Mortgage Shopping Not Practiced by Nearly Half of Borrowers

The share of borrowers reporting that they have considered only one lender for their mortgage loan is 47%. This is revealed in the National Survey of Mortgage Borrowers conducted by the Consumer Financial Protection Bureau (CFPB) among borrowers who purchased a home in 2013.

The share of first-time who buyers who did not compare different lenders is just slightly lower – 44.5%. Less than 5% of all borrowers compared the mortgage products of five or more lenders.

The share of borrowers who applied to just one lender is 75%. Even though more than half of borrowers engage in comparison shopping and consider more than one lender, the only 25% make an application to two or more lenders. The share of those who applied to four or five lenders is around 5%.

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Over 80% of the people who applied to more than one mortgage lender did because they searched for better terms. Nearly 35% of this group made two or more applications out of concern that they would not qualify for a loan. Our of the borrowers who made multiple applications, approximately one in five did so due to previous rejection for a mortgage loan.

The survey found that 70% of borrowers relied extensively on a loan officer or a broker for obtaining the mortgage information which they required from. The conclusion of the survey is that while these professionals are valuable sources of information, they have a stake in the outcome and their goals may differ from those of borrowers.
More than half of borrowers (55%) are familiar with mortgage rates while 30% are not familiar with them at all. Those with knowledge on the rates are two times more likely to shop around.

The results of the survey were presented at the launching of Owning a Home, the new CFPB toolkit for assisting prospect borrowers in mortgage shopping.

Christian

Christian

Christian Calvin mortgage Christian is a contributing writer for Mortgage.info. He is a graduate from the University of Tennessee with a degree in Communications and a concentration in Broadcasting. Christian has served as vice-president for a privately-held company for more than 20 years. Additionally, he has also applied his writing and business knowledge to various websites with a focus on business and sports news . . . both of which are passions. Christian enjoys playing golf and spending time with his family and friends.

Contact: christian@mortgage.info
Christian

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