Transform Mortgage Servicing With Conversational AI

With the accelerating pace of change in the mortgage industry, servicing needs a new way to build stronger customer relationships. Digital engagement in mortgage servicing is central to a customer experience (CX) strategy.

Borrowers increasingly prefer self-serve options since it saves them time and leads to a better overall experience. Customer facing chatbots based on conversational artificial intelligence (AI) are increasingly used by mortgage servicers. It provides borrowers an opportunity to connect instantly, seek information fast, and – often – find a solution within minutes. In a study conducted by PwC, 27% of consumers reported that they weren’t sure whether their most recent customer service interaction was with a human agent or a chatbot. The conversational AI market is now exhibiting strong growth and is expected to reach US$23 bn in 2027.

This technology is evolving at the same time as the loan servicing sector of the mortgage industry is struggling with customer retention. According to data from Black Knight’s Mortgage Monitor in Q4 2020, retention of refinancing borrowers remains at record lows, with just 18% being retained by their servicers. These low retention rates reflect the overall dissatisfaction consumers have with their mortgage servicers.

According to the J.D. Power, the COVID-19 pandemic has amplified the gaps in digital experience and call center experience. The study indicates that 45% of customers who visit their servicer website are unable to resolve their issue and end up resorting to contacting an agent by phone. And nearly one-fifth of customers do not find the process easy.

Despite these challenges, there are ways that servicers can improve the customer experience – and, by extension, customer retention rates. The arrival on the scene of more developed conversational AI and chatbot technology is a great opportunity for mortgage servicers to provide customers with a self-service portal they can rely on.

This white paper outlines how servicers can use conversational AI technology to increase both customer satisfaction and retention.