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D+H Consumer Mortgage Study

D+H report cover

D+H released some useful new mortgage consumer data last month, and it yielded some surprises. I covered a few of the key findings in this Globe story over the weekend, but below are the stats in more detail. (Our comments in italics.)


The study segmented consumers into two types:

  • ‘New’ borrowers, or those originating a new mortgage on a new property
    • Two-thirds of these folks are first-time buyers
    • They tend to be younger, more likely to use a broker, more likely to buy additional products (e.g., Mortgage Insurance, Line of Credit) and more nervous at the beginning of the mortgage process
  • ‘Re/Re’ borrowers, or those renewing or refinancing an existing mortgage
    • These folks tend to be older, more confident and much more likely to use a bank or credit union/CU

Transaction Types:

D+H says mortgage transactions can be broken down as follows:

  • 47%: Renewals of existing mortgages
  • 18%: Refinancing of existing mortgages
  • 24%: New mortgages – First-time buyers
  • 12%: New mortgages – Prior mortgage experience

Where people got their mortgage:

  • 62%: Obtained their mortgage through a bank
  • 29%: Obtained their mortgage through a broker
  • 8%: Obtained their mortgage through a credit union

How applications are taken:

  • 62%: Completed their application at a broker’s office or a lender’s branch
    • For the majority, personal one-on-one service still wins out
  • 11%: Were taken by phone
  • 10%: Used an online form
  • 7%: Had an adviser come to their home
  • 7%: Met an adviser at a local coffee shop or restaurant
  • 36%: Completed a paper application

Approval times:

  • 1 day: The median time for approval
  • 15%: Received approval in a week or longer
    • It boggles the mind how some “A” lenders think an approval in 5+ days is reasonable


  • 72%: Obtained one or more additional products with their mortgage
    • 36%: Mortgage Life Insurance
    • 30%: Line of Credit
    • 24%: Appraisal (We wouldn’t have included appraisals as a “product” for these purposes, but anyway…)

Individuals vs. Institutions:

  • 63%: Said they value the individual over the institution
    • Individuals matter more, but the reputation of the financial institution becomes increasingly more important to the older age groups

Information Sources:

  • 72%: Sought information on rates from their own financial institution (FI)
  • 54%: Sought information from other FIs
  • 31%: Sought information from brokers


  • 48%: Of previous applicants feel they could do everything themselves online for their next mortgage
    • The exact question D+H asked respondents was: “Having gone through the mortgage process, do you feel confident that should you need to obtain another mortgage in the future, you could do everything yourself online?” 
    • Near half is almost unbelievable. Does this reflect some overconfidence, or a consumer that is coming of age given today’s breadth of online mortgage tools?
  • For those that did not think they could do it alone, the biggest barriers were needing help/advice (32%), not knowing enough (22%) and not being confident enough (17%)


Knowledge of Mortgage Terms

Borrowers had a good working knowledge of some terms, and others, not so much:

  • 86%: were aware of the term “pre-approval”
  • 84%: were aware of the term “closed term mortgage”
  • 81%: were aware of the term “amortization”
  • 55%: were aware of the term “rate hold”
  • 49%: were aware of the term “high ratio”
  • 43%: were aware of the term “portable”

Research Habits – Segment Difference

  • 58%: Of new mortgage applicants are likely to search for how much mortgage they could qualify for
    • Vs. 25% for “Re/Re” applicants
  • 58%: Of new mortgage applicants are more likely to search for who could provide their mortgage
    • Vs. 24% of “Re/Re” applicants
  • 41%: Of new applicants are likely to search for what documentation is needed
    • Vs. 26% of “Re/Re” applicants
  • 30%: Of new applicants are likely to search for what steps are involved in the mortgage process
    • Vs. 13% of “Re/Re” applicants

Decision Drivers (All shares sum to 100%)

Of all the factors impacting where to get their mortgage:

  • 17%: said the “mortgage rate” had the highest importance
  • 12%: said “no unexpected charges”
  • 12%: said “special mortgage features”
  • 33%: Of applicants said the ability to only get a mortgage online was a barrier to selecting that provider

Best and Worst:

In rating the mortgage process:

  • Highest grades (A/A+) were from applicants who had time to read the documents before signing, who were dealing with an originator they knew, and who completed the application verbally
  • The worst grades (C) were from applicants who felt pressured to sign documents without the time to read them, who were also under time pressure to close, and who had completed a pre-approval

Location of Application Completion

  • Those who complete the application at home were more positive about the application process overall
  • Those who complete the application in an office or branch give higher grades than do those who completed the application on a website
    • This and the stat above it support the concepts of mobile mortgage specialists and brokers who make house calls
  • The entire process was deemed slightly less positive if paper forms were used

Sore Points in the Process

What caused the most pain during the mortgage process:

  • 30%: said it was the “amount of paperwork” involved in the application process and fulfilling conditions
  • 27%: said it was the fact of being “unsure if I got the best rates”
  • 20%: said it was finding time to meet with the broker/bank rep/credit union rep

Information sought before start of the transaction

  • 72%: searched for the rates being offered at their financial institution
  • 54%: searched for the rates being offered at other financial institutions (banks/credit unions)
  • 31%: searched for the rates being offered by mortgage brokers

Consumer survey 2

Best Sources of Information

Here is what people called the best sources of mortgage information:

  • 35%: said a bank branch/credit union
  • 21%: said a mortgage broker
  • 17%: said online through a bank/credit union website
  • 7%: said online information (in general, e.g., through Google search, etc.)
  • 7%: said online through a mortgage website(s)

Top Reasons for Not Using the Same Mortgage Originator Again

  • 56%: because they had a bad experience or dispute with them in the past
  • 51%: because they did not provide the best rates
  • 40%: because they “made me feel pressured”


Survey Details:  D+H conducted this survey online in September 2015 and used a sample size of 400 consumers who had completed a mortgage transaction in the past 18 months. The study included borrowers from both the retail and broker channels. Here’s the full report.