The concept of a mortgage, in its modern form, is relatively recent, dating to the early-20th century or thereabouts, and has evolved into an industry replete with many online mortgage companies. But the financial instrument underlying the mortgage concept is itself rather old, dating to the Middle Ages. Everything you need to know about a mortgage can be found in the word’s etymology. Descended into its current form from the original French “mort gaige,” the term literally translates as “dead pledge,” which can seem a bit morbid when taken out of context. In truth, the words when joined as such imply that a borrower’s pledge to a lender will expire (or die) once the loan is fully repaid. Far less frightening a notion when correctly understood.

Note: “Mortgage” would not take on a verb application until the 15th century. It is arguably used as commonly in that form as in its noun context these days.

The Mortgage Concept

So, now we understand the word “mortgage” from a language standpoint. What about the overall concept?

Homes are expensive. Even for the financially well-off, a price tag of several hundred-thousand dollars is substantial. What then is an aspiring homeowner to do absent that kind of cash? One option is to simply become obscenely wealthy.

Go ahead, we’ll wait.

Another (and far more grounded) option is the one many millions of home purchasers have pursued across the decades, just as millions more will do throughout the foreseeable future—apply for a dead pledge—oops, we mean a mortgage.

Laid bare, a mortgage is a high-dollar loan which uses the property it is intended to purchase as the collateral. A lien accompanies the loan into existence and serves as a guarantee to the bank or lender that their money can be recouped if the borrower fails to make payments. This transaction is known in the industry as mortgage origination.

Mortgage Business Explained

Mortgage origination is the process by which lenders assess a potential borrower’s creditworthiness. This aspect of the mortgage business entails a comprehensive review of the borrower’s financial situation, to include debts, income, credit score, and so on. The process can be extremely taxing on a person’s time and patience. Many lenders require the prospective borrower produce large bodies of supporting material prior to approving a loan. In addition to the items listed above, a loan applicant may need to provide various tax documents and even banking statements detailing a person’s overall spending patterns and liquidity.

In short, mortgage applications tend to be comprehensive.

Fortunately for the prospective home purchaser, the industry is now populated with online mortgage companies that excel in streamlining the complex work of mortgage origination. Modern business demands a certain operating agility, regardless of the industry. Just as coffee drinkers are now accustomed to pre-ordering their beverages, mortgage applicants are interested in knowing where they stand credit-wise prior to jumping through a series of increasingly high and narrow hoops.

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Online Mortgage Advantages

The online mortgage space is geared towards efficiency of process. For generations, the work of securing a home loan was reflexively viewed as a cumbersome process, something akin to being audited. It turns out much of the stress and hassle associated with mortgage origination could be mitigated by identifying and eliminating redundancies, as well as by creating fast-track application pathways for highly qualified borrowers.

A few of the more prominent names in the online mortgage space include AmeriSave Mortgage Corporation, SoFi, and Rocket Mortgage. Though each does business in their own way, in accordance with their own tenets, and often aimed towards a certain category of borrower, the general theme of online mortgage business from a consumer perspective is very much the same from one to the next.

Online Mortgage Process

Lower or entirely absent lender fees, intuitive interfaces, and quick results are the hallmarks of virtually online lender in the mortgage business. The aim is simple: To encourage potential borrowers rather than drive them away with nightmarish upfront requirements. After providing baseline income and general financial information, the online lender will evaluate the figures using an algorithmic engine and present you with a quote. From there, you will have an actionable understanding of your borrower profile.

That knowledge allows you to navigate more strategically through the home shopping process. Whether you are making use of a real estate portal business to plan your house hunting endeavor, or simply window shopping through your ideal neighborhoods, an online mortgage company can save you enormous amounts of time and energy when all major financial aspects come into play.

The mortgage concept has experienced substantial evolution since its earliest appearance. So, too, has the business of vetting borrowers and approving home loans. Make certain you’re aware of the online options available to you, as your home-buying experience may well benefit from as much.