STRATMOR Group: Focus On Customer Experience To Grow In 2022

Virtually every lender wants to grow in 2022, but only those who focus on the customer experience are likely to do so. That’s the conclusion from the December Insights Report from mortgage advisory firm STRATMOR Group. In “Mapping the Evolving Customer Journey,” STRATMOR Customer Experience Director Michael Seminari and Senior Advisor Sue Woodard provide insight into a critical step in creating a positive customer experience (CX): journey mapping.

In a purchase market with rising mortgage interest rates and increasing regulatory compliance oversight, lenders that are intentional about their customer experience will grow faster, protect their margins and gain market share, according to Seminari and Woodard. 

Multiple studies have shown that when it comes to gaining business, the customer’s experience outranks price and fees. In fact, a customer is four times more likely to leave and go to a competitor if a problem in the process is service-related versus price- or product-related.

In one study, 84% of financial services companies that worked to improve their customer experience reported an increase in revenue. Yet most companies don’t have a budget line for CX, nor are they clear on who in the company is responsible for the customer experience. 

“The truth is, every company already has a customer experience. It may not be intentional, and it may not be the one the company thinks it provides or wants to provide. Lenders who put their attention and their budget toward a better customer experience will be the ones that grow,” says Woodard.

However, improving the experience for yesterday’s refinance borrowers won’t be sufficient in a market shifting to purchase money business. While mortgage lenders have built up significant muscle memory for the refinance process, this new market calls for a fresh approach. 

“The customer’s journey in a purchase transaction is significantly different,” says Woodard. “For a refinance, the borrower already has a home and a mortgage. With purchase money loans, the borrower is likely navigating a life change that has led to the new home purchase, and borrowers, loan officers and real estate agents all have a lot to lose if the deal doesn’t go through.”

The key to a better experience lies primarily in the quality of the lender’s communication with the borrower. The problem is that lenders are still thinking about their interactions with borrowers in terms of their own workflows instead of the customer’s journey. 

By mapping out the customer’s journey through the purchase money loan origination process, lenders can improve the experience, opening the door to a more diverse client base, better pull-through, more referrals, stronger relationships with business referral partners and easier recruiting.

“The only real opportunity lenders have to stand out and to grow in 2022 will be to master the customer experience, which now impacts every aspect of every business. The only way to ensure that the customer’s expectations are met is to map out their journey and analyze each touchpoint,” says Woodard.

Customer Experience Director Mike Seminari continues the CX discussion in a second Insights Report article entitled, “Channel ‘Grinch Energy’ for Success in 2022.” In his article, Seminari shares the true meaning of this holiday classic, noting that the story isn’t about the Grinch’s grumpy attitude at the beginning, but rather about his transformation at the end. “Lenders and loan officers alike should be looking for ways to tap into that same transformational energy,” Seminari says. “The true joy is in the personal connections we make, and as an industry, we would do well to remember it’s the personal connections with colleagues, referral partners and with the customers themselves that drive our success and give us a reason to get out of bed in the morning.