Will Online Mortgage Broking Take Off?
You could be forgiven for thinking that there aren’t many financial sectors left which have yet to be shaken up by the technology revolution. From selling your home online to peer-to-peer lending, the internet has massively changed the way we manage our finances and many people would say for the better.
Until recently, however, there was one massively profitable sector of financial services which had somehow managed to avoid a technological shakeup, this being the £95bn UK mortgage market. Now, though, this could all be about to change with the launch of habito, the UK’s first digital mortgage broker.
What Is habito?
Habito is the UK’s first digital mortgage broker. UK borrowers can use habito’s mortgage calculator to find out what they can afford or if they are paying too much for their mortgage. If it turns out that they are paying too much for example, they can then use habito’s online application service to help them find the best mortgage deal available for their circumstances. Habito is a free service and their technology allows them to choose from nearly every mortgage deal available in the UK from over 100 lenders.
Why Digitise Mortgage Broking?
For the majority of people, their mortgage will be their biggest monthly outgoing and also their largest single debt. It therefore makes sense to find the best possible deal in this area. In fact, it is estimated that around 25% of UK homeowners are currently spending significantly more than they need to on their mortgage payments, paying lenders around £4,000 more than they should on average each year. This is money that I’m sure many mortgage borrowers would prefer to have in their own pockets during these uncertain financial times.
Despite this, the UK mortgage market as a whole is still very confusing and complex to most, leaving the average borrower struggling to know where to start in finding the best deal to suit their circumstances and objectives. It is unsurprising, then, that around two thirds of people employ the services of a mortgage broker to help them find the right mortgage. Unfortunately, many people are unaware that lots of brokers out there are not ‘whole of market’ brokers, meaning they do not have access to every available deal on the market. Many brokers are instead tied to a specific group of lenders. Not only this, but the whole process of using a mortgage broker to find the right deal can also be quite time consuming, often involving several face to face appointments. This is something that people might not really have time for or even want to do, given today’s busy world. For these people, using an online mortgage broking service could be the answer to several longstanding gripes.
Another potential benefit of using an online mortgage broker such as habito is that they provide a continual and automated service. This means that once you have used the service to take out or switch your mortgage, the technology will then keep a constant eye on the market to ensure that you are always taking advantage of the best deals available. If there is a better deal out there, then the habito platform will alert you to it. This way you can make an informed decision about whether you would like to move your mortgage to another provider or not.
Will It Take Off?
We can see then that while the UK mortgage broking market may be one of the last financial sectors to be shaken up by technology, it is almost certainly one of the most important. Companies like habito could be well poised to take hold of a large slice of this extremely lucrative market.