"It's going to be about removing the friction from the consumer experience"
With the digitization of Canada’s mortgage space set to gather pace in 2023, technology will continue to play a key role in transforming the consumer’s experience of the mortgage process and creating a more transparent, personalized journey.
That’s according to a prominent mortgage industry tech executive who’s hailed the ability of technology to address pain points with the current process and make it a more seamless one from beginning to end.
“It’s going to be about removing the friction from the consumer experience. Brokerages have to increasingly think about their customers or the consumers out there and what are the friction points of interaction with you, how your experience [is] different from other industries that they are now accustomed to, and adapting to that,” Hyder Mirza (pictured top), CEO and cofounder of CloudJunction Advisors, told an audience at the recent Canadian Mortgage Summit.
Mirza was speaking as part of a panel of tech leaders in the industry who addressed some of the most prominent trends that are likely to come into play in Canada’s mortgage industry in the year ahead.
How will ride-sharing and food delivery apps change the mortgage process?
The exposure of consumers to a transparent and convenient customer journey has been striking in recent years, whether using a ride-sharing app or tracking a food delivery from oven to front door.
The visibility of those types of process – that being, the ability of customers to see the status of their purchase through each stage – is set to have a big part to play in the mortgage industry in the coming years, according to Mirza.
“For most consumers, when we go and make a $1-million-plus transaction – which is probably the biggest transaction of our life for some of us – we have no visibility,” he said. “We don’t know when my application is complete with the brokerage, when it has been submitted to the lender, what has been submitted to the lender, and when I will hear back.
“There’s a lot of anxiety, obviously, around this whole interaction. But the customer expectations for visibility that have been set by Domino’s and Uber and all these other modern customer apps, they completely break down when they come to the mortgage brokerages.”
Those in the industry who may have been slow or reluctant to commit to cutting-edge technology, Mirza said, should ask two questions: “How are we catering to our customers? Are we treating them the way we’re being treated by other companies and other industries?”
For Kevin Clark (pictured below), chief revenue officer at FundMore, an instantaneous need for response and efficiency has emerged as a result of technological advances – not just among people, but also institutions.
“In our business, in the technology space, it’s about ‘How far can we move the process through the system without human touch?’” he said. “The further we can go without human involvement, the faster we can make decisions to meet those needs of instantaneous reply requirements and speed.”
Clark also noted an emerging trend of locking in risk around each contract, with developments in secure contracts and blockchain geared toward transferring risk and ultimately getting decisions made through a system faster.
“I think that’s a trend that we’re going to see over the next five years where there’s a lot more movement and transfer of committed risk that’s going to enable the mortgage industry to be even faster and more secure than it is today,” he said.
Why should mortgage brokers embrace technology?
Interest rates are currently on the up, and expected to rise further in the coming months – but with mortgage volume set to pick back up again once those rates drop, possibly towards the end of next year, Clark urged mortgage professionals to keep as close an eye on tech trends as possible, and remain cognizant of the benefit that digital solutions can bring to their daily work.
“Technology is going to have an increasing role to support what we saw in the last couple of years,” he said. “It’s going to keep evolving because we might be a little slower today and we’re all watching rates and margins, and rates are going to start coming off by the end of 2023 and we’re going to have volume again.
“And so technology has to be something that’s going to play an important role for all of us as individuals and for our companies that are involved in the space, no doubt about it.”
What changes are you making to the digital side of your business in 2023? Let us know in the comments section below.
