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The mortgage industry used to rely heavily on in-person applications, but the COVID-19 pandemic has sped up the digital transformation, improving the process for both industry professionals and their clients.

If there’s one constant about the mortgage industry in Canada, it’s the ever-blowing winds of change that sweep across it.

And those winds blew in like a hurricane in 2020 — particularly on the digitalization front — with the arrival of the COVID-19 pandemic and resulting lockdowns.

Much progress has been made over the past decade in implementing the latest technologies and tools to create a more automated and efficient mortgage application process. But one of the biggest hurdles has been encouraging widespread adoption of those tools by both industry participants and clients.

That changed in 2020, however, with social-distancing requirements and widespread work-from-home policies in response to the COVID-19 pandemic lockdowns.

Not only was technology employed to support the shift to mobile work environments, but it played an important role in facilitating the rapid adoption of a more digitalized mortgage process for clients.

This has happened in large part through rapid technological advances in mortgage connectivity and deal management systems that are used to bridge the gap between brokers and lenders.

Not only have these digital solutions improved efficiency between brokers and lenders, they’ve also made the mortgage application process more seamless from a client perspective. Some of these capabilities include everything from auto-population of documents and cloud-based document sharing to electronic signing capabilities and the ability for lenders to pull bank statements and income tax records from source.

Throughout the COVID-19 pandemic, countless buyers and sellers also relied heavily on virtual appraisals and home inspections.

The COVID-19 pandemic accelerated digital adoption

While many of the digital tools to streamline the mortgage application process were already available, they didn’t experience maximum uptake until the pandemic made them a necessity.

One such success story is Sagen, the country’s largest private mortgage insurer. The greater adoption of digital technologies by brokers and lenders has allowed it to streamline the approvals process.

“I would say lenders accelerated their online mortgage application portals. The entire shift from what was pre-pandemic to now, a much more accelerated digital environment, has been good for the whole industry,” says Stuart Levings, President and CEO at Sagen. “It won’t go back. The gains that have been had are here to stay, which I think is phenomenal.”

New innovations to help homebuyers

A growing number of mortgage brokerages, broker networks, and lenders recognize the shift to greater digitalization of the mortgage process and are now getting serious about implementing technology in their financial offerings (also known as fintech).

As of 2019, there were at least 98 mortgage fintech firms operating in Canada, according to research by Deloitte.

Many have been working to improve and innovate not only the mortgage process, but the entire homebuying experience.

Take Properly, for example, a new service that allows homeowners to unlock the equity in their home and finance their new home purchase before listing the current home. Or Unreserved, which is bringing the concept of online auctions to the real estate market while also improving transparency in the process.

Throughout the COVID-19 pandemic, countless buyers and sellers also relied heavily on virtual appraisals and home inspections. While the lockdowns necessitated such solutions, Canadians are starting to embrace the use of this technology moving forward.

According to a survey from the Ontario Real Estate Association, 4 out of 10 Ontario homeowners say that they’re now open, or at least “somewhat open,” to buying a home while only able to view it through electronic means.

The importance of mortgage brokers

While the mortgage journey is improving for borrowers, mortgage brokers continue to be a crucial partner in complementing that experience.

More than 4 out of 10 Canadians (42 percent) obtained their mortgage through a mortgage broker in 2020, according to data from the Canada Mortgage and Housing Corporation.

For most people (85 percent), that decision was based on the expectation that a mortgage broker was best-suited to get them the best mortgage rate or deal, while 84 percent cited the convenience and time savings.

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