Survey: New HELs Jump, HELOCs Drop

New home equity loan account bookings reported in the 20th annual Consumer Bankers Association Home Equity Lending Study jumped 54% in 2006, while new account bookings for home equity lines of credit dropped 24%, according to BenchMark Consulting International, Atlanta.BenchMark said new home equity account bookings fell nearly 5% overall. The study also found that response rates to promotions for home equity loans and HELOCs declined 27% from rates recorded in 2005. "We expect response to marketing for HELOCs and loans to continue to diminish as interest rates rise, and forward-thinking institutions are already pursuing new revenue streams to compensate for this downward cycle," said Brian King, manager of BenchMark's consumer lending practice. "The most value to be attained depends on the institution -- some gain traction quickly with new product offerings, while others see significant returns through streamlined operations." The study includes findings on pricing, marketing, sourcing channels, and delinquencies/chargeoffs, among other factors. Conducted by the CBA in conjunction with BenchMark, the report included 46 participating home equity lenders. BenchMark can be found online at http://www.benchmarkinternational.com.