Borrowers are coming to expect access to web-based technologies during the origination process.

Online borrower portals, online chat, and text messaging are changing how consumers of all ages approach the mortgage process, according to “The Digital Mortgage Experience: A Study of Shifting Borrower Expectations,” a survey from Velocify. More than a third of them prefer self-service websites, especially during the research stage of getting a mortgage.

As they progress through the application and processing stages, however, borrowers prefer an increasing amount of help from mortgage professionals through online chat, telephone, text messaging, and email.

Millennials (under 35 years of age) prefer slightly less assistance and more online chat help, especially during the application phase. Baby boomers (over 55 years of age) prefer less chat and email assistance throughout the mortgage process, opting for phone and in-person help. Baby boomers, however, embraced technology more than expected. Boomers were three times more likely to think technology improved the loan process when they were provided an online portal.

“The most interesting discovery was not how borrower behaviors have evolved, but where they are headed,” said Nick Hedges, president and CEO of Velocify. “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. 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.”

The survey also found the following:

• Overall, borrowers who got a mortgage over the past two years were 3.7 times more likely to find their lender through online research or through social media than they were 5 to 10 years ago.
• Millennials were 45 percent more likely to find their lender online than baby boomers, who were 87 percent more likely than millennials to use their current bank or lender.
• Refinancing borrowers were more likely than purchasing borrowers to use an online lender, but recently the gap is closing. Over the past year, 47 percent of refinancing borrowers used an online lender, compared to 38 percent of purchase borrowers.
• Borrowers who got a mortgage in the last year were 42 percent less likely to find their lender based on a referral from a realtor, compared with borrowers from 2 to 5 years ago.
• Seventy-one percent of all borrowers were provided an online portal in the past two years. Those that had access to a portal were twice as likely to say technology improved the loan process compared with borrowers who were not provided this option.

“Lenders need to look at technology as more than a tool for marketing and manufacturing mortgages, but a vehicle for creating the perfect mortgage experience for all consumers, regardless of their preferences,” said Daniel Miedema, director of marketing operations at Guaranteed Rate, and a Velocify customer. “Fortunately, today’s tools enable lenders to adapt to changes in consumer behavior quickly and affordably, so borrowers get the help they need when they need it most.”

Findings from the survey were based on responses from more than 500 people who received a purchase mortgage or refinanced a mortgage over the past 10 years. The findings were broken out by the borrower’s age and when their loans closed to examine how consumer behaviors evolved over time.