Consumers Weigh Closing Costs, Customer Service When Choosing a Mortgage Lender

When selecting a mortgage lender, a vast majority of consumers say that a lender’s reputation for service is nearly as important a factor as interest rates and closing costs, according to a new study released today by Ally Bank. Virtually all respondents said they consider interest rates and closing costs an important factor, while 93 percent said they would weigh a lender’s reputation heavily when making a decision.

Eighty-one percent of Americans who have had a mortgage or plan to apply for one in the future said that total closing costs did or would factor significantly into their decision. Of those, four in five said that they would be influenced toward one lender over another by a $500 incentive to help offset costs.

Eighty-five percent of past or present homeowners said they were somewhat or very satisfied with the mortgage application process, while the remaining 15 percent were not satisfied. Key reasons for dissatisfaction were poor customer service (48 percent) and poor communication (46 percent). Nearly 40 percent expressed dissatisfaction over high closing costs.

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