Homebuyers embrace digital lending in COVID-19 era, according to Finastra survey

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Financial institutions underestimate consumers’ demand for speed in the mortgage process

New research from Finastra shows that while rates remain consumers’ key driver in the mortgage lender selection process, trends relating to COVID-19 have put increased importance on digital experience and time-to-close. The pandemic has an influence on both trends, as consumers demand more robust digital loan processes and surging volumes of mortgage applicants extend time-to-close.

In a survey of 301 consumers and 34 financial institutions, conducted in July and August 2020, these surveyed groups provided their views on expectations around the mortgage process and insight into how consumers select their lender.

“Our survey results confirm that the pandemic has had an immediate impact on the mortgage industry that will continue to reshape the market for months to come,” said Steve Hoke, General Manager, Mortgage, Origination and Analytics, Finastra. “How financial institutions respond now will determine their competitiveness as consumers adopt a more virtual lending model.”

Seventy-three percent of consumers select their mortgage lender based solely on interest rates but acknowledge time-to-close is the biggest problem. Due to historically low rates and increased volumes resulting in part from the pandemic, the average close time is getting longer. Your ability to compete on close time could protect and even expand your mortgage business.

Download the full report based on these survey findings.

Download survey results