DETROIT – Want to lure a first-time mortgage borrower to select your credit union? Offer an attractive deal. Looking for repeat mortgage business? Fast, accurate responses are important when there's a question about the escrow fund or the mortgage statement. That's some of what J.D. Power and Associates found in their latest survey of mortgage borrowers. The marketing information service firm also discovered if you really want to turn off a borrower, sell the mortgage and let them deal with that new firm for servicing. Here's how borrowers ranked various issues, from most to least important: Solve or correct problems. Answer questions. Lender responsiveness. Ease of contacting the lender. Appreciation for the customer's business. Courtesy and friendliness. "There were some eye-openers," says Jeremy Bowler, J.D. Power senior research manager of the study's findings. "You have to understand the point in time in customers shopping cycles. If you were to ask people who are still trying to find a mortgage, I suspect the number one driver would be price. In this study, we started from the viewpoint of existing homeowners who have a mortgage. "In this study, we saw that answering my question or solving my problem is one of the utmost drivers of a customer's overall experience with a lender. The ability of the service provider to fulfill any commitments they make is the number one thing that will drive that customer's satisfaction. They're not buying a near-term product like an ice cream cone. They're buying a relationship." The research shows someone who has only a brief relationship with a lender, generally less than one year, is the least satisfied. They may be struggling with their new debt load. After one, two or three years, satisfaction increases, perhaps as the borrower's income has grown and payments are less burdensome. But after the first four years, satisfaction doesn't grow significantly. One explanation is the consumer has settled into the mortgage. After 10 or 15 years, satisfaction grows again. Bowler notes that about half the sample of current mortgage borrowers were now dealing with somebody other than the original lender. In so many consumer decisions, word-of-mouth from friends or relatives seems to be very important. Is that true when someone is looking for a mortgage lender? "What we've seen in mortgage lending echoes what we've seen in insurance and other financial services we've studied," Bowler responds. "When you ask someone how they chose the company they're with, of course you're going to have comments speaking to the value for money. But a surprising number of people will speak about a referral having led them to the decision to go with Company A as opposed to Company B." If a company develops a relationship with a customer, and that customer is a happy customer, the company is essentially investing in the future, Bowler says. There will be a payoff in two ways. One, that customer or member will return to you again. Second, they will serve as your advocate by mentioning you to other people. What if the credit union sells the mortgage but keeps the servicing so the sale is basically transparent to the borrower? Bowler thinks the member would probably be pretty happy. "It's a topic I've come to learn a lot more about since we released the results of the research," Bowler says. "We found roughly one out of 10 mortgage customers choose to make their payments in person. They walk down to a credit union or a bank branch and they hand over a check. "What's very telling is those people paying in person are much more satisfied with their overall mortgage experience," he continued. "I'm not suggesting that's the only reason they're more satisfied, but I think it does speak to a lifestyle. If you have a relationship with a local credit union or bank, and you're accustomed to visiting that branch on a personal basis, I can very well see you might choose to finance a mortgage through that same branch because you have a relationship." If you really want to wow a member seeking a mortgage, Bowler suggests a good start would be streamlining the process and cutting down on the stacks of evidence a borrower must produce to verify income and other details. Inevitably, he acknowledges, a mortgage is a legal contract that asks for tremendous amounts of personal information. The closing involves countless forms written in obtuse language that isn't exactly friendly to the borrower. Bowling applauds efforts in the mortgage industry to reduce the number of questions and documents required. "I understand Freddie Mac and Fannie Mae are implementing quite a lot of technological improvements that will streamline the amount of information required, especially if someone is a pretty good credit risk. Those efforts make for a better relationship. They can only help," he says. Staff training is also important in keeping the borrower satisfied. "Efforts invested in winning that customer can be undermined if the day-to-day service provider, the call center or the teller at the window, doesn't have a similar philosophy," Bowling said. "Typically what we've seen is call centers are managed as cost centers. They have to get through as many calls as they can within an hour. The operator might hurry through the call just to meet a certain quota. If there's a tradeoff between really satisfying the customer versus managing the cost of that call, I think in some cases we've seen cases where the call center has actually failed to meet the objective from the customer' point of view." -

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