When Quicken Loans introduced Rocket Mortgage in a 60-second commercial during the 2015 Super Bowl, Bill Emerson had to convince regulators that digital mortgages wouldn't create another financial crisis.
"I can't tell you how many folks I had to go talk to in Washington, D.C., to try to explain what was really going on here," said Emerson, the vice chairman of Quicken Loans and its parent company Rock Holdings Inc. "That the world wasn't going to end again. That we were really just taking the current underwriting model and making it simpler and easier for human beings. That we created a better, safer and simpler process for everyone to participate in the mortgage space."
Emerson also had to defend himself to industry insiders.
"If I had a dime for every time that someone told me while we were at an industry event that we were crazy for having a centralized model, for not having feet-on-the-street loan officers. If I had a dime for every time someone told me that, 'Wait till rates go up, wait till the market shifts, you guys won't be around anymore,'" Emerson said.
Emerson asked mortgage lenders at Digital Mortgage 2018 in Las Vegas to think like technologists and give their employees at least one hour a week to consider how they can innovate and change how they do business.
When Rocket Mortgage began, around 9% to 10% of customers were coming to Quicken Loans through the application. Now, 98% of Quicken's customers come to the company through Rocket Mortgage. Two-thirds of those customers want to buy a home and 70% of them are first-time homebuyers.
"There are people today that will buy a house without walking into it. Not many, it's still early, but the technology exists for people to see these homes go through with a video tour," Emerson said. "Ninety to 95% of people start their home search online, similarly with the mortgage process. If we're not thinking about how to integrate those two things then the consumer of today and tomorrow will disintermediate us for the people who are doing that."
With the average age of millennials being 29 and the average age of first-time homebuyers being 32, mortgage lenders need to be actively evaluating the millennial generation, Emerson said.
"This generation hasn't even gotten to the place where they are going to start transacting," he said. "Yet this is a generation that cares about simplicity, ease and does everything they can possibly do on their phone."
The generation behind millennials will require even more digital tools, including gamification.
"I was at the meeting the other day and the concept of e-sports came up," Emerson said. "People literally go to watch people play a game on a screen. It's a whole different landscape and a whole different world, and we have to get our brain around that."
