Mortgage lenders rethink home loans for millennials

Jeff and Zizi Patmont are two 30-year-olds who turned to the Internet for fast help with getting a mortgage loan to buy a home. The couple used online lender Social Finance, provided their employment information, and got pre-qualified for a home loan in under 15 minutes.

The first-time home buyers used their loan pre-qualification to bid for a ranch home with four bedrooms outside San Francisco and closed just 15 days after making the bid, “which helped us. The competing offer couldn’t close that quickly,” Jeff Patmont said.

The Patmonts are part of the millennial generation in the 18-34 age group, which is inspiring changes in the mortgage industry.

According to a Pew Research Center report in 2014, millennial mortgage borrowers want a technology-based loan application process, plus online resources for this do-it-yourself segment of the population that uses the Internet as a learning tool. Millennial borrowers also are accustomed to speedy service online and expect faster mortgage closings.

Transparency also is important to the millennial generation. “They want to know where their loan is in the process,” said Terry Moore, the senior managing director of credit services at Accenture. “Some companies are coming out with digital dashboards so customers can track their loan. Things like that will serve all customers, but it’s driven by millennials.” [New York Times] – Mike Seemuth