J.D. Power has released its 2022 Mortgage Servicer Satisfaction Study, with New American Funding coming out ahead of the pack.
J.D. Power’s rankings are derived from a March-April survey of customers who have been with their current mortgage loan servicer for at least a year, gauging their satisfaction in six factors. Those factors, in order of importance, are:
- Level of trust.
- How easy the company makes it to do business with them.
- How well the company keeps customers informed and educated.
- People.
- Resolving problems or questions.
- Digital channels.
In its first appearance in the rankings, New American Funding earned a cumulative score of 695 on a 1,000-point scale, highest of all servicers in the study. Rocket Mortgage, which occupied the top spot in the rankings for eight straight years, came in second with a score of 672 and Huntington National Bank was third at 669. The industry average was 607 — 180 points lower than last year’s industry average, although J.D. Power noted that the rankings were completely redesigned between last year and this year.
All three of the top-ranked servicers earned positive reviews from consumers when it came to transparency, underscoring the importance of building trust with customers with mortgage loan delinquencies on the uptick and a looming recession appearing more likely.
“Mortgage servicing has always been an opaque experience for customers with the firms originating, owning and servicing the loans often being different and changing over time,” said Craig Martin, executive managing director and global head of wealth and lending intelligence at J.D. Power. “In a time when brand reputation, customer trust and customer satisfaction are going to be even more critical for attracting and retaining business, different business models will be put to the test in different ways.
“Managing to the average is dangerous,” Martin added. “Firms that are selling the value of the end-to-end relationship and working to build customer advocates will not succeed if they are satisfied with only being technically proficient. Even for firms primarily focused on sub-servicing — an area where compliance, efficiency and resource optimization are paramount — it’s critical to realize that customer perceptions heavily influence actions and, as a result, affect the bottom line.”
“Transparency has become the financial services industry’s favorite buzzword for a reason: customers respond favorably when brands communicate their intentions and provide clear guidance on what is happening and why,” said Tom Lawler, head of consumer lending intelligence at J.D. Power. “The complexity of the mortgage industry creates challenges in customer understanding, particularly when it comes to mortgage transfers. We’re entering a market environment where customer satisfaction is going to play a critical role in the success of mortgage brands, and transparency will be a big part of creating the trust that will determine business success.”
Another big takeaway from this year’s study is the magnitude to which loan transfers harm overall satisfaction and dent trust. Overall customer satisfaction for mortgages that are originated and serviced by the same company was 646, but that score falls to 513 when the mortgage is transferred to a servicer different from the originator. Similarly, scores in the trust component of the study fall 145 points to 511 for transferred mortgages compared to those that are originated and serviced by the same company.
Notably, the originating lender that transfers the loan isn’t immune from customer consequences, with just 15% of transferred customers indicating that they are “very likely” to consider using the original lender in the future.
