As the world changes, we’re getting increasingly more comfortable with the way technology can help us do things far faster than was possible just a few generations ago. Naturally, technology has been making a big difference when it comes to the mortgage industry as well.
Learning more about technology can help you get the mortgage you want — and how there are still times when it’s better to talk to a lender in-person.
The biggest advantage you now have because of technology is the sheer access to information. You can easily learn everything you need to know about mortgages: how they work, which options are available, how much you’re likely to qualify for, and what you can do if your application is denied. You can play around with mortgage calculators to estimate your mortgage payments (but don’t forget to include the cost of property taxes and homeowners’ insurance).
You also have a big advantage when it comes to comparing mortgage rates. In many cases, you can easily look up the prime rates through many different lenders. Those may not be the rates you get, but it’s good to see who typically offers the lowest rates, especially if you have good enough credit to qualify for those advertised rates.
You need good credit to qualify for a mortgage, and technology can definitely help with that. You’re allowed to request a copy of your credit report once a year to check for mistakes. Many banks or credit card companies also offer you the ability to instantly see changes to your credit score. Hopefully, you’ll be able to see the score gradually increasing as you take steps to improve your credit. However, if you see a sudden drop in your score, you might be able to catch a problem sooner. This could be something like a simple mistake of a company marking your payment as late when you know you paid on time, or it could be something more sinister like someone else opening accounts in your name. In either case, catching it early makes it easier to deal with. You can fix the problem before things get out of hand.
You’ll also find that many people are submitting their mortgage applications online. This is an incredibly convenient innovation because you can apply 24 hours a day. Those who wish to apply for a mortgage in-person can do so, but they’ll have to schedule an appointment during business hours. If you don’t want to take time off work to visit the bank, you’ll really appreciate online applications.
Of course, your application does contain sensitive information, and this might make you nervous. When you apply, make sure you’re doing so through legitimate lending sites, like major banking sites, rather than sites that are not reputable.
FAQs vs. In-Person Answers
Security concerns aside, the most difficult thing about using technology to apply for and get information about mortgages is the lack of personalized attention. This is particularly troublesome when you need questions answered. Most sites offer FAQ pages, but this means you have to spend time searching for the answers to your questions. Furthermore, it’s often impossible to find answers to unique questions on a FAQ page.
If you have a lot of questions about getting a mortgage, you may be better off working with a lender or broker in-person. Builders often have preferred lenders who have experience with new build mortgages and can answer the specific questions you have.
Despite the convenience of online applications, there’s one big hurdle: providing digital documentation to the lender. A bank can’t give you a pre-approval unless they’re able to verify your earnings and assets. They might need to see copies of your bank statements, pay stubs, and tax forms. If you don’t have access to a digital version of these items, you may still need to drop off a paper copy to the lender or find a place where you can scan the documents to submit digitally.
Less Personalized Options
When you get an “instant decision” on a mortgage application, there’s a computer algorithm being used to make the decisions. This might work for those who have a fairly straightforward financial situation (e.g. a salaried employee with a long work history), but it does lack the personalized touch that people with unique situations may require. Don’t worry if your online application is rejected. You may just need to talk to a lender or broker in-person about your status.
Technology certainly offers many advantages, but it isn’t a one-size-fits-all solution. Use it when it’s convenient to you, but don’t hesitate to walk into a bank or speak to a builder if you want a more personalized approach.