The field of Internet-based mortgage services just got a little more
crowded by one that is claiming a first -- this one offering online, binding
mortgage approval for consumers.
The company, mortgagebot.com, uses a
proprietary automated underwriting system to provide a real-time credit
decision for consumers by the time they're finished completing the on-line
application.
The on-line application takes most customers less than 15 minutes to complete
according to Scott Happ, president and CEO of mortgagebot.com.
"One thing we've noticed about web-based mortgage lending is that it's very
rate sensitive, and we're ready to compete on rate. But we'd like to remind
consumers to pay close attention to loan fees when they're shopping," Happ
said.
Like E-Loan and HomeAdvisor, two of the more well-known
online lending services, mortgagebot.com offers reduced rates and fees than
traditional lenders because there is greater efficiency and far less overhead
in a web-based operation.
iQualify.com, whose parent is Finet Holdings (Nasdaq: FNHC), has offered online mortgage approvals for about a year.
Happ said there are a number of Internet lenders offering unusually attractive
rates but charging high loan fees.
"We've seen some lenders with rates as low as ours or slightly lower but who,
after some digging, reveal charges like a $995 loan administration fee or a
$400 underwriting fee and other junk fees," said Happ. "We're committed to
quoting all fees up front and keeping them as low as possible."
Roughly half of the consumers who apply on-line are approved immediately
according to Happ. Between 60% and 75% of those who don't receive an instant
on-line approval are approved "off line", usually within hours.
In its initial release, mortgagebot.com offers first mortgages for people who
are buying or refinancing an owner-occupied, single-family home or condominium
with at least 20% equity. The service is currently available in 25 states with
nationwide coverage targeted by mid summer.
Mortgagebot.com is a division of M&I Mortgage Corp. which is a subsidiary of
Marshall & Ilsley Corp. (Nasdaq: MRIS), a $21.6 billion bank holding company
based in Milwaukee, Wis.
Published: March 30, 1999
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