What First-Time Home Buyers Need

Since there has been so much discussion this past year on whether technology will replace originators, I thought I would share my niece’s experience purchasing her first home. What made all the difference? Her loan officer!

My niece got married last June at age 36. She has wanted to own a home for a while and started her search right after the wedding. She has her own business and has done well with it. She got pre-approved through one of the national VA lenders (her husband is a former US Air Force soldier). The couple picked out a home in Philadelphia after searching for months in an up-and-coming neighborhood.

The first lender did a bait and switch on her closing costs which made her unhappy. She complained to her Realtor about it and the agent recommended another lender which is who she closed with last week.

From her perspective, buying a home was a highly emotional and frustrating process but the second lender’s originator turned the experience around for her. What did he do that impressed her? He contacted her daily either by phone or text to calm her nerves during the process. He continually reassured her that everything was going to be okay and that he would take care of any problems if they arose. For my niece, he became a trusted friend, not just another salesperson.

In my opinion, I think the emotional component of the mortgage lending process is something that is often forgotten or downplayed by mortgage companies and their sales staff. Some management teams would even prefer that a computer handle all parts of the mortgage process. Maybe that day will come but I think senior managers are misinterpreting what customers say they really want. What is that exactly?

According to Fannie Mae’s recent Mortgage Lender Sentiment Survey, most consumers still want the human touch in their transactions. In fact, 90 percent of consumers say they want person-to-person communication (either face to face, on the phone or via email) with their mortgage lenders.

What is interesting is that lenders who participated in the survey believe that person–to-person communications will become less important in the future and that the mortgage process will ultimately become similar to making a purchase on Amazon. I think it is evident that there is disconnect between lenders and consumers: mortgage borrowers show a clear preference for wanting person-to person communication. And certainly my niece valued that assistance during her experience.

Yes, technology will be important to help streamline the mountain of paperwork that is involved with mortgage lending. But that doesn’t mean that the emotional support that a good originator can provide will not be needed in the process.