Technology advancements have elevated consumer expectations in home lending, while higher interest rates and reduced demand have also shrunk the pool of clients for mortgage lenders. The result is a more competitive business environment. Potential borrowers are looking for faster speeds and an easy-to-understand process, and mortgage companies need to find a way to deliver to keep profits up.
What the consumer wants based on their familiarity with digital transactions elsewhere, though, doesn't necessarily correspond to what the mortgage industry feasibly can — or should — offer. A mismatch exists between expectation and current capabilities, something which could be remedied through better communication. Consumers today want to be clued in as they go through the mortgage process, and still value personal service, even as the transaction increasingly goes digital.
In this research from Arizent, recent mortgage borrowers share views of the lending experience and provide hints about what the home lending industry does well and pain points needed to be fixed.
The key findings in this report include:
- How quickly consumers think the mortgage process should take
- What borrowers find most challenging or confusing when obtaining a mortgage
- Mortgage customers' preferred method of communication with their lenders
- The upper threshold mortgage rates can go before consumers will abandon their purchase or refinance plans
Why read this report:
The mortgage industry is undergoing a period of normalization and recalibrating expectations following an exceptional and somewhat unexpected period of growth in 2020 and 2021. The conditions that brought lenders to great profitability were unique, however, and highly unlikely to occur again. As volumes come down to earth and interest rates rise, mortgage lenders need to better understand their consumers to remain competitive.