experience. And while most lenders are still struggling with their digital transformation, some aren’t.
The difference? Implementing a digital mortgage platform from LenderHomePage.
From the get-go, we set our sights on designing the most intuitive mortgage software available in the market –an agile platform that conforms to emerging technology and changing compliance while adapting to the digitally-minded consumer and the needs of your organization.
Our 100% configurable digital mortgage platform includes Mortgage Websites, Loanzify Mortgage Mobile App, and Loanzify POS Pro+ or Lite. Choose your perfect combination of software tools, confidently integrate them with your 3rd party loan servicers, and engage with your millennial consumers in a comprehensive omnichannel digital mortgage platform. Not only will you exceed their expectations, but you’ll leave mega lenders bumbling as they try to catch up.
Curious what else we can do for you? Learn more here.