The right platform can help you gain market share by engaging consumers like never before.
Following a remarkable year for total mortgage originations — at $2.0 trillion, 2019 will boast the market’s strongest performance since 2007 ($2.31 trillion), according to the Mortgage Bankers Association (MBA) — the 2020 housing market is poised to be a bright spot in the economy once again. It won’t remain exactly the same as 2019, however: home purchases are predicted to comprise a larger portion of the market.
Although MBA forecasts a slight overall decrease, to $1.9 trillion, purchase originations are expected to rise 1.6 percent to $1.3 trillion. The slowdown is expected to come on the refinance side, which isn’t surprising given that refinances spiked 47 percent year-over-year in 2019, to $789 billion, according to Freddie Mac. That level of activity isn’t likely to be sustainable, particularly in the second half of 2020, says MBA, which looks for about $599 billion in refinance originations. (Freddie Mac offers a more optimistic forecast of 2020, with $785 billion in refinance originations, contributing to total mortgage originations of $2.1 trillion.) Despite the reduction in refinance volume, increased purchase volume promises to keep lenders busy.
In a purchase-dominant market, the speed with which loans are closed and the experience for all involved—chiefly the homebuyer—are critical. Matthew Woodhouse, managing director of Valuations at ServiceLink, says that lenders will be focused on becoming more efficient in the new year. “Lenders will be looking to contain costs by closing quickly and streamlining the entire mortgage lending process,” he says.
Technology is key, Woodhouse continues, for its capacity to not only tighten up the process but also engage home-buying consumers with an experience that feels familiar to them. Home financing is often viewed as unpredictable and lengthy. In fact, about 40% of Americans say buying a new home is the most stressful event in modern life, according to a survey from Homes.com. Engaging consumers in a way that is familiar to them – through technology – can make the experience significantly less stressful.
“Consumers, and particularly millennial consumers, now expect technology in nearly every aspect of their lives — adopting digital banking services that enable them to deposit checks from their phones and transfer money to anyone in the world at the push of a button, for example. They expect the same level of ease and self-service when they buy a home,” he says.
As millennials become the driving force in mortgage originations, the need for consumer-facing technology becomes more apparent. A recent Realtor.com analysis revealed that millennials as a generation now account for the largest share of new home purchases by not only the number of loans originated, but also by dollar volume. They hold a 42-percent share of new home loan volume, followed by Generation X at 40 percent and baby boomers at 17 percent. Stabilizing home prices in the coming year are expected to continue attracting first-time homebuyers in this group. Plus, as the largest cohort of millennials will turn 30 in 2020, they will have accumulated more buying power and be looking beyond starter homes to higher-priced properties.
One Platform for Both Purchase and Refinance Transactions
Meeting consumers’ expectations for a convenient home buying process begins with the right technology — a platform that ushers them through the mortgage process seamlessly, whether they are buying or refinancing. Phillip King, vice president and principal product manager, EXOS Valuations, explains how the EXOS platform makes the process faster, easier and more transparent for consumers, real estate agents and brokers, appraisers and signing agents.
“The EXOS platform takes the consumer from application and materials submission through appraisal and closing,” says King. “By giving the consumer or their agent the capability to schedule an appraisal at their convenience, rather than having to wait for a call or email from the appraiser, lenders can cut days from the process. This is particularly true where an agent is involved, because they are motivated to act quickly. It’s in their best interest to get the appraisal underway as soon as possible.”
ServiceLink has found that when real estate agents use EXOS technology, it can cut nearly 30 percent from processing times, Woodhouse adds. “We fully support agents’ use of our platform. In fact, we offer them the capability to view multiple loans across multiple lenders. Every time they access the EXOS platform, they can see all of the properties they are representing,” he says.
Access to the platform is easy for all users through either their browser or the EXOS mobile apps developed with each user in mind:
- EXOS Scheduling gives consumers and their agents the ability to schedule appraisals and closings at their convenience
- EXOS Valuations equips appraisers with a personalized calendar, real-time notifications and other tools to bolster their productivity
- EXOS Signing Agent provides signing agents with scheduling capabilities as well as an overview of orders in their pipeline
According to Homes.com, 44% of buyers feel nervous throughout the homebuying process. EXOS gives consumers and their agents more transparency into the additional portions of the homebuying process. This increased visibility allows agents to better serve their clients. For added security, agents receive their appraiser’s name, contact information, photo and make and model of their vehicle prior to the appointment. Additionally, EXOS integrates educational information throughout the process – so the consumer is informed every step of the way. EXOS improves client satisfaction in purchase transactions: ultimately leading to referrals and return clients.
“Everyone involved has a clear view of the process,” says King. “Most importantly, the homebuyer is engaged from start to finish. When we set out to design the EXOS platform, we saw that a lot of front-facing websites were enabling consumers to complete an application and upload materials online; unfortunately, the digital experience ended there. We committed to keeping the experience going — a cool, easy, one-touch kind of experience consumers appreciate. EXOS is connecting consumers to lenders on a whole new level.”
To discover more about how the EXOS platform creates a seamless consumer experience, visit exostechnology.com.