• by Tanya Gazdik , November 28, 2010

Quicken Loans leads mortgage providers in customer satisfaction, even though overall satisfaction in the category has declined due to an increase in time from application to approval, according to J.D. Power and Associates.

The "2010 U.S. Primary Mortgage Origination Satisfaction Study" measures customer satisfaction in four key factors of the mortgage origination experience: application/approval process; loan officer/ mortgage broker; closing; and contact.

Quicken Loans ranks highest among primary mortgage lenders with a score of 826, and performs well in all four factors. MetLife Home Loans (808) and PNC/National City Mortgage (776) follow Quicken Loans in the rankings.

The study finds that the time from application to approval has increased to 27.5 days in 2010 from 20 days in 2009. As a result, the time frame for the entire origination process has increased to 52.1 days in 2010 from 46.9 days in 2009. Consequently, overall satisfaction has decreased to 734 (on a 1,000-point scale) in 2010 from 739 in 2009.

However, Detroit-based Quicken Loans' average time to complete a mortgage is just over 30 days. In addition, Quicken Loans maintained its industry leading closing times by processing nearly 75% of its loan closings in 28 business days or less.

"Customer preference, and more importantly, perceptions, continue to increase with the online direct channel," said David Lo, director of financial services at Westlake Village, Calif.-based J.D. Power and Associates. "Online lenders such as Quicken Loans do a very good job of keeping their customers informed of the process every step of the way by providing periodic status updates and information pertaining to their loan."

The study finds that the most important best practices, which are most closely associated with high levels of satisfaction, are: providing proactive updates on the status of the loan, providing a welcome acknowledgment after an application is submitted, avoiding asking for the same information more than once, closing on the promised date, clearly explaining loan options and ensuring that the customer understands and clearly explaining the entire process from application to approval.

The study also reveals that online loan applications continue to rise, with nearly 20% of all customers beginning their mortgage process online. This represents a 6% increase from 2009. More consumers are managing their mortgage applications remotely, and 50% of all clients never had a face-to-face meeting with their mortgage banker.