NAFCU Services Blog

Jun 06, 2022

Reframing the Homeownership Journey: The First Step

By Paul Timm, Vice President, Marketing & Strategic Development | NAFCU Services 

More than ever before, homebuying has become an increasingly stressful process. What should end in joy; moving into new, cozy surroundings and getting a fresh start, can instead feel like a parade of pain and confusion. We all want new homeowners to feel energized rather than drained, and one of the best places to start is by asking some simple, straightforward questions of homebuyers: if the industry could realign its processes to reflect consumer goals better, what would that look like? And where should we start? 

We recently talked with our partners at Blend about the state of the homebuying process. They worked with Aite Group to survey more than 2,000 American consumers who had taken out at least one home-purchase mortgage in the past five years. Their study revealed a number of interesting insights. A key one for this conversation is that 20% used a credit union lender. My first question was why not more?

Fewer than 20% of first-time homebuyers said they consider themselves knowledgeable about tasks like understanding home inspections, the preapproval process, and appraisals.Consumers want informative partners. It’s no surprise that consumers are hungry for information. However, you may be surprised at just how many buyers are asking for help with the process -- especially first-time buyers. According to the results, fewer than 20% of first-time homebuyers said they consider themselves knowledgeable about tasks like understanding home inspections, the preapproval process, and appraisals. Even among experienced homebuyers, just 40% said they’re experts in those topics. First-time buyers also almost universally want help understanding the investment potential of their home: 90% said they would be interested in a service which helped them understand the home as an asset. 

Consumers want help managing the many details and vendor relationships that go along with a home purchase. From a 40,000-foot view, a home purchase doesn’t involve many parties. There’s a buyer, a seller, and a lender. That’s all, right? Oh… except that there’s a title insurance vendor. And a home insurance vendor. And local authorities which record deeds and collect taxes. Not to mention all the utility providers (electric, Internet, water, and so forth) who need to be contacted to establish service, and the US Postal Service to manage forwarding. Little wonder that 66% of respondents in the survey said they wanted help coordinating their moving activities with all of these parties.. The same two-thirds share of respondents also said they wanted help reaching trustworthy contractors who can help with repairs and installation needs as they arise in the early months of ownership.

Nine in ten respondents said they would welcome a one-stop shopping experience for all of the services that go into homebuying.Consumers want a single source of reliable information. Consumers have access to a nation full of lender options and homes for sale right from the palm of their hand. It’s a thrilling amount of flexibility, but also a little overwhelming. That might explain why nine in ten respondents said they would welcome a one-stop shopping experience for all of the services that go into homebuying. The vast majority of recent homebuyers also said they’re even ready for a one-stop buying-and-selling experience: 82 percent said they would be open to a lender pairing a loan offer with a cash offer to buy their existing property.  

Given the unprecedented costs, limited housing inventory, and rising rates, most would-be homebuyers have a mountain of questions before making their next move. In my next post, we’ll dig deeper into the survey results and how we might start reframing a more consumer-friendly homebuying experience. Watch our webinar with Blend to get more insights

About the Author