Are All Problems Created Equal?

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Data from MortgageSAT (100,000+ annual sample size) suggests that no, they are not all equal.  Some problems are far more damaging than others to a borrower’s overall satisfaction.  The problems that cause the least damage are those having to do with the Appraisal Process and the Closing Process, while the most damaging ones have to do with Communication and Time to Complete the Process.

Why is this important?

MortgageSAT data from Q1 showed that 17% of borrowers reported experiencing problems of some kind.  Overall satisfaction dropped from 95 for those who didn’t experience any problems to 68 for those who did.  The good news is that when problems have a positive resolution, nearly 70% of borrowers say they will do business again with the lender in the future.  So, it’s clearly worth trying to resolve as many problems as possible, as well as making efforts to prevent future ones.  When time and resources are short, however, we have to pick and choose where to focus these efforts.

The Diagnosis

Poor communication is the ugly root of many low satisfaction scores. And while it has its own category in our survey, it could arguably be cited as a major factor in many of the other categories too.  Take “Time to Complete Process” for example.  We have some clients who see huge drops in satisfaction after the 45-day mark (application to closing), while others see little to no difference at all.  This is largely a result of the differences in expectation setting from one company to the next, and it all begins with the Loan Officer.  It is the LO’s primary responsibility to shepherd the loan process from start to finish, and when an LO fails to communicate, it leaves the borrower feeling confused and devalued. Communication breakdown tends to happen even more often when an LOA or processor is involved, which takes the LO out of the loop and precludes them from setting proper expectations.  And while technology can help to improve LO communications with the borrower, building a culture of good borrower communications can be achieved without large capital expenditures. In fact, MortgageSAT can pinpoint borrower communication issues at the LO level.

The Prescription

As you may have read in my March Monthly Tip, satisfaction levels are substantially higher when the LO is the sole point of contact throughout the loan process.  So, a great first step toward improving lines of communication is to simply run all communication through the LO.  Secondly, encourage LOs to pick up the phone to give process updates, as that method correlates to the highest overall satisfaction levels. Third, use MortgageSAT to keep LOs appraised of when one of their borrowers was unhappy with their communication. And finally, make sure LOs are attending closings whenever possible.  Many sins can be forgiven simply by having a warm body present to listen and empathize.

Learn More about MortgageSAT and how it can impact you.


Mike Seminari

Ready to learn more about STRATMOR’s turnkey survey solution called MortgageSAT, and how rich, drill-down data can help your company? Contact MortgageSAT Director Mike Seminari at mike.seminari@stratmorgroup.com to learn more.

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