The Internet may make it easier for prospective homebuyers to shop for rates, but it is not yet clear that borrowers will ever be comfortable applying for loans on-line.

Loan origination on the Internet was a key topic last week at Technology for the Senior Executive in Mortgage Banking, a conference sponsored by the Mortgage Bankers Association of America.

"About 40 million people have Web access," said John McMurray, president of Keystroke Financial Network, a company that designs Web sites for lenders. "Forty million people is a pretty big niche - one lenders should not be ignoring."

But Mr. McMurray said most borrowers use the Internet only to shop for rates. To apply for a loan, he said, most are still more comfortable using traditional channels, like visiting a branch.

Privacy concerns also deter some consumers. Technology experts said powerful encryption tools are available, but as long as consumers think the Internet isn't safe, growth in Internet applications will be sluggish.

"Consumer perception will drive the adoption cycle," said Gregg Hoshovsky, manager of strategic systems development for MGIC Investment Corp., a mortgage insurer.

Jeffrey A. Lebowitz, principal of SSP Associates, a research firm that conducts a mortgage technology survey, said substantial origination volume on the Internet is at least five years away. Today the Internet accounts for about 1% of all originations.

Software companies have expanded into the mortgage business as Internet use has increased.

Intuit Inc., the maker of the popular Quicken personal finance software, unveiled a QuickenMortgage Web site this month. It features products from several lenders, including three of the nation's top five originators, Countrywide Credit Industries, Chase Manhattan Mortgage, and HomeSide Inc.

Mr. McMurry said many financial services companies that don't now originate home loans have contacted him about setting up on-line mortgage sites.

Many conference-goers said they were preparing for Microsoft Corp. to come out with a mortgage-related Web site. Some said it might happen early next year.

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