When it comes to spending the marketing budget, the last thing mortgage lenders want to do is to waste that budget on ineffective campaigns. Modern lenders want confidence in the likelihood their prospective customers will buy a home, refinance their current home and/or apply for a home equity loan within the next 3-4 months or so.
Fortunately, there are three kinds of predictive analytics that focus on behavior prediction data, which can help lenders pinpoint a more accurate list of prospective clients, which in turn can effectively pre-qualify them, streamline marketing efforts and result in a higher return on marketing investment.
Three kinds of predictive analytics are the: Purchase Intel Score, the Equity Intel Score and the Refi Intel Score. Let's explore the insight offered by these scores and the opportunities they may present, consider the following:
Purchase Intel Score: Are They Likely To Buy?
When it comes to buying a new home, there are a couple of interesting market trends that are currently taking place that might complicate the process of home buying and selling. While many people could potentially sell their homes and purchase a new one, all while netting a profit from the sale, they may be reluctant to do so due to their current mortgage situation. Many existing homeowners are currently “rate-locked” at their current mortgage rate, and since mortgage rates are now on the rise, they may be hesitant to sell their homes. Another key trend that is currently underway, notes U.S. News and World Report, is that, despite many homeowners stating that they feel 2018 will be a better year to sell a home than 2017, a scarce 6 percent surveyed plan on actually putting their home on the market. As the article concludes, homeowners might want to re-think their plans to sell. Buyers are currently chomping at the bit to grab available properties and it’s possible that by selling a current property and moving to a different neighborhood, homeowners might be able to secure a lower property tax rate. The Purchase Intel Score gives lenders an assessment of how likely particular homeowners are to sell their current property and buy a new one within the next 3-4 months; the score also offers valuable insight that will help lenders navigate this often complicated market.
Equity Intel Score: Are They Likely To Borrow?
The Equity Intel Score is another key piece of marketing data intelligence that lenders can use to assess their audience. As its name implies, it predicts how likely a homeowner is to apply to borrow against the equity in their home. This particular audience can be especially challenging to reach, mainly because of the risks that are often associated with home equity loans. It is now easier than ever for homeowners to qualify for a home equity line of credit (HELOC), but tax laws have changed so it is wise for homeowners to be sure they have their tax ducks in a row. At the same time, according to CNBC, 1 in 4 homeowners with a mortgage is now “equity rich,” which means their outstanding balance is less than half of the home’s value. This means that despite any misgivings, this is an outstanding time for homeowners to take advantage of a HELOC and use the funds to pay down high-interest credit card debt or go on a well-deserved vacation. Being able to spot who is likely to seek a HELOC opens up marketing and new equity opportunities for lenders.
Refi Intel Score: Are They Likely To Refinance?
Some homeowners are satisfied with their current mortgage interest rate and have no intentions of refinancing. At the same time, there are still people out there who would be happy to refinance their homes to get a better rate. Weekly mortgage applications are currently stuck in a rut because of rising mortgage rates. They are currently holding steady at record highs and might climb a bit more. Depending on how long ago they got their mortgage, homeowners might be sitting pretty with a low rate. In order to be sure lenders are skipping the disinterested parties who have no intention to refinance and finding the hidden gems here and there who want to get a better rate, it is important to check out potential clients’ Refi Intel Score. The score will predict a homeowner’s likelihood to apply for an FHA, Cash-Out or Conventional Refinance in the next 3-4 months; lenders can then tailor their marketing to these specific homeowners.
Get Predictive Mortgage Intent Intelligence All in One Place
As a lender, you want to optimize every dollar from your marketing budget. The last thing you want to do is spend it ineffectively on marketing campaigns that fizzle out and go nowhere; instead, you should spend your marketing dollars where the data and predictive analytics clearly show it makes the most sense. Explore DataTree's homeowner marketing solutions for more information about how to access these metrics, as well as geographic locations and property details.