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Homeowners are increasingly satisfied with mortgage servicers according to a recent study from J.D. Power, a positive sign as interest rates begin to fall.

While mortgage providers such as Rocket Mortgage and Regions Mortgage top the satisfaction list, Chase came in third. Bruce Gehrke, senior director of lending intelligence at J.D. Power credits improvemenats in digital tools and the overall customer service experience as drivers behind homeowners’ happiness.

“On the surface, mortgage servicers’ efforts to elevate their digital tools and customer service are offsetting challenging market conditions,” Gehrke said in a statement. “But digging a little deeper, the data shows early signs of potentially serious challenges for servicers in the future. A proverbial ‘canary in the coal mine’ is the financial health of borrowers, which has materially declined in the past few years. At the same time, most borrowers are facing rising escrow costs that result in their total monthly mortgage payment increasing. This means the industry has a growing number of at-risk customers facing higher costs, a group that tends to be a lot more expensive to service.”

The “canary in the coal mine” in this case is a decline in borrowers’ financial health and rising costs. 41 percent of borrowers are currently classified as financially healthy, down from 46 percent in 2023 and 52 percent in 2022. Also, at-risk borrowers increased to 19 percent, up from 17 percent in 2023.

J.D. Power also noted that 56 percent of borrowers are experiencing an increase in escrow costs this year. Among borrowers whose escrow costs increased, overall satisfaction is higher among those who stated that they had access to tools on escrow from their servicer compared to those who say they were not aware of such tools.