Low Cost Means Better Service?

NEW YORK -- USAA Federal Savings Bank is not the biggest or best known mortgage servicer in the country, but other lenders might be able to learn something from USAA about how to treat customers right.

And that doesn't mean showering attention on them, according to a study by J.D. Power and Associates.

A recent customer survey by the firm gives USAA, a provider of insurance and financial services to members of the military, the industry's highest customer satisfaction ratings for mortgage servicing. The San Antonio-based financial provider has a widely dispersed client base and provides most of its services electronically.

Rockwell Clancy, executive director of the banking and mortgage practice at J.D. Power, told MSN that USAA benefits from having only one banking branch, so it does business remotely via telephone, website and mail. The company also has a strong service culture and a strong affinity with its military customer base.

Because the bank operates remotely, it is forced to make sure processes work right because it doesn't have the opportunity to "muddle through" problems with customers at branch offices. Other lenders that scored high on the J.D. Powers customer satisfaction survey were BB&T and Citizens Bank.

Not surprisingly, customers whose servicing rights were transferred after origination gave their loan servicer lower customer ...