A new survey of home buyers shows a greater need for information about the lending process to help ease buyer stress.
Home Buyers and Lending
The TD Bank survey also revealed some of the following findings on the homebuying process:
- 14% of home buyers researched their lenders through social media, double the number two years ago.
- More than half of home buyers put down less than 20 percent when purchasing their first home.
- 32 percent of respondents financed their home with a mortgage affordability program, including 56 percent of millennials.
- Nearly a quarter of home owners share a mortgage with someone other than a spouse (42 percent, among millennials).
- 26% percent of home owners purchased a home with their significant other before marriage.
Source: TD Bank
Overall, Americans are ranking recent homebuying experiences higher — “very good” or “excellent,” according to a new poll conducted by TD Bank of more than 1,300 American home owners. The percentage of more satisfied home buyers has grown nearly 10 percent in the past years, even though the mortgage process has adopted new rules that has made it more time-consuming for applicants. Respondents identified the most positive aspects of a home purchase as getting approved for a mortgage, finding a good REALTOR®, and finding the right lender.
However, the lending process remains a significant stress factor for home buyers. Respondents identified the following areas where mortgage lenders need to improve: adding more information online, training front-line staff, and offering home financing seminars or workshops.
Sixty-seven percent of millennial respondents said the best way banks could educate them on the mortgage process was to add additional online information and resources.
They also want to be better prepared for the settlement table. Sixty-two percent of respondents say they spent close to $2,000 in unexpected costs during the mortgage process, while nearly half of millennials say they faced up to $5,000 in unexpected costs.
“Our data demonstrates that homebuying sentiment is improving, but lenders still need to adopt a more omnichannel approach to providing financial guidance and expertise,” says Kevin Gillen, senior vice president of mortgages at TD Bank. “Consumers should find a lender who can educate and support them on all aspects of the mortgage process. By understanding the process, they will enjoy a more positive homebuying experience.”
Source: TD Bank