A loan application is the moment a shopper becomes a borrower. Every extra question, unexplained term, and dead end on that path is a place where they close the tab and go back to the big bank's app.
Why do people start a loan application and quit?
They quit when the form costs more effort or trust than they are ready to give. The usual causes:
- Too many questions up front. Income, employer, address history, and assets on page one, before they know if they qualify.
- Documents before trust. Asking for pay stubs and tax returns before the applicant knows the rate, the next step, or who will see the files.
- Jargon. APR, DTI, escrow, and "collateral position" with no plain explanation next to them.
- No save and return. The applicant needs a document from a drawer at home, leaves, and has to start over.
- No person to ask. No phone number, no chat, no name on the page. One question with no answer ends the application.
- No education before the form. People who do not understand the product yet are not ready to apply for it.
How do we find out why our applicants leave?
Watch five people try it, and read your funnel data next to what you saw. Recruit five people who look like your members, give them a realistic loan to apply for, and watch without helping. The same three or four problems show up again and again. Then check your analytics step by step: the page where most people leave is where the session notes will point you. Either one alone misleads you.
What fixes usually work?
- Ask for the minimum needed to give a first answer, then ask for the rest.
- Tell people what they will need before they start, so they can gather it.
- Say who sees their documents and why, right where you ask for them.
- Put a plain-English line next to every banking term.
- Let them save and come back by email or text link.
- Put a real person's name and number on every step.
- Put the education (what the loan is, what it costs, how long it takes) before the form, where people decide whether to start.
Have you done this for a bank?
Yes. I led UX on the U.S. Bank consumer mortgage business with a team of six to seven: research, funnel architecture, SEO, and prototyping. Every tracked metric went up between 5% and 45%. Mortgage is an education-heavy sale, so much of the work was the path before the application: entry pages, rates pages, calculators, and guided selling. The full story is in the U.S. Bank mortgage case study. I also led UX and product design in-house at Principal Financial.
What does it cost to fix?
A one-hour review of your loan application is $150, and you get a list of what to fix first. A one-day working session with your lending, digital, and member service people is $3,500 and ends with a ranked fix list and a test plan. If you need a senior UX or research lead on the team for a few months, that is a monthly seat. See UX research and team leadership.
Is the problem the form or the whole process?
Often the whole process. If the application hands off to a branch, a phone call, or a document portal that works differently, people drop there too. Mapping the whole path from first search to closing is service design.
Answered by Jared Lukes, Minneapolis. Twenty-five years in brand, UX, and technology, currently holding fractional AI and technology seats at three companies. About Jared.