According to a survey by ICE Mortgage Technology, 84% of homeowners who took out a mortgage in the past five years only considered one or two lenders before closing.
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According to a survey of more than 2,000 consumers conducted by ICE Mortgage Technology, the most important factor for consumers when choosing a mortgage lender is finding the lowest interest rate, but most consumers find comparison shopping too tedious.
ICE’s 2024 Borrower Insights Study surveyed an equal number of homeowners and renters and found that the most important factors when choosing a lender are cost, speed and the ability to choose from a variety of terms and products.
Source: ICE Mortgage Technology 2024 Borrower Insights Survey.
While 68% said finding the lowest interest rate was the most important factor in choosing a lender and 48% cited low lender fees, time to closing (33%) and variety of loan terms and products (32%) may also influence the decision-making process.
Only 21% said a referral from a real estate agent was one of the most important factors when choosing a lender, and only 17% of those surveyed said the availability of a web or mobile-based application was important.
Source: ICE Mortgage Technology 2024 Borrower Insights Survey.
Given that costs can vary widely between mortgage lenders, it may be surprising to learn that 84% of homeowners who took out a mortgage in the past five years only considered one (36%) or two (48%) lenders before closing.
Last year, Freddie Mac released the results of a study showing that borrowers who got two interest rate quotes could save $600 a year on their mortgage payments, and those who got at least four could save more than $1,200 a year.
Another study by the Consumer Financial Protection Bureau (CFPB) highlighted the importance of comparing FHA, VA, and jumbo mortgages because of the wide variation in interest rates offered by lenders offering these types of loans.
However, a survey by ICE Mortgage Technology found that only 13% of borrowers compared rates from three lenders, and only 3% compared four or more lenders.
In its July 2024 ICE Mortgage Monitor report, ICE said its findings highlight the need for “lenders and servicers to take advantage of all the tools available to them to anticipate the future needs of their current customers and avoid losing business to more aggressive, tech-savvy competitors.”
Our mortgage products and pricing engine make it easy for borrowers to get custom rates from multiple lenders. Credit bureaus do not penalize borrowers Users who rate your store within a concentrated period of 30-45 days.
So why don’t home buyers shop around for the best deal?
A Zillow Home Loans survey found that among people who are less likely to comparison shop for the best interest rate:
- Thirty percent were worried getting multiple quotes would hurt their credit score.
- 24% were satisfied with the lender they first contacted
- 19% say shopping takes too much time and effort
- 15% thought all lenders offered the same interest rates
- 14% felt embarrassed about sharing financial information with lenders.
The Consumer Financial Protection Bureau warned last year that some comparison sites that claim to help borrowers shop for interest rates may be violating the law by steering borrowers to lenders who pay an access fee.
The CFPB also Mortgage interest rate research tool Provided by Curinos, which collects data directly from lenders, the CFPB advises consumers to compare the costs of obtaining a loan once a lender has been decided. Title Insurance Payment services.
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