Ranking highest in a recent study of customer satisfaction during the mortgage origination process was a company known more for wholesale lending than retail.
J.D. Power and Associates announced this week the results of its 2005 Primary Mortgage Origination Study of 4,498 borrowers who obtained a new mortgage in the past nine months among 13 lenders. The report identified three primary factors that drive overall customer satisfaction: application/approval process, loan officer/representative or mortgage broker, and closing process.
ABN AMRO ranked highest in customer satisfaction with the sales experience, garnering an overall index score of 756 (on a 1,000-point scale). The subsidiary of Netherlands-based ABN AMRO Bank "performs especially well within the closing process and receives scores well above the index average for the application/approval process and the quality of service" offered by the loan originators, according to the announcement.
"While ABN AMRO has only recently started to invest in its brand in the consumer space, it has long been known for its efficient, speedy processing of loan applications among brokers," said Jeremy Bowler, J.D. Powers senior director of the finance and insurance practice, in the statement. "ABN was the first to introduce an Internet-based rate lock and application toolset in the wholesale marketplace, and is still viewed as an innovative lender today."
SunTrust Mortgage took second with an index score of 726 and Wachovia followed with a 723, the global marketing information services firm reported.
The closing process has the greatest impact on overall borrower satisfaction, J.D. Power said. Customers place significant value in the convenience of closing and the accuracy of their monthly payment calculations -- among the borrowers whose monthly payment increased from what they were quoted, overall satisfaction was 100-plus index points lower than those whose payment did not increase.
"Borrowers may feel somewhat deceived when their monthly payment does not match what was quoted in the Good Faith Estimate," Bowler said. "It is vital for lenders to be up-front and as accurate as possible with details at that time, especially if assumptions are being made regarding consumer credit scores."
The study reportedly found that 61 percent of recent borrowers had asked their friends, family members, their Realtor or other personal acquaintances for recommendations on choosing a mortgage company. It also revealed that over 40 percent of borrowers use the Internet as an information resource during their lender shopping process.
Recent ABN AMRO borrowers have recommended their lender to an average of 3.3 people, while other lenders' borrowers indicated they've done an average 1.6 recommendations since originating their loan, according to the announcement.
"There is money to be made by really wowing a new customer," Bowler said. "During the post-sale halo period, delighted customers are out there making the most referrals. In a marketplace crowded with lender options, personal testimonial can be the most effective form of advertising for the lender."