The rising interest rate environment of the past couple of months has brought home the point to mortgage originators that they need to be
But even before the long-awaited market shift, Mortgage Returns, a provider of customer relationship management technology, had made changes to its system to accommodate a purchase loan environment, said its CEO Jim Blatt.
Changes include giving loan officers the ability to communicate with clients through one-to-one marketing pieces that give specific details about their account, he said. The concept of one-to-one marketing is important as it will drive more business to the originator.
There is a focus on customer retention, with Blatt noting the system allows for benchmarking versus peers regarding the percentage of returning customers.
Included in the package is being able to offer clients a payment strategy report. It is all about positioning the originator as someone who is managing the homeowner’s loan, Blatt said.
He also spoke about the company’s TRUE CRM concept. The initials stand for Total database management, Relevant and automated marketing, Unbiased reporting, and Expertise and advice to improve results.
Now, built around that concept is an educational initiative to train lenders to increase the effectiveness of their marketing campaigns. Mortgage Returns will use such training tools as workshops, webinars, one-on-one sessions and newsletters.
“With the educational initiative, lenders are trained to use the data they already have to reach out to customers and prospects they assumed were unreachable or too expensive to contact, and cost-effectively manage newer, stronger relationships with new and repeat customers,” Blatt said.
Until recently lead management (sales automation) technology Velocify was known as Leads360. Kelly Booth, division director at the company, said the name change was to eliminate the confusion that the company was an aggregator of leads (which it is not).
So the shifting marketplace is a hot topic among its lender clients, she said. They are concerned about a significant decline in the refi business, especially because a majority of this business right now comes through the Home Affordable Refinance Program, and that could be burning out soon.
Still, not only do lenders need to get better at converting purchase leads, but they also need to get a better conversion rate from the remaining potential refinance business out there as well, Booth said. Those refi leads need to be worked to their full potential.
Velocify studies show that many lenders fail to contact a lead within 24 hours of an inquiry. She said the company has found that if someone responds in the first 60 seconds the conversion rate goes up by 391%.
Booth said the workflow in Velocify’s system will accommodate the differences between a potential purchase client and a potential refinance client.
A purchase transaction requires “more of a nurturing process” than a refi, she said, with the timeline to get to the closing table significantly longer and other players involved in the transaction.
Many lenders with a consumer direct channel use that to defend their servicing portfolio, so the people are typically geared to handle refis. Now these people have to be trained to handle purchases as well, she said.
Velocify’s system is enhancing its product to help originators keep those other parties in the purchase, like the real estate broker, in the loop.
There are events which can be set as triggers in the system, which will tell a user to go back and contract this existing client because they are a potential buyer of a new home or for refinancing.
“With the shift in the market, everybody needs to look wherever they can for their lead sources,” Booth said. And Velocify’s system is able to manage (and look at metrics about) that lead no matter where the lead comes from.
“So I think it is really key to be able to have insight and to be able to utilize the information you have about your current customer base and being able to identify where there is opportunity in it,” she declared.
ClosingCorp provides lenders and consumers data regarding closing costs, including taxes, on properties, said its vice president of lender services, Cathy Blaszyk. Being able to offer potential customers such data is one way to turn those leads into customers.
With the rising interest rates in the past couple of months, lenders and title companies have told ClosingCorp that volumes have declined by as much as 40% because refis have gone away.
That is painful for those loan officers who had been dependent on refis falling into their lap.
Today’s consumer, even if they are referred by a Realtor, still does much of his or her research about a lender online. Therefore, a loan officer needs to have “a really good online presence.” This includes having “a professionally done website.” And a major element needs to be testimonials from past clients and referral partners, Blaszyk said. Those testimonials “speak really loud to a consumer who is contemplating working with that loan officer.”
It is not just for consumers that the loan officer needs to have a professional looking site, she continued. Realtors do not want to hand out a business card from just any loan officer. They want to work with someone who has put the time, effort and money into their website.
Originators also need to have tools on their website (like the ones offered by ClosingCorp and other technology companies) to get the consumer to take action and become not only a client, but one who is pre-approved for a loan.
Realtors love loan officers who are able to offer these because they are now working with pre-approved buyers.
There are those loan officers who are experts on search engine optimization, while others hire consultants. Others do pay-per-click marketing.
Social media is also a way to harness past client recommendations.
Still, the “lowest-hanging fruit” in terms of leads for a mortgage originator is to cultivate the list of people they already know and have done business with, Blaszyk said. The loan officer can use life changing events such as marriage, birth or even divorce as triggers for mining new business.
“With all of the technology, it is still very much a relationship business. For long-term professional career originators, they have to [maintain] those relationships and stay in touch and not ignore their past clients,” she stated.
