Mortgage Applications Finding A Home On The Web
March 24, 2006
Applying for mortgages online is beginning to come into its own, according to a recent research study by SYNERGISTICS RESEARCH CORP. entitled, Innovations in Mortgage Lending. The national online survey was conducted in October of 2005 with 1,000 consumers age 18 or older across all income groups.
In the survey, homeowners who have a first mortgage were asked if they did any of a number of activities online the last time they applied for a mortgage. Overall, seven in ten identify doing at least one of these online activities. Indicated by about half are researching interest rates in general and using calculators and Web sites for determining monthly payments under various criteria (Exhibit 1). Somewhat more than four in ten compared rates and terms among different institutions. One-fourth read information at personal finance or general news Web sites about the process of applying for a mortgage. One in seven indicate that they actually applied online. As shown in Exhibit 2, the incidence of having applied online for a home mortgage increases to one-quarter of mortgage holders with home values of $500K or more.
William H. McCracken, CEO of SYNERGISTICS, stated, “Those mortgage lenders who do not handle mortgage applications online by this time may be finding themselves in a position of having to play ‘catch up’ from which it may be difficult to recover. Online information gathering and research is all but a given among Internet-active households. Applying online has already occurred to a significant extent and may well become more prevalent, appealing to certain segments who do not require face-to-face interaction for obtaining a mortgage.”
These are findings from SYNERGISTICS study featuring a national survey of 1,000 consumers age 18 or older. This report evaluates consumer usage of mortgages and examines reaction to innovative products, the application process, and online shopping and applications. Experience with home equity credit products and refinancing activity are also examined.