Mortgage servicer satisfaction scores rose year-over-year in J.D. Power's 2021 survey, as consumers had increased interaction and engagement with these providers due to economic hardships caused by the pandemic.
But as
"What we find is those customers that don't engage [with their servicer], satisfaction tends to wane a little bit over time, [and] they become less likely to go back to that particular lender because there's no connection," he pointed out.
More than half of the survey's scope covers how servicers communicate with their customers. It found that mortgage servicers learned the lessons from the financial crisis regarding communications and providing help.
But advancements in technology also contributed. "The speed by which [someone] can put in change in the digital world allowed [servicers] to be a little bit more nimble than they probably were 10 years ago," Houston pointed out.
Rocket Mortgage, formerly Quicken Loans, remained the top ranked servicer for the eighth consecutive year, with a score of 860, up six points from the 2020 survey. Among the 32 institutions that received scores, another nonbank, Guild, was second at 825, followed by Huntington National Bank at 824.
The industry average of 787 is six points higher
But the scores are even higher at the lower end of the survey. This year's lowest scorer, Shellpoint Mortgage Servicing, got a 680, compared with 668 one year ago. Last year's low scorer PHH moved up to next-to-last in 2021, but its score improved to 709, a 42 point increase from 667.
But even for the companies at the lower end of the table, it is the attention to improving the process in general — not just a forbearance-related rise — that drove the improved scores, Houston said.
"What people are starting to understand on the servicing side of the business is there is goodwill built around making it easy for the customer to do business with you, even if they're not your best customer," Houston said. "That's the key, you've got to try to create the best process for all your customers, not just your best customers."
Speaking of nonbanks, their average score increased 17 points, even as the banks' average rose just 4 points. So while the banks still have a higher average, the gap shrunk.
Banks typically have more than one product with a consumer, while a mortgage servicer only has that single interaction, Houston said. Therefore it is possible a consumer is having five interactions with a bank that might be poor. But a consumer that has single products with five different providers could be having five good interactions.
"It creates a bit of a lift, not operational but more customer perception-wise," Houston said, adding that nonbanks have invested a lot of money in consumer-facing technology.
Forbearances were not the only reason that borrowers were interacting with their servicers in 2020. Plenty of
"So take away the pandemic which disrupted normal servicing [procedures], and with a huge volume of new mortgages and refinances such that you got both sides of the house cranking — you're paying loans off, you're processing payments, you're bringing new loans on. It was a pretty, pretty hectic period that they did a really good job," Houston declared.
All this returns to making sure the servicer has connectivity and interactions with their customer, especially at a time when many borrowers take advantage of automatic payments for their loan.
Because of that, "there's never any sort of contact with them," Houston pointed out. "Servicers need [to] think about that customer because they aren't going to think about you when they refinance, [so] how do I connect?"
