While residential real estate lending has made good use of new technologies over the past several years, commercial lending is still in the dark ages with old, manual processes.
Not only are commercial real estate lending methods outdated, but they’re costing the industry time, money, and business. Right now, digital mortgage companies are on the rise as 25% of loans are now from direct-to-customer organizations. Most borrowers are looking for exceptional customer service, and with the lengthy process of traditional lending, borrowers are looking elsewhere to get the job done.
Alternative lending platforms such as Crowdstreet, Fundrise, and Yieldstreet, are growing, and threatening to completely forego the use of banks in the lending process.
Currently, with traditional methods, it can take about 3 months to close a deal. Not only is this frustrating and wasteful, but the result is that borrowers rarely get the deal they wanted.
Commercial real estate lending is in desperate need of a makeover and a full adoption of the technologies available.