Homeowners who originated their mortgages during the peak of the housing boom with unfavorable loan terms are getting more frustrated with their inability to refinance with mortgage servicers, according to the J.D. Power and Associates 2011 U.S. primary mortgage servicer satisfaction study.

Based on the review of nearly 5,000 homeowners regarding their experience working with their primary mortgage servicer, overall satisfaction has declined 29 points from 2010 to 2011, with scores decreasing from 747 to 718 out of a 1,000-point scale.

The study reflects customer satisfaction related to four areas during mortgage servicing including billing and payment process, escrow account administration, website and phone contact.
Customer satisfaction has declined in all four areas this year compared to 2010.

According to the study, the two most important aspects of overall brand image — friendly service and reliability — both received less satisfaction from customers year-over-year.

“Many homeowners who are still in home loans that were originated between 2006 and 2008 would like to refinance, but can’t because they either don’t have enough equity in their home due to falling home prices or their credit profile doesn’t meet today’s tougher standards,” said David Lo, director of financial services at J.D. Power and Associates. “This has become increasingly frustrating to homeowners and a big contributor to their dissatisfaction.”

Lo believes mortgage servicers can increase their overall customer satisfaction relationship by “delivering operational excellence” and “proactive, effective customer communication.” In particularly, he said key aspects to help elevate satisfaction include helping customers understand how their escrow is calculated, effectively resolving recent customer contacts, ensuring customers have a problem-free experience and clearly communicating the servicer’s fee structure with the customer.

“Excellence in mortgage servicing revolves around minimizing problems and addressing them quickly and efficiently when they do occur,” Lo said. “Servicers that excel in these areas benefit from much higher consideration rates for new loans and other products, more recommendations and a more positive perception of their brand.”

For the second consecutive year, the study found BB&T ranked highest in customer satisfaction with primary mortgage servicers, particularly in the areas of billing and payment process and escrow account administration, with an overall score of 768. Regions Mortgage (757) ranked second in the study, followed by Wells Fargo (755).

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