Overall customer satisfaction with mortgage lenders reached a six-year high in the J.D. Power and Associates 2012 U.S. Primary Mortgage Origination Satisfaction StudySM released today, rising from 747 on a 1,000 point scale last year to 761 this year.  It was the second straight year that the average increased and of the 15 companies rated, five scored above that average and nine below.

The 2012 U.S. Primary Mortgage Origination Satisfaction Study is based on responses from more than 3,500 customers with a recent new mortgage. The study was fielded between July 31 and August 27, 2012.

Quicken Loans led the list with 817 points while Bank of America was at the bottom in customer satisfaction with 696 points. 

The company said the increase in customer satisfaction is driven by steady improvements related to transparency and communication. The study finds that during the past three years, lenders have improved in the areas of clearly explaining loan options and ensuring customers understand them; following up with customers in a timely manner after they complete their application; and proactively updating customers on the status of their application.

"Given the recent challenges across financial services, the highest-performing lenders in the 2012 study have reduced customer uncertainty and apprehension with greater transparency and communication regarding what to expect in the origination process," said Craig Martin, director of the mortgage practice at J.D. Powers.  "This increase in satisfaction is particularly impressive given the increasingly expanded origination timelines during the past year."

The company said there is a strong relationship between satisfaction with the origination process and the rates of customer consideration and usage of the same lender for refinancing. Among loan customers who have refinanced in 2012, only 40 percent cite price as their main reason for selecting their lender. Other reasons commonly cited for selection include an existing relationship; previously being a customer; and referrals. 

Overall satisfaction with a lender was based on customer satisfaction on a scale of one to five in four key areas of mortgage origination; the application and approval process, the loan representative, closing, and contact.  A score of three indicated customers considered the lender "average."  Quicken scored five ("among the best") on all four measures while BB&T received a four ranking ("better than most") on each.  This is the third consecutive year that Quicken Loans has ranked highest among primary mortgage lenders.

J.D. Power and Associates offers the following tips for consumers when selecting and working with a mortgage lender:

  • Research and understand the different types of loans available, and be sure to consider more than just the interest rate while shopping.
  • Expect the mortgage origination process to take longer than it did a few years ago as a result of increased regulations and scrutiny.
  • Ask whether technology solutions such as special website access or mobile apps are available to help you track the progress of our application.
  • Understand the relationship you'll have with the lender you select and whether it will ultimately service your loan.
  • Inform your loan representative how you prefer to be contacted-e.g., via email, phone or mobile.