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How Important Is an Initial Needs Checklist?

My wife likes to tell the story of how we first met, which culminates in a teeter-totter moment of decision where she very nearly “swiped left.” To this day, I’m not sure exactly what it was that tipped the scales in my favor, but I do know this: First impressions are important and lasting. In the mortgage industry, and in the loan origination process specifically, there is a critical first impression created when the borrower has completed a loan application and is asked to provide supporting documentation. The way that moment is handled has strong and lasting effects. Is there a “needs list” provided? Is it verbal or written? If it’s emailed, is there any guarantee it won’t get stuck in a junk or spam folder? Our question this month: How important is an initial needs checklist to creating customer delight?

How important is an initial needs checklist?

First impressions are lasting. Providing borrowers with an initial checklist of the documents they will need to provide during the loan process is your first chance to set proper expectations. We’ve learned through the recent refinance surge and COVID-19 experience that setting expectations goes a long way toward helping borrowers feel comfortable, reassured, and safe, which is essential in giving them a delightful experience.

The number one complaint that borrowers have about the loan process is poor communication. Starting on the right foot with communication means providing your borrowers with a clear (and preferably complete) list of items they will need to provide. It seems like a no-brainer that every borrower should receive one of these, yet borrowers continue to check the “No” box when asked if they got one.

In our increasingly paperless world, more and more lenders are employing automated checklists. While this list may evolve as the information provided is reviewed, when lenders give the borrower a checklist at the beginning of the process, the Net Promoter Score (NPS) the borrower gives the lender is a very high 82.

Borrowers who do not receive an upfront checklist quickly get confused and frustrated and NPS plummets to -27. While this does not happen often (less than 5% of the time in our most recent survey period) it means the difference between a borrower who will promote you to friends and family and one who will instead badmouth you.

Chart 1

Source: © MortgageSAT Borrower Satisfaction Program, 2021. MortgageSAT® is a service of STRATMOR Group and CFI Group.

When it goes wrong:

“The overall process would have gone more smoothly if an application checklist had been provided. At times, I felt bombarded by the numerous emails that [my loan originator] sent regarding missing items.”

Borrower, Texas
Custom Satisfaction Score: 6.7/1

The Diagnosis

Ensuring paperless communications reach the borrower, including an initial checklist, is paramount throughout the loan process. If a borrower misses an automated email that they either didn’t see or that went to their junk folder, it’s just as damaging as not receiving a checklist at all. STRATMOR recommends having standard procedures include a follow-up call from either the loan originator or processor to make sure that the customer received and viewed their initial checklist and understands what to provide.

The Prescription

Gaining a referral from your loan process is much like having someone swipe right rather than left on a dating app. Here are three things you can do to make sure your communication starts and goes “right”:

  1. Automate it. With less than five percent of borrowers saying they never got a checklist, it’s a relatively small problem for most lenders. However, one could argue that it should not be a problem at all. Given the many SaaS applications now available that guide borrowers from initial interest through the loan application phase, providing a clear and accurate list of needed items has never been easier. And, the more information you collect during the initial application (and the more consistent that information is), the more accurate your initial checklist.
  2. Call to Confirm. Believe it or not, even some of our clients with fully implemented digital application tools and automated checklists still sometimes have borrowers say they never received a checklist. Perception counts more than reality in the world of borrower satisfaction, so the best way to cover your bases is to encourage the loan originator or processor to call and confirm that the checklist was received. An even better question to ask is, “Do you feel like you understand everything you’ll need to provide us based on the initial list of needed items we sent you?”
  3. Measure Results. At the end of the loan process, make sure your post-close survey is asking the question, “Did you receive an initial checklist of needed items?” Programs like MortgageSAT can make sure this question is asked on every closed loan so that you can ultimately identify and eradicate the sources of the “No” responses.

How can you learn more about creating a better customer experience and about how the customer experience impacts your company?

Find out more about STRATMOR Group’s CX services and how transparency into the loan process can help your company. Contact Mike Seminari at

To see how improving your NPS score translates into real revenue dollars, give Mike a call.

To find more Customer Experience Monthly Tips, click here.

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