Mortgage

How lenders are utilizing training to achieve tomorrow’s debtors

While housing agencies and community organizations have mandatory counseling and education coursework used to qualify for specific grants or down-payment assistance, many informational, typically free, educational programs presented by lenders or realtors are open to a wide set of consumers at various stages of mortgage preparedness. And many people are using them to take steps toward homeownership. 

Although the seminars and webinars are not new in mortgage marketing strategy, they are a form of outreach that appears far from being tapped to their potential. Industry professionals who don’t capitalize on the benefits of these tools could miss out on the pipeline of business it brings down the road. 

Frequently, consumers seek out the presentations because they are apprehensive about directly approaching a bank or lending office with questions.

Sarah Prater, a loan officer at Gold Financial Services in Stillwater, Oklahoma, who has been offering her “Market Shmarket” course since 2020, sees “a huge sense of resistance or fear” from those new to the home processing buying or who haven’t made a purchase in a long time. “Some of that is driven by, I think, all of the overabundance of information,” she said.

“One of the things that I’ve found that’s very common is that people are afraid to ask questions because they feel it’s a stupid question. They have this thought like when you go to a job interview — it’s one shot, you have to make your best impression. Anything you say can be used against you,” she said. 

Carolyn Morganbesser, assistant vice president of mortgage originations at Affinity Federal Credit Union, headquartered in Basking Ridge, New Jersey, has heard her share of unexpected questions during her presentations. Among Affinity’s educational offerings are a four-part home buying webinar series Morganbesser leads covering topics from credit to closing costs. 

“The last one that we did, I had a senior,” she said. “The question was can senior citizens get 30-year mortgages, and of course, they can.” 

The range of questions posed highlights the knowledge gap among many potential buyers nervous about mortgages, an issue seminars and video presentations end up addressing because the information is difficult to find elsewhere.      

“As an industry, we are not doing a great job answering those questions,” said Ginger Bell, CEO of edumarketing.com, a Beaverton, Oregon-based company that produces and edits branded online video explainers and podcasts for mortgage and real estate businesses. Bell’s background working in training operations for several home lenders helped lead her to found edumarketing.com in 2019.

“Consumers do want to learn, so providing them with the information that they’re looking for is important,” Bell said. “And it doesn’t have to just be the soundbites. Consumers are looking for this information, and they are digesting it.”

The COVID-19 pandemic accelerated growth of video education tools and drove home the need for more professionally produced work, Bell said. It also coincided with the explosive growth of TikTok, the video app highly popular with millennials and Gen Z.

The increased popularity of TikTok drove Linthicum, Maryland’s NFM Lending to create an influencer division specifically developed to appeal to younger consumers and teach them about home buying. Adding loan officer Scott Betley, also known as That Mortgage Guy on TikTok, to its team last year, NFM now has 10 influencers, who generate between 2,000 to 4,000 exclusive leads a month from their videos, according to Greg Sher, NFM’s chief business development officer.   

Like seminars, the educational videos created by NFM influencers are aimed at finding the home buyer early and helping develop brand trust, while also serving as a means to gather a consumer’s data when they sign up to follow a creator. NFM found 97.5% want to purchase a home as opposed to renting.

“Eighty-seven percent of them don’t have a real estate agent yet. That’s how early we’re getting to them in the process,” Sher said.

But an additional benefit of video is the capability to quickly act on information provided by followers and design targeted campaigns to “meet them where they’re at,” Sher said.

“If it’s six months out or greater, we take them down on a longer journey. If it’s anything before six months, we start to get in front of them and educate them and tell them what they need to do to get ready.”

Videos on YouTube and social media also have the power of shares and recirculation to quickly expand a client base beyond what may have first been imagined as well, Bell said.

A newer client of hers, who only became licensed in October 2021, found himself receiving queries from several individuals he had never interacted with nor targeted. Eventually, he learned they had found him from his videos forwarded by his network.

“He’s 30-something and sharing it out with his friends, and his friends are sharing it with their parents, and the parents are in turn, calling him,” Bell said. 

Despite video education’s potential with the growth of YouTube and TikTok, its current use among home lenders is miniscule  — “maybe 1%” of the industry, Bell estimates. 

Taking the curious consumer from the point of a webinar or video viewing to homeownership is often a long-term project, requiring ongoing outreach. 

When NFM determines that one of its influencers’ followers won’t qualify for a mortgage right away, it provides them with another video training tool, which adds incentives to take a loan with them when they complete the course.

“If the credit score is below 570, we put them into an educational program that we built through a mobile app called Home Stretch,” Sher said. The app includes a library of more than 80 videos shot, produced and edited by NFM. 

“When they’re done watching all the videos, they graduate and we give them a $500 lender credit toward a purchase,” Sher said.

While informational classes and videos are most commonly focused on educating the first-time buyer, they could be the first seeds planted that lead companies to be top of mind for future return business. Some companies also cover other real estate topics on consumers’ minds, such as home selling, a subject Morganbesser said Affinity will feature in seminars to its nationwide membership base in 2023.

Edumarketing.com has helped design videos discussing more specialized subjects. 

“We had a video script that we did a few months back that was on what to do about your mortgage when you’re going through a divorce that our clients had huge responses to, because those are the questions that people have,” Bell said.

Home buyer training helps set the stage to build financial wellness, resulting in the type of satisfied potential repeat customers that businesses value.  

“The main question I get asked the most is ‘Is it too early to attend these webinars?'” Morganbesser said. “To which my answer is always, ‘It’s never too early.’ It’s never too early because you’re learning. You’re preparing. You’re getting your ducks in a row.”

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