Citi (C) will pull out of its retail operations in the Massachusetts market early next year. The bank was careful to say it wasn’t abandoning mortgage lending in the Bay State, but the decision moves a lot of the lending pressure to the strength of its digital mortgage platform. Per Banker & Tradesmen:

The article explained that not only did Citibank and CitiMortgage make the highest number of its loans in Boston, Cambridge, Newton, Lexington, Wellesley, Brookline and Springfield, but it also captured most the market in these areas.

Citi will continue to service Massachusetts loans in its portfolio, it will continue to close on loans still in the pipeline, and it will still originate residential mortgage loans through its direct-to-consumer and digital channels, a spokesperson told Banker & Tradesman by email when the news first broke. Citi did not respond to requests for further information about this strategy or the reasoning behind the decision.

The article mentioned that the switch could represent an opportunity for community banks to capture the missed marketshare, noting that there are mixed feelings in the market about the strength of moving the mortgage market online.

However, while the industry may be slow to jump on the bandwagon, this move from Citi is an example of where the industry is heading.

It’s not new information that Millennials are the next cohort of buyers to join the housing market.

And with the onslaught of young buyers, comes a new way of buying a mortgage.

HousingWire recently held a webinar on how to reach the Millennial first-time homebuyer, emphasizing that they want a digital mortgage.

In addition to this, the government is pushing the mortgage market more online.  The Consumer Financial Protection Bureau’s new TILA/RESPA Integrated Disclosure rule is just one example of this.

Joe Dahleen, president of Taxdoor, a paperless solution for borrowers IRS tax transcripts that does not require a signed 4506-T, said in a HousingWire blog: “There are many benefits that accrue to the lender that can successfully eliminate paper. Such a process would absolutely return a better experience to the consumer, which is likely the main reason the government is making digital the obvious choice.”