Borrowers More Satisfied With Home Lenders

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MORTGAGE EXPERT
11 · 16 · 15

Borrower satisfaction with home lenders improved this year. Quicken Loans Inc. maintained a tight grip on its top-rated lender status.

For 2015, a rating of borrowers’ satisfaction with their residential lenders utilizing a scale of one to a thousand came in at 793.

Satisfaction with their lenders improved from last year, when the Mortgage Origination Customer Satisfaction Index was 786.

The index was reported Monday by J.D. Power in its 2015 U.S. Primary Mortgage Origination Satisfaction Study.

The index considers six factors: application/approval process; interaction; loan closing; loan offerings; onboarding; and problem resolution.

Helping boost this years’ index was a 22-point increase in the
application and approval process factor. J.D. Power noted that this was influenced by improved perceptions of the speed of the loan process.

Borrowers who utilized
digital communication channels instead of communicating through mail and fax were far more satisfied with the processes of completing the application, submitting documents and receiving status updates.

Another finding was that preparing borrowers for an accurate time frame helped mitigate dissatisfaction with longer turn times.

“Effective communication remains one of the most important aspects of a satisfying mortgage experience, especially if the process is taking longer than it has historically,” J.D. Power Director of the Mortgage Practice Craig Martin explained in the report. “As the number of millennial home buyers continues to rise, lenders must be ready to meet their expectations.

“This generation is highly digitally connected, so ongoing communication and transparency via the channels they prefer, particularly mobile, are vital.”

The report indicated that
37 percent of millennials — a group who accounted for the largest share of loan originations over the last two years — said that the origination process was not completely explained to them.

In addition 58 percent
indicated their options, terms and fees were not totally explained to them.

This year’s survey showed that 35 percent of
applications and approvals closed earlier than promised, up from 31 percent the prior year.

Among borrowers whose overall satisfaction scores were at least 900, there were 71 percent
who said they “definitely will” recommend their lender, while 76 percent said they “definitely will” consider reusing the same lender for their next home purchase.

But only 5 percent of dissatisfied customers, those whose scores were less than 700, would “definitely” recommend and just eight percent would “definitely” consider reusing the lender.

For the sixth year in a row,
Quicken Loans had the highest index level: 850. The Detroit-based company improved on its 835 score in 2014.

“Quicken Loans performs particularly well in all six factors,” the report said.

No. 2 Fifth Third Mortgage had a score of 812. The Cincinnati-based financial institution jumped from the ninth spot last year, when its score was just 756.

Next was Bank of America with a score of 811. BofA wasn’t even among the top-10 lenders last year, when its score was just 734.

In third position for 2015 was BB&T, where its score rose to 812 from 798. BB&T fell from its No. 2 position in 2014.

CitiMortgage Inc. was No. 4 with a score of 809. Citi
improved from seventh position last year, when it had a score of 764.

Rounding out the top five this year was U.S. Bank Home Mortgage, where the score climbed to 798 from 783.

Author

Mortgage Daily Staff

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