Most everything we do these days can be accomplished with a stroke of a key from our laptops, tablets or smartphones. We can order groceries to be delivered, turn our thermostat on before we head home, or book our vacation.
And for quite a few years now, people have been getting mortgages or at least applying for them online. But is that a good or bad idea? Is this method faster or easier than meeting with a mortgage lender? And do you get better deal by doing it online? The answers really depend on someone’s personality and computer savviness, their preferences and what type of lender they select to do business with.
“The vast majority – about 90 percent of our customers –is applying online for convenience and simplicity, plus they have access to all the resources they need on our website,” says John Inzeo, vice president of the Wisconsin Mortgage Corporation in Brookfield, Wis. He also is serving a term as president of the Wisconsin Mortgage Brokers Association.
“But successful organizations that are using online systems recognize that you have to blend the convenience of technology with the warmth of the personal touch. Clients also want to know that they can hear a live voice and meet, if necessary, with a live human being who can guide them,” he says.
Online Mortgages End Up in a Real Person’s Care
Even the heavy hitter like Quicken Loans, the largest online lender according to National Mortgage News, eventually has a person show up at the closing. On its website, Quicken Loans talks about how its customers can choose to chat, email or talk on the phone with one of its home loan experts.
“We’ve got all the fancy-schmancy technology to make your mortgage experience one of the easiest things you’ll ever do,” the website says. “Our industry-leading online tools offer ease, speed and insight. That’s why we close the majority of our loans in 30 days or less.”
The industry standard of getting to a closing is about 42 days, according to mortgage origination software provider Ellie Mae.
Quicken Loans states — “When everything is ready and you give us the go-ahead, we’ll schedule your closing. Don’t worry about finding us – we’ll come to you. Home, office, coffee shop…you name it. Tell us where you want to close, and we’ll meet you there.”
So even though you might be doing most of your mortgage correspondence online, eventually you have to come face-to-face with a live, licensed person at a location to sign all the papers and get the keys to your new house.
Getting a mortgage in the last few years is a very complicated process, Inzeo admits after being in the business since 1977.
“That personal touch is critically important to get the buyers to the closing. To get to that closing, you have to define and navigate the journey, and that journey is much different than it was five years ago,” he says.
Dealing with a live lender either on the phone or in person can assist borrowers by talking them through all the reasons that all the documentation is needed and how it relates to getting the mortgage.
“We can give them the confidence because we know what we are doing. We will navigate for them. This is the most important financial event in their lives,” he says.
An Online Mortgage is about Convenience
But he agrees that less and less people want to sit down for two hours and watch a lender put their personal information into the computer. Online applications can take a person a lot less time to fill in the blanks, plus they can wear your jammies, be relaxed in your own home and drink a glass of wine while doing it, Inzeo says.
Doing online applications also is a blessing for those with different work schedules, who have small children at home and can’t get a babysitter, or those who just don’t want to make the drive to a lender’s office.
It’s also convenient because online loan applications can be submitted any time from any device from anywhere. But just be sure if you are in a Wi-Fi location and are putting in any personal information that the website and every page that you deal with are encrypted. According to the Federal Trade Commission, you can determine if a website is encrypted by recognizing the https at the start of the web address. The “s” stands for secure. Some websites use encryption only on the first, sign-in page. So remember to look for https on every page you visit, not just when you sign in.
Many online companies that help you find a lender use secure technology to ensure that the data you do send us is protected, confidential and secure.
Zillow Mortgage Marketplace even goes farther than that with security by telling its customers that it can help them shop for a mortgage without asking for any personal or contact information. Potential borrowers just give a few details about the loan they are looking for. Personalized rate quotes from its network of participating lender will be emailed back to them.
An Online Mortgage is More Efficient, Cheaper
Many people believe that online lenders give better interest rates on loans. But it all depends on someone’s credit score, the type of loan they are wanting, the term of the loan and a lot of other aspects that are considered when an interest rate is offered.
“From a lender standpoint, there is efficiency when people do their applications online on our website. There is a lot of information on there for them to help them through it,” Inzeo says. “If we are more efficient, we save money and can pass that on to our customers.”