Technology reformed the banking and financial industry in unprecedented ways. With the advent of the internet and phones, bank customers can now pay their bill and mortgage payments without ever stepping out of their homes. With seamless financial transactions, mortgage lenders and private mortgage insurance (PMI) providers can efficiently complete their disbursal and collection processes with a few clicks. These financial institutions actively adopt multiple payment technologies to help home buyers pay their home loans effectively.
While buying a home loan, most smart customers don’t only look at low-interest rates. Instead, they also look at the convenience and hidden costs offered by a lender. Studies show that most customers with an excellent credit score are willing to pay a slightly higher interest rate when buying a home loan if offered suitable convenience from day one.
To streamline your mortgage loan processes and attract more customers, you must ideally offer the best in class services and multiple payment options. Let’s see five ways how you, as a lender, can start collecting principal and interest from your customers.
Method #1: Mail or Money Order
Some customers still like to pay their loan amount back using the old-fashioned methods. Although outdated, you must still keep this payment option open for your customers. This is the primary mode of payment for customers based out of remote locations with little to no connectivity.
Method #2: Phone
For people who are not comfortable using technology, payment via phone is the next best option. You can offer this payment method to elderly customers who do not know how to pay using the internet.
Method #3: Hosted Payments Portal
Hosted Payments Portal is one of the fastest ways for your customers to pay you back. It is also seamless and affordable, often with low processing fees.
Method #4: Credit Cards
You can also collect payments through credit cards. Several customers prefer paying through credit cards because it gives them an extended grace period in addition to the existing loan terms.
Method #5: ACH Automated Payments
ACH payments solution is undoubtedly one of the most popular methods of paying mortgages today. The number one reason why customers prefer it is because of automated transfers. After the initial setup, you can easily and automatically collect payments from your customers’ bank accounts on a preset schedule. This way, you don’t need to waste time reminding them to pay every month.
Pros: Some of the other reasons why customers prefer paying through the ACH technology include,
Cons: The initial setup time required to activate ACH payment is slightly longer. However, the best banking partners usually have tie-ups with reliable third-party payment processing companies. The top payment processing companies like iCheckGateway.com help the banks set up a seamless integration to collect payments through ACH. They also help the customers directly in case of any questions or customer service requests. Does your bank offer an ACH automated payment offer? Do you want to learn how to set up loan payments with ACH? Click here to learn more.
As a lender, you can offer a few other services to sweeten the deal and attract more customers. These include:
The purchase prices for real estate in prime locations are going through the roof now. Your customers are probably already facing a financial crunch after purchasing a new home. You can ease their pain by offering them more affordable mortgage payment methods.
Partner up with a reliable payment processor like iCheckGateway.com to provide your customers the convenience and affordability to pay their loans via ACH and credit cards. Click here to download our Product Catalog learn about the variety of payment technology solutions for your business.