I like to think I’m surrounded by mostly smart people.
Okay well… I don’t think that at all actually, but my therapist says I should try to be more optimistic.
Anyhow, it astounds me how so many *grits teeth and smiles* perfectly intelligent folks can be so infatuated – and hypothetically informed – regarding dangerous lending a la ‘the Great Recession’ — yet don’t bat an eye at commercials offering mortgages that can be completed in minutes.
What I’m referring to is Quicken’s ‘Rocket Mortgage,’ as well as its various competitors.
Rocket Mortgage and its fellows offer the same mortgages and refinance loans that most lenders offer, such as conventional, jumbo, FHA, VA and USDA loans lending outlet Bankrate explains,
“The benefit is that you will have less paperwork to deal with and more push notifications as you proceed through the mortgage process. Borrowers can share their financial information directly with Rocket Mortgage, which verifies it as you go, cutting the time it takes to close on a home.
Rocket Mortgage home purchase and refinance loans start at eight-year terms and go up to 30 years for a fixed-rate mortgage. If you need a bigger loan, you can apply for a jumbo loan product which offers from $453,100 to $3,000,000 in financing. There are also adjustable-rate mortgage options ranging from five years to 15 years.
For borrowers who need low down-payment and more flexible qualifying requirements, Rocket Mortgage offers FHA and USDA loan options. Veterans and qualified borrowers can apply for VA loans through Rocket Mortgage, as well.”
Now let me be clear here before a mob of snarky accountants run me down with jokes and haughty chuckles in explaining that despite advertising, people who get a ~spaceship loan~ aren’t actually *finalizing* it.
People hoping to acquire 3 million dollars in a few clicks will find they’ll still have to close out the underwriting phase, which generally involved going somewhere in person at least to close.
This doesn’t really detract however from the fact that mortgages are extremely substantial financial decisions that can pin people to homes for decades upon decades, and if rashly taken can ruin someone’s finances for life.
Worse, as we learned in 2008 ill-advised housing loans en masse not only affect the people burdened with them but can cripple the economy of the world’s sole superpower plunging the global economy into severe recession…wow, space age.
Thus, it really very much concerns me as someone who despite not particularly caring for the financial health of major corporate assets nonetheless prefers the economy to not be in ruins; that we don’t really see any issue with letting people successfully acquire million-dollar mortgages in moments after being inspired by an advertisement.
While technological development is great and does mean everything – including mortgages – will evolve in ways, the basic principles of sound financing aren’t quite as fickle to the times. I’ll leave you with a Forbes piece following the concept’s release,
“Apparently as cutting edge as the Quicken/Rocket tech focus may be, the socio-economic hangover from the mortgage-driven financial meltdown back in 2007/2008, is still a fresh and painful memory. Although Quicken was quick to respond that easier mortgage getting did not mean easier mortgage guidelines, the message was clear; consumers want mortgage financing done right more than they want it done fast.”