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New Study Shows Technology Could be to Blame for Missed or Late Mortgage Payments

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A study released on February 7, 2018, revealed that bad billing and payment experiences accounted for 34% of late mortgage payments. This is due largely because most mortgage companies don’t allow borrowers to pay using a debit card, which is the preferred method of payment according to those surveyed.

The research was published by ACI Worldwide, an organization that provides real-time, any-to-any electronic payments solutions to financial institutions, intermediaries, merchants and billers. According to their website, “ACI Worldwide, the Universal Payments (UP) company, powers electronic payments for more than 5,100 organizations around the world. More than 1,000 of the largest financial institutions and intermediaries as well as thousands of global merchants rely on ACI to execute $14 trillion each day in payments and securities.”

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RewardExpert recently spoke with Steve Kramer, VP of ACI Worldwide, about their recently published study and what consumers can do to avoid late payments on their mortgage accounts.

Built on a Growing Need

ACI Worldwide was founded in 1975 in Omaha, Nebraska. Originally known as Applied Communications Inc, the company was created to develop software that banks used to manage ATM machines, amongst other things, and eventually grew to the organization that it is today. Now employing more than 4,500 employees in 31 countries around the globe, the organization works with 18 of the top 20 banks worldwide and has more than 4,000 organizations that utilize their electronic bill payment solutions.

What is Important to the Consumers

When asked what consumers look at most when deciding on a mortgage lender, Kramer explained that “There are many factors that lead borrowers to choose one lender over another, but based on consumer research, payment choice and convenience are very important. If a lender does not offer the customer’s desired payment experience, they should provide feedback to the potential mortgage servicer.”

In fact, beyond the interest rates themselves, 57% of the survey respondents consider if the mortgage company offers convenient ways to pay before making their decision to bank with them. The study further reveals that convenience also reduces the number of call center calls by 83% and the frequency of complaints made on Social Media channels by 49% overall.

For many consumers who are already locked into a mortgage, the frustration of paying your bill on time only to have it reflected on your statement as late – or worse, missing altogether – has been mounting. “Thanks to technology, borrowers have many tools and resources to help manage large, recurring payments. Setting up recurring payments, whether through the consumer’s bank or lender’s website, can help mitigate the risk of late payments,” Kramer said.

“If there’s a history of on-time payment, the lender may waive late fees and penalties. Alerts (via email or text) can help keep borrowers informed of their payment status. In a situation where the payment is not present in the account history, a phone call to the lender is in order.” image
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Why Banks are so Reluctant

Currently, there are only 4 out of the 20 top mortgage servicers today who accept convenient card payments today. So why are banks so slow to jump on board with what the consumers have been asking for?

“The cost of debit card acceptance vs. how it can improve back office processes, decrease delinquent payments and deepen customer relationships is one driver,” offered Kramer. “Legacy infrastructure designed to handle paper and electronic check payments and not modern payment types like debit is another reason.”

“Consumer research shows that the business case for debit acceptance is stronger than ever, with Millennials making $100 billion in mortgage payments, with 21% made with a debit card. Removing friction from the payment process and offering all the ways consumers want to pay will reduce call center volume, collections costs and exceptions processing.”

On the Horizon

While it may seem like your bank is living in the stone age when it comes to making it convenient to pay your bills, there is good news about the future. “The Internet of Things (IoT) has opened new ways for businesses to connect with consumers,” Kramer explained. “Be on the lookout for innovators challenging the status quo so that consumers can pay when, where and how they want to pay.”

For more information about this study or to learn more about ACI Worldwide, visit their website at

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