Homebuyers Expect Digital Mortgages, But Also Want Human-Touch Communication, 2018 Ellie Mae Borrower Insights Survey Finds
Second Annual Survey of Homeowners and Renters Reveals Preferences Among Millennials, Gen Xers and Baby Boomers; What's Keeping Renters From Buying; And More
The survey also found that the concept of a digital mortgage starts before and extends beyond the application process. Nearly one-third of all homeowners surveyed (31 percent) said they conducted mortgage research online before they applied. In fact, one-in-five homeowners (21 percent) found their lender through an online search. Following the application, 19 percent of homeowners used an online resource for loan origination and eight percent used one after closing the loan.
|How would you define a digital mortgage?|
|Millennials||Generation X||Baby Boomers|
|My lender has a website||45%||46%||47%|
|My lender lets me fill out my mortgage application online||52%||54%||61%|
|I can eSign documents||52%||53%||64%|
|I can shop for rates online||42%||46%||51%|
|I can upload documents electronically||43%||47%||58%|
|I receive status updates as to where my mortgage is in the process||39%||42%||50%|
|I can collaborate with my lender via a portal||32%||35%||43%|
|My lender offers electronic closing||32%||37%||46%|
The use of online tools cut across all generations. Seventy percent of Millennials used an online application process for all or some of their last mortgage, as did 55 percent of Gen-Xers and 43 percent of Baby Boomers. Homeowners who used an online application overwhelmingly felt it improved their experience (93 percent).
Interestingly, even though Millennials were most likely to use technology, they were also the most likely group of homebuyers to want more interaction with their lender. More than one-third of them (37 percent) said more face-to-face interaction and more communication with their lender would have improved their last mortgage application experience.
"The trend toward online is a great opportunity for mortgage lenders,"
What's keeping renters from buying?
The Ellie Mae Borrower Insights survey also explored what is keeping renters out of the housing market. One of the biggest reasons is a misconception about what it takes to qualify for a mortgage loan.
More than one-third of all renters (36 percent) say they are doing so because they have not saved enough money for a down payment. In fact, more than half of Millennials (52 percent) cite the lack of a down payment as the biggest factor preventing them from buying a home.
While it's true some renters may not have enough money saved to purchase a home, the survey identified an opportunity to educate renters about what is needed to qualify for a mortgage loan today. For instance, almost half (49 percent) of all renters believe they would need a down payment of 20 percent or more. One-in-three renters (34 percent) think they need a credit score in the 700-749 range and another one-in-three renters think they need a credit score in the 750-799 range.
"Surprisingly, almost half of the renters surveyed said that they thought they needed to put down a larger down payment than necessary to be able to purchase a home," said Tyrrell. "With the range of loan products available today, including FHA loans, this simply is not the case."
Ellie Mae surveyed 3,006 individuals between the ages of 18 and 70 using
the Qualtrics Insight Platform and a panel of homeowners and renters
provided by Qualtrics panel services. The survey was fielded from
News organizations have the right to reuse this data, provided that
About Ellie Mae
Source: Ellie Mae