With US and China trade talks, next year’s election, the stock market’s wild ride. So far, the second half of 2019 has had its share of turbulence. But the good news is, the lending industry is poised for continued growth, in part due to both a strong job market and the Fed’s interest rate cuts. With 2020 just around the corner, banks and credit unions can tap into the upswing by heeding these four critical mortgage lending trends.
FinTech Become Part of Mortgage Companies
FinTech gained substantial ground among mortgage lenders in 2019, and that trend is expected to continue to grow throughout 2020 and even beyond. In fact, FinTech companies raised a record-setting $40 billion in venture capital funding in 2018 alone — an increase of about 120% in just 12 months. These investments have allowed companies like NestReady to develop cutting-edge platforms aimed at simplifying the mortgage lending process for all stakeholders, including banks, credit unions, home buyers and agents. Lenders like West Community Credit Union are using NestReady to transform the home-buying process, building long-term relationships with agents and consumers.
Loan Officers Focus On Millennials
What’s driving the boom in FinTech? Experts say millennials are playing a big role. Comprising the age group from about 23 to 39 years old, millennials are currently the largest generation in the active workforce in the U.S., outnumbering the rapidly-retiring baby boomers. That means they also comprise the largest share of home buyers. That’s reason enough to develop solutions aimed at their wants. And considering millennials were raised entirely during the age of the internet and home computing, what millennials want are tech-friendly solutions that are convenient and simple to use. Banks and credit unions that develop products and services aimed at millennials are poised to increase their customer base now just now, but for decades to come. For most millennials, that means mortgage lending and other banking solutions they can find online and on their mobile devices, without needing to trek into a physical banking location.
AI In Mortgage Lending Processes
Artificial intelligence may seem like the stuff of science fiction, but the fact is, mortgage lenders have already not only felt its influence, but embraced its implications. Thanks to artificial intelligence and advanced data analytics, loan officers can spend less time screening loan applicants and poring over mountains of data, and more time developing leads and nurturing client relationships. Platforms like NestReady use AI to evaluate potential buyers and speed up loan processing times while still mitigating risk to the lender. That means loan officers can close more deals in less time without worrying about missteps that can increase the risk of defaults over time. Many lenders also use AI to help manage portfolios and to decrease the risk of fraud and identity theft.
Digital Mortgage Platform Expansion
With the drive toward a more mobile and a more customized experience, forward-thinking banks and credit unions are striving to implement digital technology at every level of their operations. That means an increase in training for existing employees, as well as new hires with advanced digital-related skills. To stay competitive, banking institutions needs to update their hiring and on-boarding practices, as well as look for new technology that can make the transition simpler. Platforms like NestReady are leading the way, with easy-to-use interfaces and scalable technology aimed at providing a more robust experience for lenders in addition to a great experience for customers.
Mortgage Lending Trends To Prepare For With NestReady in 2020
At NestReady, our white-label solutions integrate all aspects of the home-buying journey, providing a simple, seamless way for lenders, buyers, and agents to interact throughout every stage if the process. The result is an experience that’s richer, easier, faster and, perhaps most importantly, more satisfying for everyone. If you’re ready to learn how our digital platform can help you grow your lending business, visit our site to schedule your free demo today.