Just a few brief decades ago, almost no one had internet access. Now, the internet has fully invaded every industry, and housing mortgages are no exception.
The housing market has struggled in grabbing the new millennial consumer audience. Research shows that, largely due to the emergence of the sharing economy and changing generational values, young people are not buying homes or cars.
Compared to their parents’ generation, hardly any millennials plan on buying a home in the next decade. Mortgage rates are low, and employment rates are high, but it is simply not a priority for many.
How are mortgage companies capturing millennial audiences?
Instead of trying to rope in young audiences with expansive ad campaigns or through rate incentives, some mortgage companies are taking a different approach. Instead of getting the customer to come to them, they are picking up their businesses and taking it to the customer. And where else could millennials be but – you guessed it – the internet.
It is widely known that millennials essentially live on the internet. They conduct much of their public and private business online. They are the children of the internet age – the expectation is that information on products (in this case, homes) will be readily available, easily accessible and accurate.
Information Access is the key appeal for younger generations
Companies like Zillow, Redfin, and Realtor.com operate well-interfaced real estate search engines that cater to young people’s preference for finding information online rather than heading to an office or hiring a real estate agent.
This online search capability gives a sense of power to the buyer, as they feel they have more control over their finances and future when they are secure that they have accurate information and are not being exploited by a salesperson.
Online mortgages have also entirely changed the lending market. By moving from banks to the web, more peoplecan take out mortgages and gather information about the best rates applicable to them.
Most millennials want to do as much of the homebuying process as possible by themselves, but eventually many also want the affirmation of a real, expert agent. Therefore, even though mortgages are being steadily shifted into the online world, it can never quite push out the importance of loan agents and realtors.
There are plenty of benefits to online mortgage boom, but some negative impacts as well
Online mortgages are often acquired at the lowest possible rates, but without the help of an expert to walk you through the entire process and regulations.
This could actually lead to additional costs down the line due to a lack of understanding of the terms of a mortgage.
However, current technology has made us biased towards the belief that most large purchases can be made very quickly, an aspect where online mortgages have a huge advantage over traditional ones.
Advisory HQ published their recent list of the best-rated online mortgage companies, including:
These companies all have a few things in common which determine online lenders’ success:
-Understandable online interface
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