How to get a mortgage online

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Yes, you can apply for a mortgage and even take out a mortgage online

Previously, mortgages were a very paper-heavy process, with piles of documents to sign and multiple in-person meetings.

Some lenders still operate this way. But lately the market has seen an increase in “digital mortgages”.

These technology-based mortgage applications remove much of the tedious manual work normally required and dramatically streamline the transaction.

Thinking of buying or refinancing a home? A digital mortgage could ease the process. Here’s what you need to know.

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How Online Mortgage Applications Work

The exact digital mortgage application process varies by lender, but you can generally expect it to look like this:

  1. Complete the lender’s online application
  2. Connect your bank account and payroll portal to import your financial information, if this feature is available
  3. Submit any additional documentation requested by your lender. You will probably upload it to some kind of portal or fax it
  4. Order a home inspection. You can read more about home inspections here
  5. Wait for the appraisal of your home. This is ordered by your lender
  6. Take out home insurance and provide proof of your insurance to your lender
  7. Attend your closing meetingwhether online or in person

In some cases, mortgage closing can be done completely online. This can include electronic signature of documents and a video chat with a digital notary.

>> Related: Mortgage closing: what happens when you sign?

In other cases, you may need to attend an appointment in person at your title or at the realtor’s office.

Your closing is also when you make your down payment and pay your closing costs.

Is it possible to get a 100% digital mortgage?

Although some lenders offer a fully digital process, in most cases you will need to complete at least one small quantity of physical or in-person work along the way – usually at the closing table.

For the most part, the majority of lenders today will allow you to upload your documents digitally; including your bank statements, tax returns, pay stubs, and more. Many even have online application forms that you can fill out and submit.

But the most advanced lenders? They have direct relationships with payroll processors, banks, and other financial institutions, which allows them to remove a large portion of your financial documents directly from your suppliers and even your employer.

It takes a lot of work and hassle to apply for a mortgage, and it speeds up the process considerably (documentation can often slow your loan down if you’re not in the know).

Finally, a few lenders even allow you to close digitally. Some have electronic signature tools and digital notaries that take the closing table remotely instead of having to meet in person.

In most cases, however, you can expect to attend a face-to-face closing meeting to finalize your loan.

It might sound complicated, but if you want to make sure that everything is going well – or that you get the full breakdown of everything you’re signing and why – it can actually be very helpful.

>> Related: Why closing a house is better in person

How To Apply For Mortgage Online win time

Traditional paper mortgage applications take time. The Uniform Residential Loan Application, which is used by the majority of mortgage lenders, has 300 fields.

How about shopping? You will need to complete several of these forms.

>> Related: How To Shop For The Best Mortgage Rate And The Best Lender

With digital mortgage applications, however, much of that hassle is removed.

Digital apps can often pre-populate much of the form for you, even pulling data from your bank accounts, employer’s payroll system, and more.

This drastically reduces the time required for a request and also starts the processing and subscription steps.

For example, LoanDepot – one of the most prolific online lenders – claims to be able to close a loan in as little as eight days. For the context, the normal closing time is 30 to 40 days on average.

who can not to get a digital mortgage?

A number of lenders offer 100% online service application and approval process, but beware: they are generally reserved for borrowers with traditional profiles, cut and dry.

If you are a more original candidate, you may need to phone or meet with your lender in person at some point along the way.

This may include people who:

  • Not having traditional 9-5 jobs
  • Are self-employed
  • Are retired
  • Need a jumbo loan
  • Have a lower credit score
  • Have higher debt levels
  • Etc.

Basically, anything that puts you outside the box of a “primary” mortgage borrower makes it harder for you to get approved.

Lenders will have to do more manual work on your application. And you probably will also do this by meeting in person or being available for more phone calls than other customers.

Examples of online mortgage lenders

A number of lenders offer fully digital mortgages, with Rocket Mortgage, Better Mortgage and LoanDepot’s “mello smartloan” being some of the more popular options.

Here’s a look at what makes each of these options unique:

  • Rocket mortgage – This lender is a good option if you are looking to apply for your loan through a mobile app. It offers an easy application process and convenient help if you need it. Plus, it’s from well-known lender Quicken Loans – the nation’s highest-rated mortgage company for 10 consecutive years.
  • loan depositMello Smartloan ” – Smartloan is interesting in that it allows you to digitally import all your information about your income, employment and assets, then make personalized loan recommendations based on that data. You can then get in touch with an advisor to help you choose the best route. A good advantage of Smartloan is that it has a built-in waiver of appraisal process that can save you hundreds of dollars and a lot of hassle (if your property qualifies).
  • Better – Better is known for its customer service, as well as its low prices and closing costs. Like Smartloan, you also get a personal loan advisor, and since they’re not commission-based, they’re able to give you honest, unfiltered advice. A quick note here: Better doesn’t offer VA or USDA loans, so keep that in mind. It is also not allowed to create loans in all 50 states.

Some other lenders with digital mortgages include SoFi, HomeLight Home Loans (formerly Eave), and Guaranteed Rate.

Digital or not, always shop

Whether you go for a digital mortgage or not, be sure to shop around. Rates vary widely from lender to lender, and you could save thousands of dollars by getting an extra quote or two. Start here to obtain several personalized quotes at the same time.

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