Building Customer Loyalty in Mortgage Lending: Insights from our Executive Breakfast

The Loyalty Challenge

We opened the conversation with a fundamental question: how do mortgage lenders build lasting customer relationships when mortgages, by nature, offer minimal ongoing engagement? Unlike current accounts or credit cards that customers interact with regularly, mortgages are set-and-forget products. Add to this the prevalence of broker-led origination, and many lenders never establish direct relationships with their borrowers at the outset.

The result? Borrowers remain highly price-sensitive with little emotional attachment to their lender. As one attendee candidly noted, "mortgage customers don't want to interact." This creates a significant hurdle for lenders seeking to differentiate beyond rate competition.

Persistent Pressures, New Dynamics

Attendees agreed that the sector's core challenges remain consistent: price competition, regulatory constraints, and process efficiency. Securing funding continues to pressure both large and small players. However, technology is fundamentally reshaping competitive dynamics.

Large banks leverage technology to drive down operating costs at scale, while smaller challengers use modern platforms to expand into new markets with agility. Both trends intensify competition in an already fragmented marketplace, making differentiation more critical than ever.

Technology as a Relationship Builder

We heard significant optimism about technology's potential to transform transactional mortgage relationships into enduring ones. Several powerful use cases emerged from the discussion:

• Operational Efficiency Through AI: Underwriters are seeing dramatic productivity gains, increasing case throughput from two or three cases daily to as many as 20, thanks to AI tools that handle first-pass assessments. AI-driven email triage is helping lenders respond faster to customer enquiries, providing key product details without manual intervention.

• Seamless Collaboration: Digital platforms enable multiple parties—lenders, brokers, solicitors, and customers—to share documents and information seamlessly, significantly reducing the time required to complete mortgages.

• Personalisation at Scale: Analytics can identify not just risky borrowers, but promising ones too. Lenders can proactively offer tailored finance to customers whose affordability is growing, turning renewal moments into opportunities for deeper engagement.

• Self-Service Empowerment: Self-service portals allow customers to view and accept renewal offers with a click, meeting the expectations of digital-native borrowers while freeing up staff for higher-value interactions.

The Tale of Two Lenders

Our conversation highlighted a clear divide in the market. Large incumbents benefit from cheaper capital, lower funding costs, and economies of scale. However, they face a significant constraint: legacy technology. As one executive from a major bank admitted, "Some of our systems are older than me." Decades of bespoke, interlocking systems make wholesale upgrades prohibitively expensive, while incremental changes are slow and risky.

Smaller challengers, meanwhile, can adopt modern cloud-native platforms without the burden of technical debt. Yet they must compete against the established reputations and deeper pockets of household names.

Starting Small, Thinking Big

We discussed a pragmatic approach to digital transformation throughout the discussion. "It's easy to end up trying to boil the ocean," nCino’s Regional Vice President Ben Ussher-Stanley warned. His advice: start with focused solutions that solve real problems and deliver immediate value, while laying the foundation for broader transformation.

Critically, technology shouldn't simply automate existing processes. Poor processes remain poor, even when digitised. Instead, lenders should use technology as an opportunity to fundamentally rethink how work gets done.

Beyond Customer Loyalty: Attracting Talent

Ben closed the breakfast with a compelling observation that extends beyond customer experience: employee loyalty matters too. "A younger generation coming into the workplace expect to work with the latest technology," he noted. "If they find that the technology is out of date, it may be hard to keep their loyalty."

For mortgage lenders, investing in modern systems isn't just about efficiency, compliance, or customer experience. It's about attracting and retaining the talent needed to compete in a market where the future belongs to those who adapt.

The Path Forward

Our breakfast discussion reinforced that building customer loyalty in mortgage lending requires moving beyond price competition to create genuine value through technology-enabled experiences. Whether through faster service, proactive personalisation, or seamless digital journeys, lenders who invest in modern platforms will be best positioned to earn both customer loyalty and competitive advantage.

Learn how nCino can help you create a best-in-class mortgage lending experience that enhances both customer loyalty and your competitive advantage.