Mortgage Firms Prep For Post-Refi Boom Times, G�mez Scorecard Reveals

IndyMac regains top spot from a highly competitive Countrywide by making major homepage enhancements and functionality upgrades to its online offering in the Q2 2003 ranking

Waltham, MA, April 8, 2003 — As the extended refi boom winds down, mortgage firms are reinforcing educational content and financing calculators aimed at novice homebuyers, according to the Q2 2003 Internet Mortgage Scorecard released today by G�mez, Inc., the leading provider of Internet Channel Effectiveness solutions.

In a hard fought battle, IndyMac Bank Home Lending regained the Scorecard’s top spot by edging out Countrywide Financial on the Q2 2003 ranking (Countrywide ended Indymac’s streak of five consecutive top finishes in the Q3 2002 ranking). As with our previous evaluation, the two top competitors split top billing among the Scorecard’s four categories: Countrywide once again prevailed in Customer Confidence and On-Site Resources, while IndyMac finished atop the Ease Of Use and Relationship Services.

But as the two-year-long refinance boom gradually recedes, firms are focusing on content and tools that appeal to first-time and second-time home buyers. For example, Quicken Loans is boosting its outreach to novice homebuyers by offering to mail offline documents related to its “Free First-Time Home Buyer Advantage Program” (a home affordability worksheet and home buying checklist). Wachovia, meanwhile, initiated a service that transmits a series of e-mails to first-time homebuyers, replete with mortgage payment and affordability calculators as well as useful educational content.

Still, mortgage firms are not forgetting about existing customers. As in other financial services segments, some firms are pre-populating online applications with information already on file for existing customers — be it for new mortgages or refinancings.

“Mortgage firms must continuously improve their online offerings by providing usability and functionality improvements as well as guidance necessary to enable first-time and return customers to comfortably complete what is traditionally a complicated and confusing process,” noted Shalin Patel, the G�mez analyst who managed the Q2 2003 Internet Mortgage Scorecard. “Initiatives such as home-buying primers and affordability calculators, however, reinforce the notion that Scorecard firms are working towards a future that will be dominated by first-time or second-time home purchasers rather than the refinancing segment that has driven online growth during the last two years.”

G�mez evaluated more than 100 firms to determine the ultimate top 15 online mortgage providers for the Q2 2003 Internet Mortgage Scorecard. Highlights from our Scorecard research include:

  • IndyMac’s top finish spurred by its homepage revamp. For example, Indymac now makes its QuickPricer more prominent on its homepage. It is also more visibly promotes guarantees (a response time guarantee that pays $300 at closing if the applicant is not contacted within three hours of a submitted application is presented within key homepage real estate). Also best of class are Indy Mac’s new “should I pay points calculator” and a “free home evaluation tool,” which allows customers to obtain a free estimated value of a specific property.
  • Countrywide continues to innovate. The firm now provides easier access to its online financial services via a single sign-on facility. Its custom rate quote engine is also top-notch. The firm also offers qualified customers a “PaymentPower” program that permits them to skip a monthly payment if funds are needed for an expense elsewhere.
  • E-Loan pushes disclosures and full-compliance online. The firm is a pioneer in providing full disclosure and compliance, having done so since the Q3 2002 Scorecard. E-Loan continues to reinforce customer confidence by posting security and privacy policies throughout the site.
  • E-signatures debut (finally). Quicken Loans, which slipped one spot to sixth, finally launched its long-promised electronic signature service that enables clients to legally sign during the online application.
  • Homepage improvements continue apace industry-wide. E-Loan’s homepage, for instance, now features mortgage calculators, a help drop-down list and a new search engine that simplifies the task of locating site information. Wachovia, which has finally integrated its First Union offering with its existing mortgage site, now provides easy access to its mortgage applications, calculators and customer support contact information.

“Mortgage firms are making a strong effort to provide Web site users with a more direct means of obtaining loan information, rates and application access upfront on the homepage,” noted G�mez’s Patel. “Making customers venture into the bowels of the site for this type of information is counter-intuitive to many prospective customers and could have the unintended consequence of influencing them to click to a competitor’s online offering.”
To qualify for the Q2 2003 Internet Mortgage Scorecard, firms must offer online applications for a purchase mortgage; a loan status tracker; post current interest rates; and provide access to both telephone and e-mail customer service contact information and privacy statements. In addition, firms must process applications in-house through closing and be licensed to operate within states covering at least 50% of the U.S. population

As with other G�mez Scorecards, the Q2 2003 Internet Mortgage Scorecard no longer has a Responsiveness subcategory (telephone and e-mail responsiveness) within the Customer Confidence category. Firms that performed poorly on customer service testing in the previous Scorecard improved slightly in this ranking; firms that performed well dropped slightly.

About G�mez

G�mez serves companies that strategically depend on the effectiveness of their Internet channel to increase revenues and decrease expenses and provides the industry’s only comprehensive set of integrated solutions that help firms maximize the performance, functionality, and usability of their Internet channel. G�mez’s primary investors include: Dolphin Equity Partners of New York; Doughty Hanson Technology Ventures, the London-based venture capital fund of Doughty Hanson & Co; DB Capital Venture Partners, the venture capital arm of Deutsche Bank; and Harbinger/Aurora Funds of Research Triangle Park, NC.

G�mez Scorecards bi-annually measure the quality of e-commerce offerings, with a predominant focus on the Internet channel and a secondary focus on auxiliary channels and measures. Scorecards rank all firms in an industry that meet minimum standards of service (typically in terms of depth and breadth of product and national availability), and provide a snapshot of how industry players compare and contrast across user profiles and usage categories. G�mez, G�, G�mezPro, G�mez Scorecards, G�mez Performance Network and Internet Quality Measurement are trademarks and/or service marks of G�mez, Inc. All other trademarks are the property of their respective owners.