Mortgage servicers must improve customer service to promote borrower loyalty and stand out from the competition. According to the Mortgage Bankers’ Association, only 17% of borrowers plan to return to their same mortgage servicer for another loan.
Additionally, J.D. Power’s 2019 U.S. Primary Mortgage Servicer Satisfaction Study, stated mortgage servicers were at the bottom of the industries studied with a score of 777 out of 1,000. The only other industry with a lower satisfaction score was health plans at 712.
Many borrowers don’t choose their mortgage servicer but wind up with them when the servicer purchases their loan in the secondary market. Unfortunately, borrowers transferred to a third-party servicer have significantly lower satisfaction scores and more payment and escrow account issues than borrowers who chose their mortgage servicer. Borrowers selected their lender and desire to continue doing business with that lender, not an unselected third party. According to the JD Power survey, 54% of first-time homebuyers say they are confused, angry, or irritated when they’re transferred.
Mortgage servicers can improve the borrower experience by offering more personalized customer service through direct
communication, providing easy outlets to make payments, and efficiently administering escrow. By automating routine functions, servicers have more time to respond to borrowers’ unique needs. Application Programing Interfaces (APIs) and web applications improve efficiency, helping servicers deliver a better customer experience. COVID-19 has heightened the need for personalized service to navigate through forbearance and repayment options.
APIS IMPROVE EFFICIENCY BY AUTOMATING PROCESSES
APIs are software-to-software interfaces that enable applications to easily communicate back and forth without the need for user awareness or intervention. They can be used both internally and externally for individual companies or organizations or made available to any party interested in developing an interface or connection to their product or service. According to a recent Fannie Mae survey, mortgage lenders view APIs as the top
technology that has potential to improve or streamline processes.
One of the biggest benefits of utilizing APIs is the workflow-automation they provide. Used in conjunction with an automation or scheduling tool, an API can automate the execution of mortgage servicing software programs—such as end-of-day and end-of-month reports, investor close out, monthly loan statements, and programs such as bank/credit union core interfaces.
Increased automation provides ample benefits for servicers, such as reduced staff hours and monetary costs, fewer errors, and more seamless operations. APIs also benefit borrowers, who desire quick, convenient transactions. By using APIs, servicers can increase their efficiency and eliminate much manual labor, allowing them to more quickly and accurately deliver statements and loan information to borrowers via a consumer-facing website. Borrowers gain immediate, real-time access to their specific loan data and statements and can conveniently make online payments 24/7.
STREAMLINING PROCEDURES WITH WEB APPLICATIONS
Borrower-facing web applications allow servicers to exchange information with borrowers in real time, increasing both the efficiency of the process as well as the borrower’s satisfaction. Web applications provide immediate access to mortgage information and statements, reducing routine phone calls from borrowers, and saving staff time. Servicers can use that extra time to provide personalized service to borrowers—such as those requesting forbearance due to the COVID-19 pandemic—who need or prefer to communicate by phone or in person. According to the J.D. Power survey, only about 60% of borrowers access information via their mortgage servicer’s website and 31% via mobile. Despite relatively low usage of digital channels, overall customer satisfaction is highest among borrowers who use them.
Environmentally conscious borrowers, particularly the millennials and Gen Z, want to be able to opt out of paper statements and receive documents electronically. Web applications provide 24/7, paperless access to loan information and allow multiple options for online payments. By providing convenient, online payment options, servicers can encourage borrowers to make their mortgage payments on time or even early.
Web applications allow borrowers to store digital versions of their mortgage documents, so they won’t misplace paper copies and call the servicer requesting a historical statement. Web applications allow servicers to send automated email messages to borrowers, encouraging them to view their statements and notices online. Servicers can also send personalized messages to borrowers to read once they log in to the web application. These messages are a great way to update borrowers regarding their forbearance request and repayment terms.
APIs and web applications streamline mortgage servicing operations, saving time, and money and benefiting borrowers and servicers. Convenient, 24/7 access to mortgage information and online payment options are essential to satisfy today’s borrowers. By using APIs and web applications in conjunction with mortgage servicing software, servicers can improve borrower satisfaction by communicating and sharing information quickly and accurately.