Just this morning we covered a few of the results found in CAAMP’s Highlights from CAAMP’s Fall 2012 Consumer and Industry Surveys report. Those results, focusing on things such as the financial situation of Canadians, and how we as a country feel about the mortgage and housing industry, showed a disconnect. While Canadians surveyed indicated that they felt very positive about their own financial health, they also showed concern regarding the debt of others, home prices, and the fact that the majority felt people were living in homes they couldn’t afford.
The results were interesting to say the least, but amid all the financial situation meanderings, there was one disconnect that was particularly interesting to us – that was the role of mortgage brokers. While the individuals surveyed seem to believe that mortgage brokers could help others in many different types of property transactions, they don’t seem to think that using a mortgage broker would be beneficial for them. This can be found in the chart below.
One of the most interesting things about the results is that many mortgages could be considered as either a first-time homebuyer’s mortgage or an expiring mortgage term. And the results indicate that these are two areas where survey participants feel that a broker would be most beneficial for other homebuyers and homeowners. However, what’s interesting is that only 25 per cent of those same participants felt as though a mortgage broker would be helpful to them.
So what’s the reason for it?
According to CAAMP, it’s because consumers view mortgage brokers as having two important attributes – functional attributes, and emotional attributes. And when they consider whether or not a broker would be good for other consumers, it’s functional attributes that they’re considering. But when they need to look inward and decide whether or not a broker is the right answer for them, it’s the emotional attributes that they consider.
The functional attributes are those that look good on paper. These are things such as the attractive rates that brokers can find within their network, the speed of which they can obtain approvals, and the sheer volume of lenders within one broker’s network. These are all reasons why those surveyed said that they thought a broker would be good for others. But when it comes to whether or not consumers would personally feel comfortable working with a broker, the results are very different. And that’s largely because, as CAAMP suggests, they just don’t feel as though they can connect with brokers on a personal and emotional level.
That personal connection typically comes from how consumers view a mortgage broker’s brand. Whether or not they see it as old or young, flexible or rigid, or personal versus inaccessible – these are all parts of a mortgage broker’s brand, and they’re the elements that come into play when consumers are deciding whether or not a mortgage broker would be good for them. They’re also the reason why three-quarters of people feel they wouldn’t be.
So, what’s the answer to breaching this disconnect between mortgage brokers and their customers?
CAAMP says that the responsibility falls on the brokers themselves; and that it’s their job to better their brands, and start reaching out to customers on a personal and emotional level.
Their report states,
“We believe increased broker focus and attention on a few key details of the customer experience may be able to address nearly all of these shortcomings on key emotional drivers. Improved communications to clients during the mortgage process that reinforce the positive aspects of the mortgage [provided] to them, the stability of the lender, and transparency about the broker income structure, could go a long way to addressing many of these emotional drivers.”
What do you think? What has your mortgage broker experience been? Do you think that in the industry as a whole, there’s room for improvement?