People's perspective towards technological advancement in financial services has changed since last year. Many people have adopted online interactions in all aspects of their lives, including the mortgage industry. There are many reasons for adopting Financial technology solutions by consumers. In a report of Business Insider Intelligence, Fintech consumers found it easy to set up an account.
Figure 1: Top reasons for adopting Fintech solutions Image Source: https://www.businessinsider.com/fintech-companies-startups?IR=T
Two out of three people did their financial transactions online in 2020. Financial corporations are investing in digital technology as they understand that innovation will keep them afloat. Innovation in Financial Services has helped people to have access to affordable homes. Online mortgage counseling is provided by Fintech firms so that homebuyers are aware of their options before buying a property. How Fintech Startups have disrupted the mortgage industry is in our earlier blog. Here, we will discuss how Fintech Startups and innovation in financial services are transforming the Mortgage Industry.
Fintech Startups and the Mortgage Industry
Incumbent financial institutions (about 88%) believe that part of their business will lose out to standalone Fintech companies in the next five years. Fintech Startups harness innovation in financial services and achieve business growth. According to Statista, Fintech Startups are the most populous in technological fields globally.
Figure 2: Distribution of Startups worldwide by industry Image Source: https://firstsiteguide.com/startup-stats/
Fintech startups provide an easy-to-use mortgage calculator that helps borrowers figure out their monthly payments. Borrower's details like home price, downpayment, taxes, insurance, and interest rates are accounted for while deciding mortgage payments. Fintech startups have advanced client portals that allow seamless loan application processing from pre-qualification, approval to loan closure. Explanation about Fintech Startups is preventing loan defaults is in our previous blog. The technology used by Fintech Startups includes Python, Django, NGINX, Gulp, among others.
The leading Fintech Startups provide services relating to mortgage loans with the best offers. They help customers in comparing different mortgage lenders and help them choose the mortgage lender of their choice. Fintech Startups use AI and Machine learning techniques for easy loan application processing. Customers can use both the web and mobile versions of the Fintech startups platform to research a property and apply for a mortgage with an interactive AI-powered dashboard. Some of the Mortgage Fintech Startups help in the buying and selling of homes with no hidden payments. Some other Fintech Startups provide home loans to customers and issue unbiased mortgages even to borrowers with no credit history.
Soon with the advance of technology, Fintech Startups will mature into established companies.
Innovation in Financial Services
Artificial Intelligence (AI), IoT (Internet of Things), Big Data, Cloud computing, and blockchain technology are the driving force for innovation in Financial Services. Big Data is used a lot in the financial services industry. IoT and Big Data are giving valuable insights to fintech companies concerning customers’ needs. AI-enabled innovation in Financial services helps mortgage applicants make the lending experience seamless and borrower-centric. Financial institutions are using cloud computing to store and process large amounts of data of customers. Customers are given internet-based access to their accounts through mobile device apps and websites.
The benefits of innovation in Financial services are varied, and some of them are:
- Mortgage loan processing is made smoother- Users get a step-by-step guide for seamless loan application processing. It reduces manual updating of data, including documentation, thus increasing productivity.
- Simplification of captured data by AI-Loan applicant’s details like addresses, income, credit score is stored and tracked for loan processing.
- Customizable financial services-Mortgage lenders upload customer’s borrowing habits with the help of API-led applications. The entire lending process is automated that optimizes the customer experience making it easy-to-use.
- Interactive dashboard with chatboxes and voice assistants- help the borrowers fill the relevant forms for the mortgage loan processing.
Also, innovation in financial services facilitates automation in the loan processing system. One such innovation in the financial services sector is cloud-based Mortgage LOS. This innovative cloud-based Mortgage LOS is giving a much-needed boost to the Mortgage Industry.
Cloud-based Mortgage LOS and its benefits
Cloud-based Mortgage LOS uses cloud computing technology for better management of the loan Operating Systems. Its customer support services run 24/7 and provide extra security to lenders and borrowers. Cloud-based Mortgage LOS improves customer satisfaction by involving less manual intervention, paperwork, and costs. It also saves processing time. The complex documentation process is streamlined with automatic sharing, storing, and updating of documents. Cloud-based Mortgage LOS can be easily configured and is available to the user instantly by using Blockchain technology, there is communication between the lender and borrower. Its use for authentication and verification of the borrower's details. These details include the borrower's history, creditworthiness, and finally, closure of loans. Cloud-based Mortgage LOS involves less operational costs and high process efficiency. Customization of the Mortgage LOS is according to the user's requirements.
Innovation in financial services has benefited the mortgage industry by streamlining mortgage loan processes. Fintech firms are making the existing processes for homebuyers more efficient by using automation and advanced technologies. The potential of Fintech startups in the home lending sector is increasing steadily, with the economy recovering. Inflooens has the best, state-of-the-art Mortgage LOS, which is causing transforming the Mortgage Industry with its scalable and super-fast outcomes.