As the founder of a Silicon Valley company specializing in serving the mortgage industry, I often find myself talking to veteran loan officers, real estate agents and home buyers who are a bit jaded when it comes to new technologies. That's because they've seen lots of solutions come and go over the years and a lot of the tools that were supposed to revolutionize the industry ended up fizzling out. So it's understandable that many of them are skeptical when it comes to how today's most popular social media sites, including Facebook and Twitter, are changing how homes are bought and sold.
But this time everyone should pay attention.
More than 150 million Americans have Facebook accounts. This is a staggering figure, but it's not just the sheer number of people who use social media sites that’s changing the game: it's how we are interacting with peer-based networks to make major purchasing decisions. Let's take a look at why social sites are on the brink of becoming major players in the mortgage and real estate industries.
1. Targeting. Unlike traditional advertising, which is often based on a scattergun approach, social media can place listings with incredible accuracy based on the users' physical location, interests, behaviors, and economic data. So instead of having to buy print and online ads, lenders and agents can go right to the source. Check out the rapidly diminishing size of real estate sections in any daily newspaper and you’ll see what I mean.
2. Relevance. Not only can social media sites put content in front of the right eyeballs, but they can also provide information that individual buyers and borrowers can use right away. Being able to put a picture of a house in front of someone who might be looking to buy is a major achievement; showing someone a home in his or her price range in the right community is a game changer.
3. Transactions. This is the newest addition to the social marketing mix in the real estate industry, and it's why lenders who ignore Facebook and Twitter do so at their own peril. Lenders are just beginning to figure out how to transform "browsers" into "buyers," and a key part of their strategy is making it possible for people to apply for loans directly from social sites without having to visit third-party websites.
4. Mobility. Social media sites may have started life on desktop computers, but that's a thing of the past. Millions of people regularly check Facebook on their tablets and post details about their lives in 140-character blasts from their mobile phones and they expect to be able to get relevant information whether they're at home, at work, or at lunch. There's never been a real estate platform that has allowed this level of penetration into people's lives.
Doing business on the Internet is all about seamless integration, ease of use, and security. By giving people the ability to safely apply for loans directly through Facebook pages, forward thinking lenders are able to reduce "drop-offs" and convert prospects into submitted applications as quickly as possible in the same place that they market to consumers without making them open new browser windows or visit other web pages.
One of our customers, Hometown Lenders, an Alabama-based mortgage lender, recently started offering direct-from-Facebook mortgage applications, and is already seeing great results. "We have a lot of followers on our Facebook pages, and we wanted to make it as easy as possible for them to apply for mortgages," says Matthew Hillis, CIO of Hometown Lenders. "We are already seeing people applying for and receiving loans directly through our Facebook page."
The integrated experience leverages Roostify's bank-level encryption of the entire mortgage application on its secure server. The tool's unique predictive experience allows consumers to complete full loan applications and provide documents within minutes, and it is common for mortgage applications to be processed in one or two days, rather than several weeks.
It would be a gross oversimplification to say that Facebook is going to single-handedly change the mortgage industry. But the early results of social media's impact on how lenders interact with customers can't be ignored. The bottom line is that today's buyers rely on social media, and mortgage lenders who ignore the trend are going to increasingly find themselves on the outside looking in.
Rajesh Bhat is the CEO of Roostify, a Bay Area technology company focused on simplifying the mortgage and real estate experience.