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Mortgages: The 5 Digital Ingredients for a better pre-qualification journey

The Importance of a Great Digital Pre-Approval Journey

As mortgage rates have fallen to a record low rate in a competitive housing market, borrowers expect a streamlined pre-approval journey and a timely letter they can use to put down an offer.

Leveraging insights from our latest Mortgage Pre-Approval Study, which is part of our Mortgage Digital Tracker, we’ve highlighted the best practices across the five steps of a digital pre-approval journey, from Ally, SunTrust, Quicken Mortgage and U.S. Bank, which cover:

  1. Providing an In-App Application Process
  2. Optimizing for Mobile
  3. Linking External Accounts for Verification
  4. Providing Application Hubs
  5. Offering an Instant Pre-Approval Letter

1. Provide an In-App Application Process

Can borrowers complete the application in-app?

U.S. Bank lets new customers start and complete the loan application in-app, ensuring a quick and seamless journey to submission. The bank informs applicants of the length of the journey, as well as what to expect upon completion.

As more users rely on mobile apps for their banking needs, a mobile-friendly application is integral to supporting customers on the go.

Screenshot captured via our Digital Banking Hub

2. Optimize for Mobile

Brands have made significant progress in producing mobile friendly interfaces, although being able to complete an application via mobile does not necessarily mean that the application is optimized for mobile.

SunTrust reduces the volume of content and amount of content on each screen to make it readable for mobile users. The bank demonstrates how some brands are opting to ask a few questions on each screen and provide signposting to navigate to the next step.

The use of progress meters, dynamic fields and in-line validation guides applicants through the process and informs them of any incorrect answers.

Screenshot captured via our Digital Banking Hub 

3. Link accounts for verification

Many providers are now letting users quickly verify their net worth and assets by linking external bank accounts and in turn, helps lenders deliver an instant decision and loan estimate.

Quicken Loans demonstrates how customers can link external accounts by searching their bank account and signing in with their username and password. Once the account is linked, the applicant can get a holistic view of their total available assets, which helps the lender determine an appropriate loan amount.

Linking bank accounts paints a more accurate picture of borrower’s loan threshold rather than self-reported assets.

Screenshot captured via our Digital Banking Hub

4. Group key document and task requests in a hub

After submission, a number of brands move users to a hub where they can manage their application and documents

SunTrust provides a timeline for next steps and access to the documents upload area. If pre approval is not immediately given, a post-submission hub enables applicants to be proactive and submit necessary items in order to receive a timely response. This is preferable to brands that provide no timeline or indication of loan progress upon completion of pre approval application

Communication at the end of the process is necessary for a competitive buyer’s market.

Screenshot captured via our Digital Banking Hub

5. Instant decision and approval letter

Most lenders do not give an immediate decision and approval letter. After submitting the form, applicant typically wait for a response or review outstanding tasks.

Ally is one of the few brands that gives instant pre-approval and uniquely offers a customizable letter that the applicant can calibrate. The applicant can change details such as assets, loan amount and down payment to create a new loan summary. Borrowers can then deliver the letter to put an offer down on a house.

A pre-approval letter gives an estimate of how much the applicant can borrow and how large of a loan he/she qualifies for. The letter speeds up the home-buying process and enables borrowers to proceed with the next steps with realtors and sellers. A smooth and efficient pre-approval journey is essential for a borrower.

Screenshot captured via our Digital Banking Hub

Want more onboarding insights?

The Mortgage Digital Tracker

Get visibility of best practice in mortgage pre-approval and onboarding processes from your chosen competitors.

See developments in applicant validations, loan calculators, third-party account linking, customizing loan terms and more with our Mortgage Digital Tracker.

The Mortgage Digital Tracker, along with all our Digital Trackers, can be accessed via the Digital Banking Hub.

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