Category: Consumer Lending|MortgageUnited States

Record Mortgage Origination Volume Causes Customer Satisfaction to Erode, JD Power Finds

2021-11-10

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TROY, Mich.: 11 Nov. 2021 — The U.S. mortgage industry earned an average profit of $4,202 per loan on its way to record volume and a record $4.4 trillion in new loans originated in 2020, according to the Mortgage Bankers Association¹—and the perfect storm of low interest rates and high home values has kept the gold rush going in 2021. According to the JD Power 2021 U.S. Primary Mortgage Origination Satisfaction Study,^SM released today, mortgage originators have struggled to manage surging refinancing volume and efforts to streamline new issuance with one-size-fits-all digital workflows have eroded customer satisfaction at critical points along the way.

“Mortgage originators have been working for years to create an effective and efficient origination process, primarily through digitization of the process and implementation of self-help tools, but the massive surge in volume has exposed some serious weaknesses in that approach,” said Jim Houston, managing director of consumer lending and automotive finance intelligence at JD Power. “It’s not enough to provide consumers with electronic applications and digitized tools to streamline and expedite activities up to and including loan closing. Today’s mortgage customers expect personalized, highly customizable experiences that include the right mix of technology and personal interactions based on their unique needs and wants.”

Following are some key findings of the 2021 study:

• Overall customer satisfaction falls across most segments: Overall customer satisfaction with primary mortgage originators has dropped five points (on a 1,000-point scale) this year, driven largely by declines in satisfaction with the refinancing process. Both banks and non-banks have seen declines in scores in all factors.
• Digital self-service combined with live personal service key to retention of younger customers: More than three-fourths (76%) of Generation Y and Z² mortgage customers who use both live personal service and digital self-service channels during the application and approval process say they “definitely will” consider their lender for their next refinance. That rate falls more than 10 percentage points when only one of these two channels is used.
• Application and approval experience still requires some level of human interaction: Among Gen Y and Z mortgage customers, the perceived timeline from application start to approval is shortest when live personal service and digital self-service are combined (12.7 days on average). When traditional/text communication methods (e.g., e-mail, mail, text) are added to the mix, the perceived timeline increases to an average of 21.5 days.
• Omnichannel optimization needed: Nearly one-third (29%) of mortgage customers indicate using all three interaction channels—live personal service, digital self-service and traditional (mail or email) or texting—during their loan origination. This results in lower satisfaction and perception of lengthier timelines than when the optimal combinations of interaction are used. The industry challenge is not to go all digital or all live personal service, but to tailor the right communication to the right customer at the right time.

Study Ranking

Guild Mortgage ranks highest in mortgage origination satisfaction, with a score of 884. Rocket Mortgage (876) ranks second and Citi (875) ranks third.

The 2021 U.S. Primary Mortgage Origination Satisfaction Study measures overall customer satisfaction based on performance in four factors (in alphabetical order): application/approval process; communication; loan closing; and loan offering. The study was fielded in June-September 2021 and is based on responses from 5,414 customers who originated a new mortgage or refinanced within the past 12 months.

For more information about the U.S. Primary Mortgage Origination Satisfaction Study, visit https://www.jdpower.com/resource/us-primary-mortgage-origination-satisfaction-study.

About JD Power
JD Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
John Roderick; East Coast; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

¹https://www.mba.org/2021-press-releases/april/imb-production-volumes-and-profits-reach-record-highs-in-2020

²JD Power defines generational groups as Pre-Boomers (born before 1946); Boomers (1946-1964); Gen X (1965-1976); and Gen Y (1977-1994); and Gen Z (1995-2004). Xennials (1978-1981) and Millennials (1982-1994) are subsets of Gen Y.

 

Mortgage Servicers Score Points with Customers during Pandemic but Threats Loom for Banks, JD Power Finds

2021-07-26

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Industry-wide, mortgage servicers earned high levels of customer satisfaction during the pandemic, increasing overall satisfaction by a significant six points this year (on a 1,000-point scale) through a combination of relief efforts and quick pivots to digital solutions. However, according to the JD Power 2021 U.S. Primary Mortgage Servicer Satisfaction Study,^SM released today, all that pandemic-driven goodwill belies a bigger set of customer experience challenges—particularly for bank-affiliated lenders. As loan forbearance programs come to an end and more normalized customer interactions resume, traditional banks are starting to lose their edge over non-bank lenders.

“Mortgage servicer satisfaction was buoyed by the industry’s response to the pandemic, with some of the biggest gains in customer satisfaction being driven by at-risk and moderate-risk customers who participated in forbearance programs,” said Jim Houston, director of consumer lending intelligence at JD Power. “However, as we look at post-pandemic customer behaviors and responses of low-risk customers, we see that lift in satisfaction may be short-lived. In fact, despite the attention on relief programs, nearly one-fifth of current mortgage customers have had no interaction with their servicer during the past year. Mortgage servicers will really need to up their customer engagement games as the marketplace stabilizes.”

Following are some key findings of the 2021 study:

• Bank-affiliated servicers start to lose their edge to non-banks: While overall satisfaction increases six points this year, the bulk of that increase is driven by non-bank servicers, which see a significant 17-point increase in satisfaction. Bank-affiliated servicers, which have historically outperformed non-banks by a large margin, gain just four points in satisfaction this year.
• Forbearance lift will not last long: Another key driver of increased customer satisfaction this year is the at-risk customer category. Overall satisfaction among at-risk customers increases 15 points year over year, while satisfaction scores among low-risk customers declines one point. Likewise, satisfaction is highest in the study among those customers who participated in forbearance programs (846). This compares with a score of 783 among those who never enrolled in one and 776 among customers who were previously enrolled in a program but are no longer enrolled.
• Banks get satisfaction lift from non-mortgage services: Higher overall satisfaction scores for bank-affiliated servicers are inflated by non-mortgage services. Satisfaction scores among customers who also use their servicer’s bank products are 55 points higher than among those who have mortgage-only relationships.
• Need evident to expand engagement on digital, self-service channels: While website usage increases five percentage points this year, there is still room for improvement with the online channel. Only 38% of customers say they found the desired information on their servicer’s website within the first two pages. When customers had to visit more than two pages, overall satisfaction declined 55 points. Among customers who indicated they would switch lenders if given the opportunity their top reasons, in addition to better rates, were “better/improved customer service” and “easy access to help myself to information about my loan.”

Study Ranking

Rocket Mortgage (which includes Quicken Loans) is the highest-ranked mortgage servicer for an eighth consecutive year, with a score of 860. Guild Mortgage (825) ranks second and Huntington National Bank (824) ranks third.

The 2021 U.S. Primary Mortgage Servicer Satisfaction Study measures customer satisfaction with the mortgage servicing experience in five factors: customer interaction; communications; billing and payment process; escrow account administration; and new customer orientation. The study is based on responses from 8,507 customers who originated or refinanced more than 12 months ago. It was fielded from March through May 2021.

For more information about the U.S. Primary Mortgage Servicer Satisfaction Study, visit https://www.jdpower.com/business/resource/us-primary-mortgage-servicer-satisfaction-study.

About JD Power
JD Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
John Roderick; East Coast; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

 

Record Low Interest Rates Mask Underlying Problems in Mortgage Industry, JD Power Finds

2020-11-07

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Record low interest rates have driven U.S. home sales to a 14-year high and spurred a 200% annual increase in refinancing. While this boom in volume has generally been positive for primary mortgage originators, it has also exposed underlying weaknesses in their digital strategies that could create challenges down the road. According to the JD Power 2020 U.S. Primary Mortgage Origination Satisfaction Study,^SM released today, mortgage originators’ shortcomings in the areas of self-service tools for application and approvals, frequent communication and long loan processing times could negatively affect customer satisfaction over time.

“It’s been a complicated year for the mortgage industry,” said Jim Houston, managing director of consumer lending and automotive finance intelligence at JD Power. “Between surging customer volumes on the origination side, an influx of customer inquiries on the servicing side and a workforce that has been completely displaced by the pandemic, resources have been stretched to their limits. That strain is showing up in slower loan processing times, missed opportunities to communicate and unreliable self-service tools. While some of these shortcomings may have been opportunities in prior years, current market conditions and customer satisfaction metrics indicate that mortgage originators need to look hard at fixing them if they want to stay viable.”

Following are some key findings of the 2020 study:

• Overall customer satisfaction buoyed by low rates: Overall customer satisfaction with primary mortgage originators rises six points (on a 1,000-point scale) this year, driven largely by the competitiveness of interest rates offered. However, satisfaction in several critical client service attributes, such as loan processing time, ease of self-service interaction and helpfulness of customer service, has declined from a year ago.
• Average refinancing processing time increases:  In 2020, the average loan refinancing transaction took 42 days from application to closing, up from 39 days in 2019. Accordingly, refinancing customer satisfaction with the timeliness of the application process and length of time from final loan approval to closing declined year over year.
• Self-service channel usage falters in application/approval process: The number of customers using self-service channels for loan applications and approvals increased five percentage points this year while the number of customers using personal service channels (in-person, phone and e-mail) declined five percentage points. Despite the increase in utilization, however, satisfaction with the application and approval process among customers using self-service digital channels declined 10 points this year.
• Satisfaction directly linked to frequency of communication: The more lenders communicate with customers during the application, closing and onboarding processes, the more customer satisfaction improves. Customers with the highest level of satisfaction (929) receive daily communications from their lender. However, this occurs just 11% of the time.

Study Ranking

Rocket Mortgage by Quicken Loans ranks highest in mortgage origination satisfaction for an 11th consecutive year, with a score of 883. Bank of America (860) and Chase (860) each rank second in a tie.

The 2020 U.S. Primary Mortgage Origination Satisfaction Study measures overall customer satisfaction based on performance in four factors (in alphabetical order): application/approval process; communication; loan closing; and loan offerings. The study was fielded in June-August 2020 and is based on responses from 4,300 customers who originated a new mortgage or refinanced within the past 12 months.

For more information about the U.S. Primary Mortgage Origination Satisfaction Study, visit
https://www.jdpower.com/resource/us-primary-mortgage-origination-satisfaction-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

JD Power is headquartered in Troy, Mich., and has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
John Roderick; East Coast; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

 

COVID-19 Pandemic Increases Customer Expectations of Mortgage Servicers, JD Power Finds

2020-07-30

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Mortgage servicers have been put to the test during the COVID-19 pandemic as a combination of historically low interest rates, record high unemployment and rising delinquencies have created a surge in customer inquiries. According to the JD Power 2020 U.S. Primary Mortgage Servicer Satisfaction Study,^SM released today, that surge is being met with more website utilization, long wait times with call centers and very little proactive communication—all of which drag down overall customer satisfaction scores.

“The COVID-19 pandemic has really amplified the gaps in customer satisfaction, digital experience and call center experience that have been a challenge for mortgage servicers for some time,” said Jim Houston, director of consumer lending intelligence at JD Power. “At a time when the need for streamlined, effective digital guidance and proactive outreach and counsel is more important than ever, mortgage customers aren’t finding the answers they need online, pushing them onto long customer service queues in call centers and leaving them to hunt for answers on how best to address their challenges.”

The good news is that average industry satisfaction is up from 2019 and many of this year’s findings are forward looking, providing lenders with a clear line of sight to what consumers want and expect.

Following are some key findings of the 2020 study:

• Websites need to do more heavy lifting: More than three-fifths (62%) of customers visit their lender’s website as a first line of information but only 28% say online is the most effective channel by which to resolve an issue. Among those who couldn’t resolve their issue on the lender’s website, 45% say the issue was resolved only after picking up the phone to speak with a representative. Given that websites are relied on for common customer activities, lenders need to make sure that their websites are more effective in helping customers resolve issues.
• Traditional channels must work effectively: Nearly one-fifth (19%) of customers say it is not easy to contact a live agent via the telephone. This negative experience causes a 261-point drop (on a 1,000-point scale) in satisfaction for those consumers looking to use this traditional channel.
• Customer fears likely to drive increase in calls: Nearly half (44%) of at-risk customers called their servicer in the last 12 months vs. 25% for low-risk customers. At-risk customers also call an average of 3.15 times vs. 2.54 for low-risk customers. As the rate of at-risk customers grows, lenders should expect elevated call volumes that will challenge call centers already dealing with work-at-home limitations.
• Finding right balance with proactive communications: Customers who receive three or four proactive communications per year from their mortgage lender have the highest levels of overall satisfaction, which is represented by an average score of 810. Yet, only 8% of customers indicate receiving this level of communication. Far more—40%—say they’ve received no proactive communication from their lender, and 29% say they’ve received 11 or more proactive communications. Too few or too many communications cause satisfaction scores to decline.
• A simple “thank you” goes a long way: When it comes to lender communication with customers, the factor with the single greatest effect on customer satisfaction is thanking customers for their business. Satisfaction scores increase by 86 points when lenders thank customers for their business, yet just 22% of lenders do this.

Study Rankings

Quicken Loans is the highest-ranked mortgage servicer for the seventh consecutive year, with a score of 854. Regions Mortgage (846) ranks second and Huntington National Bank (827) ranks third.

The 2020 U.S. Primary Mortgage Servicer Satisfaction Study measures customer satisfaction with the mortgage servicing experience in five factors: communications; customer interaction; billing and payment process; escrow account administration; and new customer orientation. The study is based on responses from 7,275 customers who originated or refinanced more than 12 months ago. It was fielded in March-April 2020.

For more information about the U.S. Primary Mortgage Servicer Satisfaction Study, visit https://www.jdpower.com/business/resource/us-primary-mortgage-servicer-satisfaction-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; Huntington, NY.; 631-584-2200; [email protected]

 

About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

 

Primary Loan Servicers Have a Trust Problem with their Customers, JD Power Finds

2019-07-31

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COSTA MESA, Calif.: 1 Aug. 2019 — Mortgage servicers occupy a unique slice of the consumer finance marketplace in which many of their customers do not select them but are acquired when the servicers purchase loans in the secondary market. According to the JD Power 2019 U.S. Primary Mortgage Servicer Satisfaction Study,^SM released today, the involuntary nature of this relationship, combined with an industry-wide focus on efficiency and cost controls, has resulted in mortgage servicers earning some of the lowest customer satisfaction and Net Promoter Scores® (NPS)¹ of any industry group studied by JD Power.

The industry average for overall satisfaction with mortgage servicers is 777 (on a 1,000-point scale) in 2019, which sits just below life insurance (779) and just above health plans (712) at the bottom of the industries studied by JD Power. The average NPS for primary mortgage servicers is 16, one of the lowest of any industry studied by JD Power.

“Mortgage servicers are really missing an opportunity to build the kind of goodwill with their customers that has proven to translate directly to increased advocacy and repeat business,” said John Cabell, Director of Wealth and Lending Intelligence at JD Power. “The industry’s laser focus on lowering costs, managing regulatory compliance and minimizing delinquencies has come at the expense of customer experience. It is negatively affecting customer trust in their brands.”

Following are some key findings of the 2019 study:

• Trust gap carries consequences: More than two-thirds (70%) of customers do not have complete trust in their primary mortgage servicer. Not surprisingly, these customers also have the lowest customer satisfaction and NPS scores. However, for the 30% of customers who “completely trust” their mortgage servicer, customer satisfaction scores average 256 points higher, NPS is 69 points higher and customers are three times more likely to reuse the company for the purchase of a new home.

• Digital tools not keeping pace: About 60% of customers are accessing information via their mortgage servicer’s website and just 31% are accessing information via mobile, both of which lag other financial sectors in retail banking. Despite relatively low usage, overall satisfaction is highest among customers who use digital self-service channels. Digital utilization varies considerably by servicer, with best-in-class brands showing utilization rates that are about 20% higher than the industry average for key functions such as checking alerts and messages and reviewing FAQs.

• Transferred customers—earning goodwill with a unique customer type: Transferred customers seek the same basic customer experience criteria as those who actively choose a mortgage servicer, yet their satisfaction scores are lower, and they have a significantly higher incidence of problems with payment and escrow accounts. In fact, 54% of first-time home buyers say they are confused, angry or irritated when transferred. This phenomenon spotlights the unique communications and customer experience challenges mortgage servicers still need to address with transferred customers.

Study Rankings

Quicken Loans is the highest-ranked mortgage servicer for the sixth consecutive year, with a score of 878. Regions Mortgage (848) ranks second and Guild Mortgage (828) ranks third.

The 2019 U.S. Primary Mortgage Servicer Satisfaction Study was redesigned this year and measures customer satisfaction with the mortgage servicing experience in five factors: communications, customer interaction, billing and payment process, escrow account administration, and new customer orientation. The study is based on responses from 7,531 customers who originated or refinanced more than 12 months ago. It was fielded from March through May 2019.

For more information about the Primary Mortgage Servicer Satisfaction Study, visit https://www.jdpower.com/business/resource/us-primary-mortgage-servicer-satisfaction-study

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, South America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

 

 

Home Equity Line of Credit Providers Face Growing Threat from Alternative Lenders, JD Power Finds

2019-03-13

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COSTA MESA, Calif.: 14 March 2019 — Despite record-high levels,[1] new home equity line of credit (HELOC) originations have been steadily declining[2] as a perfect storm of rising interest rates, new tax laws and growing competition from alternative lenders has crimped traditional HELOC growth. According to the JD Power 2019 U.S. Home Equity Line of Credit Satisfaction Study,^SM released today, HELOC customers are more likely than ever to shop for alternative sources of funding and HELOC providers are falling short on digital offerings.

“HELOC providers have a privileged position in the consumer lending space by virtue of the relationships they already have with home loan customers, but they cannot afford to rely on those relationships alone to generate new originations,” said John Cabell, Global Business Intelligence Practice Leader at JD Power. “Customers are being wooed by increasingly sophisticated competitors. Right now, HELOC providers are struggling to deliver digital experiences that are in line with customer expectations. That is becoming a major drag on future business as new, digital-native competitors enter the marketplace.”

Following are key findings of the 2019 study:

• Alternative lenders pose bigger threat: Two-thirds of new HELOC customers who obtained their line of credit within the past two years considered alternative products when shopping for their HELOC, a figure that is up from 41% just a few years ago. Likewise, younger HELOC customers (under 40 years old) are far more likely to consider alternative products. On average, these customers consider 2.5 different loan products, including personal loans, credit cards and cash advances.
• HELOC providers missing the mark on digital: Despite rising use and satisfaction with digital channels in virtually every other aspect of retail banking, satisfaction is lowest among HELOC customers who gather information entirely online (819 on a 1,000-point scale) vs. those who gather information in person or via phone only (836) and those who used both online and in-person channels (864).
• Concerns about interest rates, overextending debt drive shopping behavior: Customers concerned about opening a HELOC are significantly more likely to consider HELOC alternatives. The most common concerns among those who shop for alternatives are variable interest rates, overextending debt and higher payment after draw period.
• Long-term HELOC customers less engaged than new customers: Existing HELOC customers who have had their line of credit for more than two years are notably less satisfied with their lender than are new customers. Longer-term customers also have lower levels of product understanding and awareness of offerings. Satisfaction increases the more engaged the HELOC customer is with their lender.

“There are some very obvious areas where HELOC providers could make tremendous improvement by taking certain steps,” Cabell said. “One of the easiest is alleviating customer concerns during the shopping process by publishing clear information on their website about interest rates and payment schedules.”

The U.S. Home Equity Line of Credit Satisfaction Study, now in its second year, measures overall customer satisfaction with the HELOC process and explores the key variables that influence customer choice, satisfaction and loyalty based on six factors: offerings and terms; application/approval process; closing; interaction with the lender; billing and payment; and post-closing and usage.

New for this year, the study evaluates HELOC provider performance across two separate customer segments: new HELOC customers who have had their HELOC for two years or less and HELOC customers who have had their HELOC for more than two years. Awards are based on the responses of customers who have had their HELOC for more than two years.

The study is based on responses from more than 4,332 HELOC borrowers and was fielded from December 2018 through January 2019.

Study Rankings

Regions Bank ranks highest in overall customer satisfaction with a score of 869, followed by Huntington National Bank (860) and BB&T (846).

For more information about the U.S. Home Equity Line of Credit Satisfaction Study, visit https://www.jdpower.com/business/resource/us-home-equity-line-credit-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, South America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

 

Mortgage Customer Satisfaction Increases as Digital Plays Larger Role, JD Power Finds

2018-11-05

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COSTA MESA, Calif.: 8 Nov. 2018 — Customer satisfaction with primary mortgage originators has increased in 2018 as digital origination channels play a more significant role in the process, according to the JD Power 2018 U.S. Primary Mortgage Origination Satisfaction Study.^SM However, despite a clear preference for digital interaction at several points in the mortgage origination process, personal interaction with a representative still plays a key role, particularly when it comes to following up after an initial inquiry.

“The mortgage marketplace is changing rapidly as traditional players and new digital-native entrants ramp up their digital and mobile offerings,” said John Cabell, Financial Services Practice Lead at JD Power. “While improved digital offerings are helping mortgage originators build customer satisfaction, it is important to find the right balance between digital, self-service offerings and personal interaction with a representative. Technology alone is not a magic bullet in this market; the key is knowing where to leverage it and where to layer in more traditional forms of one-on-one support.”

Following are some key findings of the 2018 study:

• Overall satisfaction improves as digital plays larger role: Overall satisfaction with primary mortgage originators is up 10 points (on a 1,000-point scale) in 2018. This is driven in part by increased customer utilization of digital and mobile channels. On average, customers use 3.1 different channels during the mortgage process, with phone (72%), website (69%) and email (58%) being the most commonly used channels.
• Representatives still play major role in customer satisfaction: While usage of digital channels has increased, just 3% of mortgage customers exclusively rely on digital self-service channels in the origination process. In fact, overall satisfaction is highest among customers who spoke only with their lender in person or over the phone (871) when applying for a mortgage, followed by satisfaction among those who used a mix of personal and self-service tools (868). The most important parts of the process in which representatives add the greatest value are in the follow-up contact after an initial inquiry and when confirming loan terms and payment.
• Speed of contact is critical driver of satisfaction: Satisfaction levels decline sharply for each day spent waiting after inquiry for contact from a lender. Overall satisfaction among customers who receive a contact within one day is 869. Satisfaction falls to 852 after two to five days and to 806 after six or more days. The inquiry channel with the fastest overall contact times (2.0 days, on average) is online via smartphone/tablet, followed by online via desktop (2.2 days). Though not all customers use digital channels, those who do value speed of contact.

Primary Mortgage Originator Rankings

Quicken Loans ranks highest in mortgage origination satisfaction for a ninth consecutive year, achieving a score of 876. Fairway Independent Mortgage ranks second with a score of 873 and Guild Mortgage Company ranks third with a score of 857. Mr. Cooper has the greatest year-over-year improvement among rank-eligible companies, increasing 41 points from 2017.

The 2018 U.S. Primary Mortgage Origination Satisfaction Study measures customer satisfaction with the mortgage origination experience in six factors (listed alphabetically): application/approval process; interaction; loan closing; loan offerings; onboarding; and problem resolution.

The study is based on responses from 5,187 customers who originated a new mortgage or refinanced within the past 12 months. The study was fielded in July-August 2018.

For more information about the U.S. Primary Mortgage Origination Satisfaction Study, visit https://www.jdpower.com/resource/us-primary-mortgage-origination-satisfaction-study.

 

Media Relations Contacts
Geno Effler; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules https://www.jdpower.com/business/about-us/press-release-info

 

Mortgage Servicer Satisfaction Remains Unchanged Despite Mortgage Companies’ Investment in Technology, JD Power Finds

2018-07-24

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COSTA MESA, Calif.: 26 July 2018 — Mortgage servicer satisfaction remains flat in 2018, as satisfaction remains similar to the past two years, according to the JD Power 2018 Primary Mortgage Servicer Satisfaction Study.^SM

The industry average for overall satisfaction is 758 (on a 1,000-point scale) in 2018, which is relatively unchanged from 2017 (754) and 2016 (755). This stagnation comes despite extensive investment by mortgage originators into new digital services.

“The mortgage industry has made bold investments in new technology but servicing still has a long way to go,” said Craig Martin, Senior Director of the Mortgage Practice at JD Power. “With only 20% of mortgage customers utilizing mobile technology—which is 2% below 2016—availability and adoption of these services has been slow in coming. Customer expectations are increasing, often influenced by their day-to-day experiences, but servicing is not keeping up. Servicers not only have to decipher the services that provide the most value to existing and new customers, but they also must solve how best to engage customers. Doing so will translate into higher levels of adoption and usage to deliver cost savings and improved experience. There is a lot of room for improvement.”

Following are some key findings of the 2018 study:

• Digital makes a difference, but adoption is slow: Mortgage servicer mobile customers have higher satisfaction and are significantly more likely to be brand promoters than non-mobile customers. However, just 20% of customers use these services, well below levels seen in the JD Power 2018 U.S. Credit Card Satisfaction Study^SM (39%) and the JD Power U.S. Retail Banking Satisfaction Study^SM (55%). Online usage similarly lags with 44% of servicing customers using the website compared with the U.S. Credit Card Study^SM (74%) and the U.S. Retail Banking Study^SM (77%).

• SMS for SOS: Account alerts have become a regular part of the average consumer’s daily life ranging from health alerts from your watch to suspicious activity on your Facebook account. In servicing this capability is relatively underutilized and presents a major opportunity to grow satisfaction.  Half of customers said that their servicer either does not have account alerts or they are unaware the service is available, a metric that has been relatively unchanged for the past three years. Of those that do use alerts, satisfaction is highest among those that receive text message alerts (840), followed by secure messages on the servicer’s website (834) and email alerts (810).

• Battle of the brands: While satisfaction remains flat, brand image ratings continue to decline, with overall reputation and community involvement decreasing significantly from 2017. In a highly competitive origination market in which small differences can have a big effect, the servicing experience can’t be ignored. Among servicers that achieve 900+ in overall satisfaction, 65% of customers say they “definitely will” choose the same company for their next home purchase and 84% say they “definitely will” recommend the servicer. Those loyalty and advocacy numbers drop precipitously when satisfaction scores range between 700 and 900.

Study Rankings

Quicken Loans is the highest-ranked mortgage servicer for the fifth consecutive year, with a score of 857. TD Bank (821) ranks second and has the largest year-over-year improvement. Huntington Banks (819) ranks third.

The 2018 U.S. Primary Mortgage Servicer Satisfaction Study measures customer satisfaction with the mortgage servicing experience in six factors: new customer orientation; billing and payment process; escrow account administration; interaction; mortgage fees; and communications. The study is based on responses from 7,776 customers who originated or refinanced more than 12 months ago. It was fielded in March-April 2018.

For more information about the Primary Mortgage Servicer Satisfaction Study, visit http://www.jdpower.com/business/resource/us-primary-mortgage-servicer-satisfaction-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power is headquartered in Costa Mesa, Calif., and has offices serving North/South America, Asia Pacific and Europe. JD Power is a portfolio company of XIO Group, a global alternative investments firm headquartered in London, and is led by its four founders: Athene Li, Joseph Pacini, Murphy Qiao and Carsten Geyer.

Media Relations Contacts
Geno Effler; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info

 

Banks Must Get Serious about Technology to Capitalize on Potential Home Equity Boom, JD Power Finds

2018-03-27

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COSTA MESA, Calif.: 29 March 2018 — With the number of American consumers expected to take out a home equity line of credit (HELOC) projected to double to 10 million over the next five years,¹ lenders need to improve their digital offerings if they want to capitalize on the trend. According to the JD Power 2018 U.S. Home Equity Line of Credit Satisfaction Study,^SM the digital experience is becoming increasingly critical to customer satisfaction.

The inaugural study evaluates customer perceptions of the HELOC process and explores the key variables that influence customer choice, satisfaction and loyalty based on six factors: offerings and terms; application/approval process; closing; interaction with the lender; billing and payment; and post-closing and usage.

“Lenders need to recognize that the HELOC customer experience is a journey that begins with initial consideration and evaluation and extends through to usage, with each part of the journey affecting overall perceptions,” said Craig Martin, Senior Director of Financial Services at JD Power. “Increasingly, many steps in that process are occurring in digital and mobile channels, which are areas that the industry has been slow to leverage and refine. As Millennial² homeownership rates increase and home values continue to rise, lenders need to be able to meet these customers where they want to be, not try to force them into the lender’s entrenched methods.”

Following are some of the key findings of the study:

• Digital channels become critical for younger borrowers: Established relationships with lenders still play a key role in the HELOC customer journey, with 66% of all borrowers gathering information about a HELOC in person. However, digital is becoming a bigger factor among younger borrowers, with 59% of Millennials gathering information online via desktop computers and 50% of Millennials gathering information online via smartphones or tablets.

• Few HELOC borrowers say they are proactively solicited: The majority (88%) of HELOC borrowers say they began the HELOC search without prompting from a lender, demonstrating that marketing efforts are not having much effect on customers. The group in the study least likely to hear from lenders are Millennials, 94% of whom initiated a HELOC product search themselves.

• Comparison shopping is the norm: More than half (55%) of customers indicate they considered at least one other lender during their shopping process. The comparison-shopping phenomenon is most pronounced amongst Millennials, of which 80% of HELOC borrowers considered at least one other lender.

• Concern is the rule, not the exception: Nearly two-thirds (64%) of all borrowers express some type of concern about obtaining a HELOC product, with Millennial customers showing the highest levels of concern. Only 13% say they had no concerns. Key concerns include the variable nature of the loan and overextending themselves. 

“Steadily rising home prices, rising equity in the home and growing competition among lenders creates an opportunity for homeowners to tap into a low-cost source of funds,” Martin added. “The findings in this study are not only instructive to lenders on how to better tailor their customer offerings and processes to create a better experience, but they also provide a valuable guide to consumers on what to look for when shopping and applying for a HELOC product and choosing a partner for their borrowing needs.”

Study Rankings

SunTrust Bank (869 on a 1,000-point scale) ranks highest in overall HELOC customer satisfaction, followed by BB&T (860) and Huntington National Bank (851). The industry average score is 837.

The U.S. Home Equity Line of Credit Satisfaction Study measures overall customer satisfaction and was fielded in January 2018. The study is based on responses from more than 4,008 HELOC borrowers.

For more information about the U.S. Home Equity Line of Credit Satisfaction Study, visit http://www.jdpower.com/business/resource/us-home-equity-line-credit-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power is headquartered in Costa Mesa, Calif., and has offices serving North/South America, Asia Pacific and Europe. JD Power is a portfolio company of XIO Group, a global alternative investments and private equity firm headquartered in London, and is led by its four founders: Athene Li, Joseph Pacini, Murphy Qiao and Carsten Geyer.

Media Relations Contacts
Geno Effler; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info

 

Despite a Rise in Use of Digital, Mortgage Customer Satisfaction Declines, JD Power Finds

2017-11-07

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COSTA MESA, Calif.: 9 Nov. 2017 — The mortgage industry’s promise of technology creating a faster and easier mortgage origination process does not appear to be fully recognized, as mortgage customers are reporting slower purchase processes. That’s according to the JD Power 2017 U.S. Primary Mortgage Origination Satisfaction Study,^SM released today, which finds that overall satisfaction with mortgage originators has declined this year, due in part to a perception of a slower process, despite a significant increase in the number of customers applying online.

“We’re at a critical inflection point in the mortgage industry where new technology and the growing use of digital mortgage application channels has made it possible for the origination process to move more quickly; however, the customer is still the final judge of speed and quality,” said Craig Martin, Director of the Mortgage Practice at JD Power. “A critical element of satisfaction is setting expectations, and this tends to be a weakness of technology, which is demonstrated by substantially lower satisfaction among customers who do not work with a human to complete their application.”

Following are some key findings of the study:

• Overall satisfaction declines as purchase process slows: Overall satisfaction with primary mortgage originators is down 8 points (on a 1,000-point scale) in 2017. This is driven in part by reports of longer times from initial application to closing. On average, the purchasing process took 36 days this year, an increase of almost a week from 2016.
• Digital use surges but not digital satisfaction: For the first time in the study’s history, both refinance and purchase customers cite online/website as the most frequent method of submitting a mortgage application. A total of 43% of mortgage customers indicate applying digitally in 2017, up from just 28% in 2016. Satisfaction among customers applying online/via website has declined by 18 points year over year and trails satisfaction with in-person applications by 10 points this year.
• Representatives play key role in building customer trust: Overall satisfaction among mortgage customers with high levels of trust in their loan representatives is 358 points higher than among those with low levels of trust. The top three elements driving that perception of trust are representatives always calling back when promised; continuity in working with a single representative throughout the process; and representatives proactively providing status updates.

Primary Mortgage Originator Rankings

Quicken Loans ranks highest in mortgage origination satisfaction for an eighth consecutive year, achieving a score of 878, but this year the company is not alone. Guild Mortgage Company also achieved a score of 878. PrimeLending follows with a score of 859.

The 2017 U.S. Primary Mortgage Origination Satisfaction Study measures customer satisfaction with the mortgage origination experience in six factors (listed alphabetically): application/approval process; interaction; loan closing; loan offerings; onboarding; and problem resolution.

The study is based on responses from 5,893 customers who originated a new mortgage or refinanced within the past 12 months, and was fielded in July-August 2017.

For more information about the U.S. Primary Mortgage Origination Study, visit http://www.jdpower.com/resource/us-primary-mortgage-origination-satisfaction-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power is headquartered in Costa Mesa, Calif., and has offices serving North/South America, Asia Pacific and Europe. JD Power is a portfolio company of XIO Group, a global alternative investments and private equity firm headquartered in London, and is led by its four founders: Athene Li, Joseph Pacini, Murphy Qiao and Carsten Geyer.

Media Relations Contacts
Geno Effler; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/about-us/press-release-info

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