According to a survey by ICE Mortgage Technology, 84 percent of homeowners who have taken out a mortgage in the last five years only considered one or two lenders before closing the deal.
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A survey of more than 2,000 consumers by ICE Mortgage Technology found that while finding the lowest rate is crucial when choosing a mortgage lender, most consumers still do not bother to comparison shop.
The survey, ICE’s 2024 Borrower Insights Survey, revealed that factors such as cost, speed, and variety of loan terms and products were important to consumers when selecting a lender.
Source: ICE Mortgage Technology 2024 Borrower Insights Survey.
Despite 68 percent of consumers considering the lowest interest rate as the top factor in lender selection, only 13 percent compared rates from three lenders, and just 3 percent compared four or more lenders.
According to ICE Mortgage Technology, “the need for lenders and servicers to use all the tools at their disposal to anticipate the future needs of current customers and avoid losing business to more aggressive tech-savvy competitors” is evident in the survey results.
While 21 percent of consumers cited a referral from a Realtor as an important factor in choosing a lender, only 17 percent valued the availability of a Web or mobile-based application.
Source: ICE Mortgage Technology 2024 Borrower Insights Survey.
Research has shown that obtaining multiple rate quotes can lead to significant savings on mortgage payments, yet many consumers still do not shop around for the best deal.
Various factors, including concerns about credit score impact, satisfaction with the first lender contacted, and the perceived effort involved in shopping around, contribute to consumers’ reluctance to compare rates from multiple lenders.
Consumers are encouraged to utilize mortgage product and pricing engines to obtain custom rates from multiple lenders and to take advantage of tools provided by organizations like the Consumer Financial Protection Bureau to explore mortgage rates and compare costs for related services.
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