While the clock is ticking on the refi market, smart mortgage pros are preparing now to target the next generation of buyers. Kelly Booth of El Segundo, California-based Velocify provides a four-step plan to successfully target younger borrowers.
By Kelly Booth, Mortgage Vertical Director at Velocify
All signs point to an awesome spring for first-time homebuyers. Rates are low, employment is improving and consumer confidence is growing. While the clock is ticking on the refi market, smart loan officers are preparing now to target the next generation of buyers.
The question is, what are you doing to attract younger borrowers, and is it enough? Here are four steps to successfully targeting this growing market.
Step One: Be Where the Buyers Are
According to a recent Fannie Mae study, more than half of all borrowers are searching for loan information online. But you can bet the number is closer to 100 percent for the Millennial generation—that is, Americans under 35 years old who have literally grown up with the Internet. You should anticipate the first contact you make with a first-time homebuyer will happen online.
That means you need to have both a strategy and the tools to respond to borrowers fast. Just know that after a borrower submits a request for loan information through Zillow or LendingTree, a lender could be on the phone with that borrower within one minute, at very little cost. Why shouldn't it be you?
Step Two: Mix It Up
The second step is to incorporate a mix of communication channels when working with first-time buyers. That means phone, email or text message, and it means your communication platform must accommodate multiple channels.
But a word of caution—don't assume that young buyers prefer to be contacted by text message while you are still building the relationship. They reserve texting for their closest, most trusted relationships. Wait until they say it’s OK.
Step Three: Build Real Estate Partnerships Through Value
While most first-time homebuyers start their search for homes and mortgages online, the first person they actually speak to is a real estate agent. So real estate partnerships are still valuable. The trick is to outperform competitors when it comes to providing value.
One way to set yourself apart is by outhustling other lenders on the communications front. The biggest consumer complaint about the home buying process is that nobody gets back to them quickly enough. If you can leverage automation to stay in touch with all parties and deliver real-time updates, you’ll win the hearts and minds of agents, and they’ll learn to count on you for every deal.
Step Four: Be A Trusted Advisor—Always
Your job as a mortgage professional is to offer sound counsel and educate borrowers so they can make good decisions. That’s more important than ever as the market switches from refis to purchase loans. However, too many loan officers abandon the advisor role once a borrower's motivation level drops. Don’t do that.
Leveraging technology can help automate some of this nurturing process—not through spam, but by informing would-be borrowers of new loan programs and educating them on how to save for a down payment. If you become someone’s trusted advisor, chances are they’ll eventually trust you with their loan.
If you follow the above steps, you could have an extremely busy spring working with first-time buyers—who will eventually become move-up buyers, and likely to use you again.
Kelly Booth is the mortgage vertical director for Velocify, a market leader in cloud-based intelligent sales automation solutions. She can be reached at [email protected].
