A recent survey revealed that despite the current advancements in mortgage tech, borrowers are still not satisfied with the results, saying they need more speed in the process.
Fintech solutions are slowly penetrating the
mortgage industry. Now, tools are available to help mortgage applicants initiate the mortgage acquisition process from checking rates to submitting their documentations. Certain platforms also help borrowers monitor the status of their application, making the procedure more transparent.
Indeed, digitization is helping streamline the antiquated process of getting a mortgage. But even with these revolutionary developments, borrowers remain unsatisfied with the pace, asking for more speed for the origination of their loans.
This is the consumer sentiment that
J.D. Power found out in its annual customer satisfaction ranking of originators.
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The survey revealed some very notable findings. For the first time, online became the most favorable platform for application for both purchases and refinances. Compared to only 28 percent a year ago, 43 percent of the responders said they applied online for a mortgage.
But along with the increase in users is also the glaring emphasis of the customer’s dissatisfaction in the platform. Compared to in-person applications, borrowers are also 10 points less satisfied of online submissions.
“We’re at a critical inflection point in the mortgage industry where new technology and the growing use of digital mortgage application channels has made it possible for the origination process to move more quickly; however, the customer is still the final judge of speed and quality,” J.D. Power’s director of the mortgage practice Craig Martin said.
He attributes the low satisfaction rate to the technology’s failure to set proper expectations among their customer base. He noted that these applications were unaided by humans to complete.
Quicken Loans’ high satisfaction rate is driven by their ability to provide their clients with status updates. This gave customers enough ease that the process is ongoing. However, the average processing time for the loans took longer than they did a year ago, which led to the an eight point lower satisfaction rating average for mortgage originators.
There were also more purchase transactions than there are refinances for this year.
Guild Mortgage tied up with Quicken Loans at the number one spot in satisfaction ratings, followed by PrimeLending, Regions Bank at number 3, Fairway Independent Mortgage at number 4, while Guaranteed Rate and PennyMac tied for the fifth place.
Areas for improvement
The results of the survey seem to highlight these most important facts:
Human factor. Although the goal of mortgage tech is to eradicate manual input in the mortgage process, users exhibit more trust to platforms that still incorporate humans as part of its dynamics.
Setting of expectations. Mortgagors should be able to adequately guide the platform user or borrower about the limitations of the process so they would know what to expect and where to get assistance should there be a need for any.
We’re at a critical point of adaptation. Because mortgage tech came in later relative to the ripe advancements in the media and transport industry, users or borrowers already have high expectations about what digital platforms can deliver.
Unfortunately, we still have a long way to go. But the preferential shift to online platforms already signals that we’re indeed in the right direction.
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