The promised disruption in financial services starts to deliver
The foundations have been laid, the money has been raised and expectations have been driven around the disruption in financial services. We’ve recently blogged about banks being threatened by blockchain entrepreneurs and we’ve recently reported how Google is becoming interest in the mortgage business. Now we have a major player offering simple online mortgages that make the tradition incumbents application systems look like quill pens….welcome Rocket Mortgage;
From TechCrunch; The goal was to allow a person to get a mortgage or refinance their home while standing in line for a cup of coffee.It took nearly five years and a team of 450 people, but today Quicken Loans is announcing Rocket Mortgage.
, an online mortgage that takes just a few minutes to complete. Quicken Loans sees Rocket Mortgage as the turning point in home financing. It’s home financing’s iPhone, Quicken Loans founder Dan Gilbert tells me. And he could be right.
The process takes less than 10 minutes. Like TurboTax, the service repackages complicated applications into a simple online form. But it’s important to note Rocket Mortgage is more than just an online application. The service also verifies information, then provides a conditional approval as valid as something a loan officer would issue.
The process starts with the basic: What is the person trying to do? Pull cash out of the property? Lower their monthly payment? Purchase a new home? The rest of the application is then tailored to the stated goal.
Name and address comes next. Rocket Mortgage then pulls information about the property such tax history, local assessments and historical data. The application asks for employment information, but does so using the person’s social security number.
Then, using a combination of internal and public data, Rocket Mortgage attempts to find and verify that person’s employment history (read: You don’t have to provide paystubs).
Asset and credit information comes next. This is a standard affair, really. Most loan applications require a person to prove they have a certain amount of money sitting in a bank or retirement fund. Expect with Rocket Mortgage, the system verifies the money on the fly instead asking the person to send in bank statements. This is done with a system similar to Mint.com where the applicant logs into their bank account through Rocket Mortgage.
After the person inputs all the data, the system will then spit out a breakdown of fees, the interest rate and their new mortgage payment. Several slider bars allow the mortgage-seeker to play with the fees and interest rate. If, say, the applicant wants to buy a better interest rate, slide the bar a bit and the data will adjust to show slightly higher closing costs, but a lower monthly payment and less interest that will be paid over the course of the loan.
Unlike most online mortgage applications, the rate, the payment, and the fees provided on this screen uses live market data. If the person likes what they see, there’s a button at the bottom of the screen that locks the person’s new mortgage into the rate displayed and sends the form off for approval. About 30 seconds later, the loan is either approved or denied with the same amount of certainty someone would get through a loan officer.
Quicken Loans hopes to instill trust back into the process of getting a mortgage, and there is no cost to apply for the loan or to lock in interest rates. Not ready to do the mortgage at this time? Fine by Quicken Loans. Rocket Mortgage allows you to check the rates and options later on. Meanwhile, Quicken Loans gains valuable information about a potential customer…for an in-depth version of this article click here.