WASHINGTON—When it comes to getting a mortgage, the use of channels that require a personal touch is declining, a new Fannie Mae study shows.
As part of a recent Fannie Mae special topic analysis, Fannie Mae’s Economic & Strategic Research (ESR) Group said it surveyed recent homebuyers – those who purchased a home with a mortgage acquired by Fannie Mae between January 2023 and November 2023 – to better understand adoption rates and overall experiences with digital verification technology.
The Findings
Among the findings:
- “Consistent with the exponential growth of technology use in our day-to-day lives, the use of personal-touch-only channels (i.e., in-person or by-phone) when obtaining a mortgage has significantly declined. Most recent homebuyers opted for a hybrid approach, leveraging both online channels and personal-touch channels,” Fannie Mae said.
- Overall, recent homebuyers expressed immense interest in having a more or fully digital mortgage process.
- Many recent homebuyers reported they were not offered the digital verification option to grant lenders’ access to their online bank accounts for lenders to verify funds for closing or down payment. Among those who were offered, most agreed to grant permission. For the very few who were offered but declined, data security was cited as their primary concern, Fannie Mae said.
- Slightly more than half of recent homebuyers who granted lenders or technology service providers (TSPs) access to their online bank accounts said they would use the digital verification technology again for their next mortgage. Of those who were not offered the digital verification method, only 15% said they would use the technology on their next mortgage, indicating that prior experience matters for technology adoption, Frannie Mae said.