The world of technology is constantly evolving, now faster than ever. This is resulting in great advantages for all kinds of businesses, and their customers alike. However, there are certain sectors that are slow to adopt new technologies due to a fear of change, lack of buy-in, or a variety of other reasons. The real estate and mortgage sectors can definitely be seen as industries that shy away from technological innovation, but it’s time for this to change.
Each step in the mortgage process can be extremely time consuming for both the borrower and the lender. So, what can technology do to make this process more efficient?
Technology that adds a degree of automation to the mortgage process that can eliminate the need for loan officers and borrowers to perform mundane, repetitive tasks. This can save a lot of time throughout the process and get mortgages approved quicker.
For example, instead of having to manually track mortgage customers and their credit ratings, tools like Sales Boomerang automatically notify brokers when a prospect’s credit rating has improved enough to qualify for a mortgage. It can also send out a notification when a past customer is in the market for a mortgage or is selling their home (here’s more about how it works).
On the other end of the spectrum, even the 800-pound gorilla, Fannie Mae, uses automation in their underwriting and has more recently added trended credit data into their mortgage approval process.
Loan officers must be one of the few groups of people that still use a fax machine. They’ve become practically obsolete, so why does the mortgage industry still rely on them so heavily? Scanning and faxing documents can be a huge hassle, so moving towards an electronic document management system (EDMS) is the sensible way to improve efficiencies. Digital signatures can even be added to documents to reduce the number of face-to-face meetings required.
With solutions ranging from simple electronic signatures to taking the real estate process entirely digital, DocuSign is one solution provider that sees the industry’s need for going digital.
Systems such as Habito and Trussle allow you to receive accurate mortgage advice after having a conversation with a machine online. This kind of technology, known as chatbots, has a lot of promise when it comes to making the mortgage process more efficient, supplementing human activity rather than replacing it. This technology learns through its encounters with customers, meaning it improves giving accurate advice with time.
Another example is Emma, a chatbot from Singapore’s OCBC bank. Emma responds quickly to customers’ inquiries and uses AI that replicates natural human conversation. She can also make calculations based on information provided by customers to help give more detail about their chances of getting approved for a mortgage.
Since launching in January 2017, Emma had already responded to 40,000 inquiries by the end of June 2017. Of course, she has her limitations, but she can also pass you onto a human advisor if you prefer some real human interaction, or if your inquiry is beyond her capabilities. When handed off to a real advisor, that employee will be provided with a log of the conversation you had with the bot, so they’re aware of all the information already shared.
As the mortgage process becomes quicker due to the adoption of technology, real estate agents also need to be up to date with the latest technological innovations in order to keep up.
Real estate agents can use technologies such as chatbots and automated systems in the same way as loan officers to help improve their efficiencies. Tools such as CRMs and scheduling apps can help to speed up the process and provide customers with the best possible service.
Virtual Home Viewings
Another emerging technology that could signal big changes in this industry is virtual reality. Imagine you’re looking for a new home in a different city or country. Arranging travel, time off work, and any other necessary arrangements to view a home is a lot of hassle. All of this for a home that you might not end up liking once you see it. Real estate agents could utilize virtual reality to help solve this problem.
Leveraging virtual reality technology, a potential buyer could take a tour around the house from the comfort of their own home. They might not be willing to make a final decision based on this, but it could at least let them decide if the home is worth making the trip to view in person or if they can cross it off their list. This is what Sotheby’s was thinking when investing in virtual reality.
What this Means for the Consumer & Agents
Through all of these technological improvements to the real estate and mortgage sectors, the customer serves to save time and money as well. Artificial intelligence and the like could save the lender a great deal of money across managing the whole process – paying employees, quicker communication, etc. These savings can then be passed onto the customer as decreased fees, for example.
Ken Bartz, co-founder of Sales Boomerang and CEO of Monster Lead Group believes that machine learning “will effectively make lending cheaper and easier for the consumer.”
So, while artificial intelligence and machine learning may be slightly daunting terms, they could be a huge boost to the real estate industry as a whole, since a major driver in the real estate market is the cost of borrowing, and when rates are lower it leads to additional home sales.