Ellie Mae Survey Uncovers How Technology Is Changing the Mortgage Lender and Borrower Experience

Technology has changed nearly every aspect of the mortgage industry, from how lenders generate leads to how borrowers complete an application. The 2019 Ellie Mae Lender Insights Survey uncovered important insights about how online and mobile tools have reshaped the overall homebuying experience and lenders’ and buyers’ expectations of each other. Ellie Mae is the leading cloud-based platform provider for the mortgage finance industry.

“An important theme we uncovered in this study is that borrowers expect choices,” said Ellie Mae Chief Operating Officer Joe Tyrrell. “They want access to multiple digital tools that they can access from any device, including an easy to use online portal to make the application and document upload process more seamless. Lenders need to make sure that their loan officers are using the tools that customers want and educating borrowers about their benefits.”

Despite tight housing inventory across the United States, 41% of the lenders Ellie Mae surveyed reported an increase in loan volume from 2017-2018.

As their businesses have grown, many lenders have invested heavily in technologies to accelerate and improve the mortgage experience for borrowers. For instance, an overwhelming majority of lenders (93%) now offer online applications and online portals where borrowers can submit documents electronically. Nearly half of lenders (49%) offer borrowers a mobile app experience – and among those that do, more than half (54%) saw their loan volume increase by 5% or more.

However, the survey found that simply providing digital tools to borrowers isn’t enough. A majority of lenders reported that, on average, 50% of their online applications were started but never completed.

But technology applied poorly can actually cost lenders business. About one quarter of borrowers who start an application online end up completing it via a different channel. Nearly 60% of those borrowers say they abandoned an online application because they felt it took too long. One out of five borrowers who abandoned an online application wound up choosing a different lender.

“It’s clear that lenders are leaving revenue on the table by not converting more leads into closed loans and not providing the kinds of online and mobile experiences their borrowers want and their loan officers need to stay updated in real-time,” Tyrrell said. “Digital solutions that allow lenders to flag abandoned applications and intervene appropriately can result in more efficient communication with borrowers, better-managed pipelines and increases in loan origination and completion.”

Digital Offerings Influence Expectations

Ellie Mae also found that the widespread availability of new technology-based capabilities and workflows has changed both lenders’ and borrowers’ expectations of each other.

The Ellie Mae Borrower Insights Survey, released earlier this year, found that half (50%) of borrowers chose their lender based on whether they offered an online application or portal. Similarly, 47% of borrowers said access to an online portal for uploading documents electronically factored into their decision about which lender they chose.

Lenders now expect borrowers to complete their loan applications faster because of the digital resources they provide. Eighty-five percent of lenders believe borrowers should be able to complete a mortgage application online in less than 30 minutes.

The availability of online and mobile technologies is also impacting how – and how often – borrowers and lenders feel they should be communicating with each other.

Ellie Mae found that over one-third (37%) of lenders believe one of the main ways technology improves the mortgage process is to reduce or eliminate the need for face-to-face meetings. However, the Borrower Insights Survey found that, among borrowers who were offered online applications but opted not to use them, almost half (47%) said they prefer to work directly with a person.

Many lenders feel they communicate enough, or more than enough, with their borrowers. One in four (25%) lenders reportedly contacted borrowers between one and five times during the mortgage application process.

While borrowers recall being contacted more often – 38% say between one and five times during the loan process – many, especially millennial borrowers, felt that amount of outreach was insufficient.

“Mortgage automation should be seen as a tool to help improve the lender-borrower relationship by offering a more customized, high-tech and high-touch form of service, depending on the individual borrower’s needs and preferences. Not recognizing and accommodating these preferences could cost lenders business as borrowers may choose a competitor that offers the kind of experience they want,” Tyrrell said.

To download the Ellie Mae Lender Insights Survey eBook, and for more information, visit https://explore.elliemae.com/lender-survey-2019

About Ellie Mae

Ellie Mae is the leading cloud-based platform provider for the mortgage finance industry. Ellie Mae’s technology solutions enable lenders to originate more loans, reduce origination costs, and shorten the time to close, all while ensuring the highest levels of compliance, quality and efficiency. Visit EllieMae.com or call 877.355.4362 to learn more.

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