Consumers across all generations, from millennials to baby boomers, want more online and digital communication with their mortgage lender, according to a survey from Velocify.
"The most interesting discovery was not how borrower behaviors have evolved, but where they are headed," Velocify President and CEO Nick Hedges said in a press release. "The trend line in our data shows that all borrowers, regardless of age, have a strong preference for more online and digital interaction with their lender."
Nearly half of the respondents that got their mortgage in the past year found their lender online, 48%, versus 13% who got their mortgage between five and 10 years ago.
By generation, 46% of the millennials, 42% of the Gen Xers and 32% of baby boomers who took out a loan in the past two years discovered their lender online.
The spread between those that used an online lender for a purchase compared with a refinance narrowed. Among those that got their mortgage one to two years ago, 40% of those who refinanced used an online lender, but just 16% used one for a purchase. For those that got a loan in the last year, 47% of refinancers and 38% of purchasers used an online lender.
Millennials, those under the age of 35, preferred working less in person and more via chat, especially during the application phase. But they wanted telephone communication during application and after closing.
The 35- to 54-year-old cohort preferred more email and less phone communications throughout the process, while baby boomers wanted less chat and email communications but more on the telephone and in person.
During the application process, more than half of the millennials and Gen Xers preferred a self-service website, online chat or email communications. But over 40% of each group said they wanted telephone or in-person communication.
For boomers, approximately 40% preferred the online options, while over 50% preferred phone or in person.
Approximately 71% of borrowers in the past two years were provided an online portal. Borrowers overall that got access to an online portal were two times more likely to agree technology improved the process (56%) compared with those that did not get access (27%).
"To succeed in this environment, lenders have to put the borrower at the center, which means an easy interface that offers transparency into the entire loan lifecycle, but with humans behind it," Hedges said.