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- Bank-affiliated servicers are lagging behind non-bank services.
- Forbearance is driving this years boost in customer satisfaction but isn't expected to last much longer.
- Banks see gains in satisfaction across non-mortgage services.
- Online engagement and self-service channels are areas that need improvement.
All across the industry, mortgage servicers earned higher levels of customer satisfaction during the COVID-19 pandemic, as overall satisfaction increased by a significant six points this year (on a 1,000-point scale) through a combination of relief efforts and quick pivots to digital solutions, according to J.D. Power 2021 U.S. Primary Mortgage Servicer Satisfaction Study.
Despite this good news for servicers across the board, bank-servicers, in particular, have some challenges on the horizon that will need to be addressed sooner than later. As loan forbearance programs come to an end and more normalized customer interactions resume, traditional banks are starting to lose their edge over non-bank lenders, according to the study.
"Mortgage servicer satisfaction was buoyed by the industry’s response to the pandemic, with some of the biggest gains in customer satisfaction being driven by at-risk and moderate-risk customers who participated in forbearance programs,” said Jim Houston, director of consumer lending intelligence at J.D. Power. “However, as we look at post-pandemic customer behaviors and responses of low-risk customers, we see that lift in satisfaction may be short-lived. In fact, despite the attention on relief programs, nearly one-fifth of current mortgage customers have had no interaction with their servicer during the past year. Mortgage servicers will really need to up their customer engagement games as the marketplace stabilizes.”
Bank-affiliated servicers saw a six-point increase in overall satisfaction, however, this pales in comparison to the 17-point increase for non-bank servicers. These results break the traditional norm or bank-affiliated servicers outperforming their non-bank counterparts.
The study does note that the large increases in customer satisfaction were largely driven by at-risk customers. According to J.D. Power, overall satisfaction among at-risk customers increased by 15 points year-over-year, with low-risk customers' overall satisfaction falling by one point.
“Higher overall satisfaction scores for bank-affiliated servicers are inflated by non-mortgage services,” according to the study. “Satisfaction scores among customers who also use their servicer’s bank products are 55 points higher than among those who have mortgage-only relationships.”
As for areas of improvement, the study showed that website usage was up five points this year but there is still room to grow in the online channel. Just 38% of customers were able to find the information they needed within the first two pages of servicer sites.