Becoming pre-qualified or pre-approved is the first step a borrower takes that provides traction in the home-buying process. Borrowers can browse as many houses as they want online, but until they have their financing in order, they’re just window shopping. The current pre-approval process most lenders employ relies heavily on loan officers manually updating pre-approval letters as requested. Like any manual process, there are inherent limitations and drawbacks that can ultimately result in lost deals.
Adjustable pre-approval mortgage technology can help lenders overcome these challenges and improve conversion rates. Here are three reasons why you should consider adding adjustable pre-approval technology to your tech stack:
Borrowers Want a Digital Experience
While NextGen homebuyers (millennials and Gen-Z) accounted for 45% of all homebuyers in 2021 and 32% in 2022, Baby Boomers grew from 29% of all homebuyers in 2021 to 39% in 2022. Despite a focus on improving technology for the younger generations of homebuyers, experienced homebuyers have also proven to be fans of technological advances.
Borrowers have become accustomed to convenient and tech-forward processes in their everyday lives. When was the last time you printed out directions to go somewhere? We know that at least 70% of today’s borrowers expect a personalized and technologically forward mortgage process and they want information that is dynamic in nature and can be delivered right to their phone. Pre-approval mortgage technology can deliver this from the beginning of the relationship between the lender and potential borrower.
QuickQual facilitates a customized, highly engaging digital experience for borrowers from the first point of contact.
Housing Market Challenges Demand Speed
The housing market is still tight in many areas of the country. Adding to the lack of inventory is reluctance by current homeowners to give up their current interest rate and purchase a new home at today’s much higher rates. When borrowers and their real estate agents do find a home, they must move quickly with as strong of an offer as possible, and that timetable may not always be convenient, or even possible, for the loan officer.
QuickQual functions as an extension of the loan officer, allowing borrowers and their agents to run payment scenarios and generate pre-approval letters on the spot so they can move as quickly as the market dictates. By setting parameters based on borrower’s maximum available down payment and approved amount, QuickQual ensures loan officers retain control of the pre-approval process and helps prevent borrowers and their agents from generating unrealistic pre-approval letters.
Every Prospect Matters
On the lender side, the drop in origination volume this year and interest rates at a 20-year high means loan officers are hunting for every deal. As borrowers conduct their home search, knowing the types of properties they are considering enables loan officers to make recommendations on the best loan product to finance each property. However, borrowers typically don’t share that information until they are ready to make an offer. In addition, as online applications, eSign and other digitally-driven process become table stakes for lenders, providing a seamless and tech-forward experience for today’s borrowers at the first point of contact can create a significant competitive advantage.
QuickQual gives lenders insight into the borrower's home search by tracking borrower/agent activity within the system. For example, lenders can review the purchase price of the homes the borrower is considering and how their numbers are stacking up again their pre-approval amount. These insights could enable a lender to better serve the borrower by presenting options of which the borrower may be unaware, ensuring borrowers can make the strongest offers possible and secure their desired home
Is your pre-approval process delivering the convenient, personalized experience your borrowers crave and differentiating you from your competition? Contact LenderLogix to see how QuickQual can transform your pre-approval process from “ho, hum” to “WOW!”
