2021 Portfolio Growth Outlook
Borrowers' expectations for lenders have changed
Let’s be honest, loan application processes aren’t exactly exciting. Actually, they’re typically time consuming and often frustrating. This is true for both the applicant and the lending team.
Borrowers want their consumer loan application experience to be just as straightforward as lighting fast retail experiences. Muddled transparency and long wait times in the application process can lead to lengthy delays and higher abandonment rates.
Applicants are short on time. They’re focusing on keeping their business alive and how additional working capital can help their business grow. Being able sit down and set large chunks of time aside isn't always realistic.
“I’m always moving! If I’m not on my phone, I know I have to wait and get to it later. For me, that could be between midnight and 2:00 AM...” - Mariha (Applicant)
Unclear instructions cause applicants to wait until they can meet with someone to walk them through the required materials. Entering 2021, lenders need to be able to offer a self-service digital experience coupled with high-touch guidance. The last thing we want applicants muttering to themselves is “I started this process 3 months ago, why don’t I have a loan yet?". If lenders are not able to keep up with breakneck fintech innovation speed, borrowers will turn towards predatory lenders and racking up credit card debt.
Why customer experience matters
Word of mouth referrals are hard to come by when clients are blindsided with new requests for information or have no idea that it will take an additional 2 weeks before an approval turns into cash in the bank. Clients aren’t telling their friends about how much they borrowed, they’re comparing whether or not their journey was better than their friends. A journey that drives referrals sets clear expectations at the beginning, middle and end of an application process.
The fastest loan origination software on the planet doesn’t make up for confusion, anxiety, and credibility issues during the application process. Those are only solved with transparency and skillful expectation management. This is especially true with high-touch application processes that require multiple required documents.
As former lenders, we challenged ourselves with the question of “How do we turn the application process from dissatisfying to satisfying?”. It makes sense that we focus on this part of the process as it is the first interaction in the relationship with a client that will leave a lasting impression.
Increased efficiency through technology
For lenders, juggling a high number of applications at different stages can mean long wait times for clients or even having to temporarily shut down the application process. Trying to review documents and provide further explanation while collecting payments and attracting new applicants can put a strain on the team.
Lenders across the country are rising up to the reality of outdated processes and meeting their clients where they’re at. This means making investments into technology that meets borrowers’ expectations.
Improvements such as sending application updates via text message and changing PDF application forms into mobile-friendly digital forms are no longer ‘nice to have’. Making the application process approachable through intentional design has become a necessity to being a viable choice for borrowers.
Looking for portfolio growth? Try better expectation management
Better expectation management has the added benefit of delighting your customers along with growing your portfolio. With Lenderfit, you can provide transparency and real-time updates while keeping the lines of communication open all along the way. Communication works its way through every phase and is visible to your team members.
Having the ability to create, measure, and improve that applicant journey is the key. Product templates ensure the same same white-glove experience time and again without feeling like you're working with a machine. Lenders receive alerts for quicker response times.
When you’re done with the application you can immediately transition into a post-approval product to track quarterly financial or other covenant items. This leads to an organized and familiar process for both you and your clients.
Interested in taking the next step in growing your portfolio with Lenderfit?
See how you can:
Increase transparency with a start-to-finish checklist
Visually track your team’s progress
Provide guidance for each application requirement