the Future of Banks
My wife and I recently discussed the idea of buying a new car. But, in my experience the car-buying process is a huge disappointment because the car I had my heart set on can’t be found on any dealer’s lot. I am sure this happens because the dealership selects a predefined set of a cars that they think will sell the most of, which didn’t include my prototype.
Before I knew it, we were on the Internet, building and customizing our own car. It only took 15- 20 minutes and the car was built and ready to be bought. The whole point of custom-ordering a new car is mainly to feed your ego, strengthen your identity and give yourself a sense of personalization and taste. You actually feel like you designed it. It was actually easy to figure what your next vehicle will be and how you want it equipped. When you’re done, you’re ready to buy.
Also, I was told I would wait at least 3 months to get my car. Ughhhh. But consider this: Your car is likely the second most expensive purchase you’ll ever make, which brings me to the future of the banking industry. I figure if we can customize a 40 or 50 thousand dollar car, why not walk into your local bank, get a pre-approval letter, digitally build a prototype of a house, customize it and keep it their database until a Realtor has a match. Maybe, you put an offer down on a house and it was counter offered by someone else and they took it. It would be very frustrating to start the buying process all over again. You could literally slide your debit card into the ATM, enter your pre-approval pin code, touch the screen and use your finger to customize a house right there, dragging and dropping new guest rooms or making the living room bigger. They save the information with a touch screen button. Sq footage, number of rooms, style, lay out etc. Sure, there is plenty of 3D/home design software already out there for builders to download and tinker with on their computers and maybe draw one up for a project, but usually it stops there. They are protective and do not share their designs. I say, take the existing technology we already have and take advantage of it and implement it in the bank’s systems.
If we as car buyers can build our own car without a mechanic or auto industry expert, why not build a house without an architect or bank consultant? The real value is making the pre-approval /qualified process quicker, more customized and accurate based on taste and needs of the future homeowner. Simple. Instead of listing hundreds of different houses, why not list 40 or 50 based on the most popular prototypes. Open Houses would be more relevant and useful. Maybe the market would pick up too. http://home-design-software-review.toptenreviews.com/
Maybe, you are a parent with three kids and quality family time is very important to you and all three of your kids are always in three different parts of the house doing three different things. Maybe, you could customize a big room that would serve 3 different functions all at once. Maybe, you are more focused on your pets, or being a weekend entertainer. Maybe, your kids are at college, but you are looking to downsize the size of your house, but looking for a way to accommodate your son or daughter when they return from school. You could make sure your den could easily transform into a guest bedroom. Or if you are entertaining the neighbors, you need to make sure your living room borders the kitchen. All of this is possible and this kind of technology already does exist, but to a bank or lender it’s non existent.
What if a bank analyzed the data of their local market and the result was that 80% of new local home buyers wanted solar panels? Would this sort of information be helpful to local sellers? What if a sunroof in the kitchen was the only thing that was needed to solidify a buyer’s signature? But there wasn’t a sunroof. What now? As a buyer, do you renegotiate a lower listing price with your realtor? Do you call a local builder you do not know?
I think banks need to get smarter and more diligent, but this would be a great base line as new technology can now cater to future maintenance and repair fees for a seller or a buyer. Maybe, you want to make changes before you sell your house or you plan on cashing out some equity to add on a deck or new addition. You customize your new house and your bank would tell you how much your new loan would be, before talking to any builders or contractors. Or maybe, you talk to a builder first, he gives you a quote and then you walk to your local bank, put your ATM card in the machine, modify your house based on new square footage and see if his quotes compares to theirs. Banks need to execute this kind of reassurance to their customers, in order to win them back. I think the auto industry has made more of an effort to be more efficient and effective after their bailouts. But, maybe that’s because people buy more cars in their lives than houses. Let’s talk about this.
Let’s say I go to my local bank, make a deposit, develop a prototype of my first house, picked a location, punched in my prequalified loan amount, and it showed me my rate and payment, taxes and insurance. I went back home and sitting in my email inbox is listing of a few houses not too far from my location, my payment was pretty close to what I could afford and had the specific space and yard that I wanted. Some of my choices are new construction houses and some of them are older models..
I am pretty happy right? Ebay meets home mortgage loans.
But a few years later I get married and buy. A few years later, I have two kids and need to sell. Two years later, I add on a bathroom and deck. Five years later, I get divorced and sell again. Two years later I get remarried and buy. Eight years later my kids want to go to college and I need to cash and refinance. And twenty years later, I want to downsize and sell. Thirty years my kids inherit my house and sell.
I am not sure about the numbers…but my wife and I attended 15 open houses for 1 purchased home. For 1 home mortgage, we spoke to 5 other banks. For every home upgrade…. we will need to speak to multiple builders too.
If reliable bank technology exists to give us an accurate, version of the truth…. we will no longer need 2nd opinions.