People don't have to search far to figure out that the mortgage industry is broken. Every news publication runs stories almost daily to this affect. There are many industry experts looking backward to see what went wrong and they all have well phrased opinions on who's to blame. It's time to stop looking backward and time to look forward to find ways to solve the foundational problems with the industry. The mortgage industry is fundamentally broken. The problem pervades the entire mortgage transaction. What's the problem? Unrealized promises mortgage people have made regarding customer service. Mortgage people relentlessly pitch to the market they offer the highest customer service, concierge level service, or white glove customer service. These taglines have been pushed so hard without any clear difference between them and their competitors, that customers don't believe any of it. After the subprime mortgage debacle, mortgage people should have received a wake up call. Customers are demanding service and the leaders that really offer it at a high level will succeed.
Mortgage people need to tangibly raise customer service through education, over disclosure, and communication. J.D Power and Associates in a survey released October 20, 2008 said that customers are "committed to their lender when the loan officer takes the uncertainty out of the mortgage origination experience by setting expectations, proactively communicating and maintaining personal contact with them during the loan process." The survey also states that customers "are more satisfied when status updates are provided" and "last-minute requests for information are limited." Mortgage people cannot continue status quo when their potential customers are screaming for change. The writing is on the wall - innovate or exit.
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