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J.D. Power and Associates Ranks USAA Highest in Customer Satisfaction
By James Comtois
USAA Federal Savings Bank ranked the highest in customer satisfaction with mortgage servicing in the 2006 Primary Mortgage Servicer Study by J.D. Power and Associates.
The 2006 Primary Mortgage Servicer Study, fielded by the Westlake Village, Calif.-based marketing information services firm in March and April 2006, is based on responses from 12,799 homeowners regarding their experiences with their primary mortgage servicer. It measures customer service with the process of servicing a loan based on four primary areas: the administration of the customer's account, the billing process, the payment process and the process of contacting the mortgage servicer if necessary.
Based on a 1,000-point scale, recording the highest ratings in each of the four factors by a wide margin, San Antonio-based USAA Federal Savings Bank received an overall customer satisfaction index score of 897. BB&T (with a score of 861) and Citizens Bank (844) follow USAA in the rankings.
"USAA Federal Savings Bank is simply doing things right and doing them right the first time," said Rocky Clancy, executive director of the banking and mortgage practice at J.D. Power and Associates. "When USAA makes commitments to their customers, they meet those commitments. Customers will often forgive mistakes, but they tend not to forgive broken promises. Problems are inevitable, but having a proper approach to those issues can speak volumes."
The study found that nearly one-half (45%) of mortgages do not remain with the originator for servicing at some point after the loan is closed. On average, customer satisfaction scores are 32 index points lower among customers whose mortgage is passed on to a different company.
"While this is common practice in the industry, removing the homeowner from the decision to sell the mortgage to a different company for servicing can create confusion and a sense of betrayal among customers," said Mr. Clancy. "Removing the customer from the decision making in such a big part of the mortgage process takes away some of their sense of empowerment. Customers want stability and consistency with their home loans and lenders who can deliver those are rewarded with customers who are not only more satisfied and loyal, but also have twice as many additional products with the lender."
The study also found that nearly 50% of customers now pay their mortgage bill electronically, compared to just 34% two years ago. Electronic payments, whether automatically deducted from a customer's bank account or made online, result in higher customer satisfaction levels overall.
"The more billing and payment of mortgages is automated or conducted online, the more consistent and accurate loan servicing becomes, ultimately leading to higher levels of customer satisfaction. The bottom line is that satisfied customers require less contact with their servicer's customer service department, resulting in lower servicing costs for the lender. In addition, mortgage servicers who are successful in satisfying their customers can expect greater revenue as a result of customers recommending the company to others more often and obtaining additional non-mortgage services from the lender."
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