Slideshow 7 Ways to Reach New Borrower Segments

Published
  • June 29 2015, 3:02pm EDT

Mortgage originators willing to help consumers overcome traditional financing hurdles can add more emerging segments of home buyers as clients.

Add Alternative Credit to the Mix

Even skeptics at FICO think everyday bills like rent could be cautiously used as another way to assess credit. This could give originators access to millions of "credit invisibles."

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Hire the Next Generation

The average loan officer is part of Gen X, but it's the younger millennials who now dominate the broader workforce. Employing LOs from this generation may help the industry reach more customers within it.

Broaden Communication Channels

Each borrower may have a different way they communicate with their mortgage provider, so offer borrowers as many ways to connect as possible. In particular, keep up with innovations such as mobile devices and social media formats as they evolve.

Help Renters Become Owners

The homeownership rate is at a low not seen since 1993, largely because many renters find owning a home out of reach or simply undesirable. The industry can help change that in areas where ownership is cheaper by providing more rent-to-own programs with affordable financing.

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Make Loans to Foreign Nationals

Lending to underserved foreign national home buyers means originating a loan in the higher-liability category outside of qualified mortgage rules. But these borrowers are often willing to make higher down payments that mitigate this risk.

Bridge Groups' Ownership Gaps

While the U.S. population is becoming more diverse, some groups have lower homeownership rates than others. Lenders will make more loans if they can meet these groups' needs.

Serve Gulf War Veterans

Loans for those who served in the U.S. military and have returned are booming. The U.S. government has been heavily marketing its home loan benefits to current and former servicemembers, and it needs industry partners to originate the mortgages that it guarantees.