Blend's Future of Lending
In many ways, the home loan process is broken. The process of actually getting a loan is nothing short of complex and time-consuming, with a handful of obstacles that make receiving assistance seem like a near impossible feat.
It’s like waiting in line for the DMV, but worse, and plenty of people just end up avoiding it altogether.
Our client, Blend, probably knows that better than anyone. They’ve been working tirelessly to fix a system that’s come to feel highly antiquated for a society that’s now pretty tech savvy.
Blend Prepares for the Future
Blend is a leader in the Bay Area fintech startup scene. Their team has created a new lending system that attempts to prioritize trustworthy, straightforward design for its users on one hand, while trying to balance industry regulations and compliance on the other.
We caught up with Blend’s CEO, Nima Ghamsari, to hear about why he started Blend in the first place. Turns out his parents emigrated from Iran when he was young and much of the inspiration to start the company came from their struggles in first moving to the U.S.
Blend’s mission is to build an online system that makes the lending application process seamless and intuitive. So easy to use that your grandpa, who’s never been on a laptop before, could figure it out.
Barriers to Access
Barriers to the housing market go beyond just culture or language. For many immigrants, buying a house feels like a “no-fly zone”. They’re pretty much ready to cut their loses before they even try.
Finances for housing are incredibly expensive, but technology can actually help lower those costs. Platforms like Blend impact affordability by reducing friction in the tedious mortgage application process.
It can also lower barriers to acquisition. Underrserved communities often rely on mobile, instead of doing everything on a desktop computer. The ease of being able to install an app on a phone can pretty much be life-changing.
Borrowers used to be required to make multiple in-person trips to the bank and to meetings. Considering that many low-income families have multiple jobs and families to take care of, taking time off to run these financial errands can start to feel unrealistic.
The Future of Lending
So, how does Blend fit in? Expanding access leads to increased efficiency that will lower costs-to-serve—this means that the borrow will ultimately have lower rates to pay. Blend’s innovative website also caters to brokers, making it easier to close deals since customers are guided through the workflow so they can understand and connect their information faster. Blend identifies and automates 65% of conditions at a ‘Top 5’ bank.
Customers who start an application in Blend finish 80% of the time—a rate previously unbeknownst to the loan market. On average, Blend also cuts 7–10 days off the time it takes to close a loan.
Blend says it is even more important that lenders provide a transparent and efficient process with a consumer-grade experience for future technology-reliant generations to come. Sounds like it’ll be a win-win for everyone, saving the hassle for banks and consumers alike.
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