What goes into getting a mortgage or refinancing your home? A fairly individualized process that hinges on both the lending bank and the borrowers’ history, the mortgage industry is on the brink of transformation – and it’s all because of big data. From the initial application process to ongoing loan servicing, data banks are dictating lending in an unprecedented way.
What does big data mean for your mortgage? Here’s an inside look at a changing industry.
As noted, loan approvals used to be fairly individualized because isolated loan officers looked at isolated pieces of information and decided whether or not you qualified. The onboarding process took a long time and was prone to missing key factors because, while there was more data out there that could have been placed at their disposal, most of it was just warehoused and not accessible. Now computers can cross-reference information during onboarding to confirm that borrowers aren’t submitting conflicting information or disguising their financial history.
Following this high speed onboarding process using immediately accessible data banks, loan officers are able to make immediate decisions about your qualifications. Actually, a computer makes the decision and feeds that decision back to the staff members, but this makes for …