Qualia is continuing to monitor consumer preferences in our Homebuyer Sentiment Index. In our latest installment, Summer 2021, we commissioned Savanta, a third-party research firm, to track how homebuyer expectations have shifted since our last survey in November 2020 (also conducted by Savanta). The results indicate that technology is moving the needle on consumer expectations; however, consumers still find the homebuying process confusing and value in-person consultation throughout the process from knowledgeable real estate agents, lenders, attorneys, and title & escrow agents.
Homebuyers find the closing process confusing and stressful
The home closing process is still one of the most confusing parts of the homebuying experience. Our survey indicates that homebuyers find the closing process the most stressful and complicated part of the real estate transaction. When we explored the homebuying journey as a whole, homebuyers said that the move-in process was the only thing more stressful or complicated than the closing.
Reduce stress for first-time buyers with more face-to-face ahead of the closing date
Future homebuyers seem to be more apprehensive about the closing process. One in four future homebuyers reported that they do not understand the closing process (compared to 1 in 10 recent homebuyers). This may be the reason 55% of future homebuyers would like face-to-face communication with a professional prior to the closing process (compared to 38% of recent buyers).
First-time homebuyers are also more inclined to want face-to-face meetings throughout the closing process. Sixty percent of future first-time homebuyers said they would like face-to-face communication prior to the closing. Additionally, when asked “what would you value most in a future closing?” first-time homebuyers were more likely than returning homebuyers to say they valued “clear explanation of closing documents” the most.
As title & escrow agents build strong relationships with their real estate agent partners, they can help educate consumers early on in the closing process by providing materials that explain documents and how the closing will proceed. Plus, being an available expert resource to consumers can help to ease anxiety during a stressful process.
Digital touchpoints can help reduce stress ahead of the closing too
Despite an overall desire for face-to-face communication ahead of the closing, future homebuyers also expect online communication. For example, 46% of future homebuyers would like to receive email communication about the closing process, 44% would like to receive communication about the closing process through a secure mobile app or web-based portal, and 29% would like to receive online educational materials. Notably, Generation Z and Millennial homebuyers were more likely than Generation X or the Boomer generation to want educational materials ahead of the closing date.
Title & escrow agents can help to expertly guide homebuyers through the process and create a premium closing experience by providing the right information when and how consumers want to receive it.
Meet homebuyer needs on closing day
Over the past year, remote online notarization (RON) eClosings have dominated industry news. And while investment in eClosing platforms has undoubtedly increased for both mortgage lenders and title companies, the actual implementation is still lagging due to a number of factors, including local legislation, hesitancy among secondary market players, and still-needed coordination (and interoperable technology) between lenders and title companies. Our survey found that only 13% of homebuyers experienced a fully digital closing. This remains consistent with our survey findings in November 2020.
Homebuyers report that the amount of paperwork is the most challenging aspect of the closing process. This makes sense when we look at the digital tools homebuyers are afforded to mitigate the overwhelmingly large amount of paper during the closing process.
Overall, there is a sizable gap between the amount of technology homebuyers expect during the closing process and what they actually use when they close on a home. The majority (51%) of future homebuyers anticipate they will use a digital signing platform to eSign closing documents; however, only 40% of recent homebuyers report using an eSign platform. Similarly, 45% of future homebuyers expect to use a secure mobile app or web-based portal to exchange information and receive updates, yet only 27% of recent homebuyers report using one.
Title agents can be proactive with homebuyers to determine their technology preferences upfront and better prepare for and deliver the best experience on closing day.
Balancing digital and in-person interactions to deliver a premium customer experience
Title & escrow agents must work with their mortgage lender and real estate agent partners to find the right combination of digital and in-person interactions to deliver a seamless consumer experience. Solutions like Qualia Connect enable real-time, automated updates to inform homebuyers, sellers, real estate agents, lenders, and other transaction stakeholders on the progress of a closing. This frees up title agents to focus on delivering high-touch customer service where it matters the most. By offering the right balance of digital and in-person touchpoints, title agents can turn a stressful and complicated experience into a transparent and empowering process for homebuyers.
Learn how Qualia Connect can help you to transform home closings for your clients.