Study: Mortgage lenders growing in popularityby Marcie Geffner
Customers were more satisfied with mortgage lenders this year than they were last year or the prior year, according to the latest mortgage lender customer satisfaction survey by J.D. Power, a marketing information company in Westlake Village, Calif.
The J.D. Power “2013 U.S. Primary Mortgage Origination Satisfaction Study,” released November 14, found that customer satisfaction with mortgage lenders had improved for the third consecutive year, averaging 771 on a 1,000-point scale in 2013, up from 761 in 2012 and 747 in 2011.
The study was based on responses from 3,267 people who obtained a new mortgage or refinanced an existing mortgage within the 12 months prior to the survey period of July 30 to Aug. 30. The study measured satisfaction with the loan application and approval process, loan officer or broker, closing process and contact.
Higher satisfaction scores
Overall satisfaction was higher among home owners who refinanced, with an average score of 775, than it was among home buyers, with an average score or 765. The average score among first-time buyers was 772, repeat buyers, 757.
Despite higher satisfaction scores, buyers–particularly first-timers–continued to report difficulties understanding their loan options. This year, 61 percent of first-time buyers said their loan representative explained their options clearly and they completely understood their options. That proportion was 74 percent for repeat buyers and 81 percent for refinancing homeowners.
Borrowers who used electronic closing documents were more satisfied, with an average score of 830, than customers who signed paper documents, with an average score of 772.
Competition could benefit first-time buyers
In a statement, Craig Martin, director of the financial services practice at J.D. Power, said increased competition among lenders could be especially beneficial for first-time buyers.
“First-time buyers often have questions and shouldn’t be afraid to ask prospective lenders about the specifics of the mortgage process and how they will be kept informed,” Martin said. “Much of the stress with borrowing comes from a lack of information and knowledge during the process. Asking when you will be updated and how that information will be provided are two key questions that may help improve the borrowing experience.”
The best mortgage lenders are …
The three highest ranking lenders in this year’s survey were Quicken Loans, Branch Banking & Trust Co (BB&T) and U.S Bank. J.D. Power said Quicken Loans and BB&T performed well across all four factors and U.S. Bank performed particularly well in the loan application and approval process and loan officer factors.