Record loan volumes have led to big rewards for mortgage originators in 2021, but according to J.D. Power, the ongoing swell in loan origination activities also has worn away at customer satisfaction.
Per the company’s 2021 U.S. Primary Mortgage Originator Satisfaction Study, overall customer satisfaction with primary mortgage originators fell by five points (on a 1,000-point scale) compared to 2020. This drop was precipitated by reduced satisfaction in the refinancing process, which was heightened by the extended refi boom that has persisted well into 2021.
“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 J.D. 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,” Houston noted. “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.”
J.D. Power’s study revealed that 76% of Generation Y and Gen Z customers “definitely will” consider their current lender for their next refinance after availing of both live personal-service and digital self-service channels. This share rate drops by more than 10 percentage points, however, when only one of the two channels is used.
J.D. Power’s research also suggests that borrowers, especially younger ones, still value in-person communication more than mail, e-mail or texting. Consider that, among Gen Y and Gen Z mortgage customers, the perceived timeline from starting a loan application to having a loan approved is 12.7 days on average when live personal-service and digital self-service channels are used in tandem.
But when traditional and text communication methods are added, the perceived timeline grows to 21.5 days. Satisfaction scores also are lower when all three interaction channels are used, implying that while borrowers value omnichannel availability, the uses of these channels still need optimization, and working with a live person still makes borrowers feel like their loan process is both smoother and shorter.
As far as individual companies go, Guild Mortgage ranked highest among primary originators with a satisfaction score of 884. Rocket Mortgage ranked second at 876, followed closely by Citi at 875. The industry average satisfaction score was 851.