
All things financial are getting faster, digital and almost invisible. The friction between shopping for things and paying for them has virtually disappeared.
One significant exception is home buying, the biggest purchase and financial obligation that most Americans will ever make. Every aspect of the process is confusing and stressful—which leaves it open for disruption from within and even outside the financial services industry.

Given the size and infrequency of a home-buying transaction, consumer choice is dominated by the pursuit of the lowest mortgage rate. Additionally, a broker or lender might close more mortgages in a day than a customer does in a lifetime. Given this disproportion in experience, customers are immediately put at a disadvantage due to the lack of communication and updates during an often-emotional process.
Eliminating the anxiety that comes with home purchases will go a long way in winning customer loyalty. And there are models in adjacent industries that show the way.
A growing variety of players offer end-arounds on the traditional mortgage. They include lease-to-own fintech startups like Divvy and ZeroDown, and down payment crowdsourcing fintechs like HomeFundIt. While promising, these companies aren’t immune to the pitfalls of the COVID-19 economy.
Companies outside of traditional financial services are currently disrupting banking as they put together the pieces for consumer credit and payments. It’s possible that these innovators may expand their focus into home finance in the near future. The combination of a customer-obsessed mission and a potentially better risk model leveraging the customer data they own could be the disruption that finally eases the anxiety for consumers in the home-buying process. The question: Who will get there first?