Consumers are ready and willing to work with non-banks for their mortgage needs, according to a study from Carlisle & Gallagher Consulting Group (CG). A management and technology consulting firm, CG released findings this week that revealed most consumers would be willing to consult non-bank entities like Walmart and PayPal for their next mortgage loan.
Of the 618 participants included in the survey, CG notes 80% of U.S. consumers would consider a mortgage from a non-bank. Additionally, 1 in 3 consumers would consider a mortgage from Walmart, while 48% would consider a mortgage from PayPal.
The findings are based on consumers’ experiences in the mortgage application process. CG surveyed consumers about their views toward home ownership, including how recent changes within the mortgage industry impacted their application experience, what factors are most important in the application process, and if consumers would be willing to choose an alternative mortgage provider given their experiences.
Current mortgage processes were listed as continued frustrations by participants, leading many to opt for non-bank consideration. High interest rates, high payments and taxes, and escrow were the top three most frustrating issues CG listed among consumers.
Slow execution ranked highest among consumer complaints, accounting for 56% of participants. Communication difficulties clocked in next at 32%. Inability to track mortgage application statuses represented 31% of complaints, and 26% of consumers cited untrustworthy advice for staying away from banks.
“Consumer attitude is driven by three things, price, service and trust,” said Doug Hautop, senior manager and lending practice lead for CG. “Institutions looking to gain market share must target customer values instead of traditional asset segmentation.”
Written by Jason Oliva