Information glut baffles borrowers, survey reveals

Real Estate Watch

March 30, 1997

A recent survey for the Mortgage Bankers Association showed that almost half of borrowers think the information they receive from lenders is too much to comprehend.

The survey, done by Yankelovich Partners during a three-week period that ended in mid-February, showed that 44 percent of borrowers felt that the settlement cost information was too much to understand all at once. Also, 31 percent of those surveyed said the biggest hurdle was understanding and completing the paperwork, while 17 percent had difficulty determining how much their loan would cost.

"MBA estimates some three million borrowers a year are confused by the home-lending process and would benefit from clearer, more concise information," said Ron J. McCord, president of the MBA.

Those who found the loan process confusing suggested some ways for lenders to improve:

Writing in common English.

Simplifying the process.

Having less paperwork.

Explaining all fees.

"Simplicity is what consumers who are extremely or very confused about the mortgage lending process want most," McCord said.

Despite the confusion, the study also found that consumers felt empowered by the information received during the mortgage process. More than 80 percent said the information they received improved the decisions they made.

As for the overall process, 60 percent said they were extremely or very satisfied with the experience.

Pub Date: 3/30/97

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