J.D. Power warns that the mortgage customer experience is increasingly commoditized, with few lenders finding the right formula to be seen as trusted advisers.

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As mortgage lenders embrace technology to automate processes and cut costs, a new consumer survey suggests they risk losing opportunities to be seen as trusted advisers as the customer experience becomes increasingly commoditized.

The J.D. Power 2022 U.S. Mortgage Origination Satisfaction Study, released Thursday, found just 28 percent of lenders are meeting all of the key criteria the consumer research firm identified as required to be seen as a trusted adviser.

“The average mortgage customer experience has become increasingly commoditized, with few lenders finding the right formula to build long-term trust and loyalty that truly stands out from the competition,” J.D. Power said in releasing the study results.

According to J.D. Power, six “key moments of truth” determine whether or not a lender is seen as a trusted adviser:

  • Providing advice on customers’ financial situations
  • Explaining the application process
  • Fully answering application-related questions
  • Meeting expectations for what is required
  • Explaining the closing process
  • Providing information about servicing

J.D. Power found that less than half (48 percent) of the nearly 6,000 recent mortgage customers surveyed in June and August said they were kept fully informed in all the phases of the process.

While 40 percent of mortgage customers said they would be willing to complete the entire lending process using self-service digital tools, 67 percent said they had interacted with human representatives via phone.

The number one reason given for choosing a particular lender is the mortgage rate, J.D. Power said, suggesting that lenders may be placing too much emphasis on price and reinforcing consumers’ perceptions that there is little difference between lenders besides the product.

Tom Lawler

“A rising tide of record demand and historically low interest rates hid a lot of the challenges lenders have been facing in forging more meaningful, lasting connections with customers and moving beyond a transactional, rate-driven relationship,” said Tom Lawler, head of consumer lending intelligence at J.D. Power, in a statement. “Now, as the macroeconomic situation has reversed course, these relationship-driven attributes have become critical for lenders that want to convey a more unique value proposition and build more lifetime customers in a highly competitive marketplace.”

J.D. Power 2022 U.S. Mortgage Origination Satisfaction Study

Overall customer satisfaction index ranking, based on 1,000-point scale | J.D. Power

Formerly known as the U.S. Primary Mortgage Origination Satisfaction Study, J.D. Power’s annual survey of mortgage originators was redesigned for 2022.

J.D. Power surveyed 5,915 customers in June and August who had originated a new mortgage or refinanced within the past 12 months, measuring overall customer satisfaction based on six factors: Communication, digital channels, level of trust, loan offering meets my needs, made it easy to do business with and people.

For overall customer satisfaction, the top five lenders on a 1,000-point scale were Rocket Mortgage (750), Chase (736), Citi (733), Fairway Independent (733) and PNC (732).

Also scoring above the industry average of 716 were Ally (731), Bank of America (731), Guaranteed Rate (731), Guild Mortgage (731), Fifth Third Bank (727), loanDepot (722), Caliber Home Loans (718) and Truist (718).

The five lowest-scoring lenders were Freedom Mortgage (663), AmeriSave Mortgage (674), Mr. Cooper (678), CrossCountry Mortgage (680) and U.S. Bank (685). Also scoring below the industry average were PennyMac (687), Better Mortgage (692) and Citizens (710).

Wells Fargo’s score of 716 put it right at the industry average.

While USAA (797), Veterans United (768) and Navy Federal Credit Union (760) scored above the industry average, they weren’t ranked because they did not meet study award criteria, J.D. Power said.

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