The vast majority of mortgage transactions are still viewed today as single transactions – a loan closes and the lender and their customer move on. One of the main drivers behind this mentality is due to the fact that the majority of LOS platforms that lenders use are transaction-based. These systems don’t have a way to know that John Smith received a loan in 2022 when he bought a home, received another one when he bought a condo in 2023, and now that same John Smith wants to refinance the condo. Sounds archaic? It is.
What if lenders had the technology in place to approach mortgage lending as a relational process instead of a transactional one? What if they could easily access the data showing a borrower’s entire loan history – from their initial application and loans initiated but never completed, to all of the loans that have closed over the course of many years? By accessing meaningful data with the right technology and carefully mining portfolios, lenders can cultivate relationships with customers and assist them with mortgage transactions over time, thereby deepening bonds, capitalizing on opportunities, and improving profitability.
Refinances Should be Opportunities Won, not Lost
Consider this: The average homeowner in the U.S. gained about $28,000 in equity in the past year. That figure reflects price changes year over year through the first quarter of 2024, according to CoreLogic. Michigan homeowners on average gained $20,000 in equity. California saw the largest average equity gain in the country at $64,000. High home prices in many markets with high demand drove up these averages.1
At Mortgage365, we’re focused on delivering technology that utilizes a relational data model to help lenders more effectively mine for refinancing opportunities and build relationships for life with borrowers. For example, with our platform, a borrower – an individual – only shows up in a lender’s database once. And with that one-time view, you can see all of the loans that you've either completed for that person or started but didn't close. Our technology’s integrations enable the ability to track every interaction that a lender has with an individual, regardless of the loan. So, every email exchange and text conversation that a lender has had with a borrower for as long as they have been a customer can be accessed.
With regard to refinancing specifically, when you establish an individual contact, you can see every loan that has been written for that person. You can see when a mortgage loan was provided to a borrower, what their rate was, and can compare it to current rates to determine whether it may be a good time to present a refinancing scenario to that established customer.
Another tool our platform provides is scenario building. This solution enables lenders to manage a single view of what a person's current loan is, and then outline various options they want the borrower to consider.
Mining the Data
Lenders can use Mortgage365’s technology for data queries too. For example, you can ask it to show you all loans that closed in the last two years at a rate of 7% or higher.
One of our clients has a huge servicing portfolio that is a significant part of their business. They have their own data mining team that identifies and reviews loan opportunities, such as loans in their servicing portfolio with a high rate. They then develop beneficial offers to market to that segment of the portfolio – perhaps a lower interest rate or a cash-out refinance. The effort is completely portfolio retention focused.
However, big servicing lenders have one limitation that is inherent to the Mortgage Servicing Providers (MSPs) they use. These tech companies typically do not make data available whenever there is a change to the portfolio – such as when a payment is made, when a loan is fully paid back, current escrow balance, etc.
To combat this obstacle, one of our clients uploads its servicing portfolio file into Mortgage365 every day and builds all the borrower information into it with the current balance, interest rate, etc. Mortgage365, in turn, can display the servicing fields that are important to this lender. Then the client performs a second upload with the offers that can be extended so they can begin marketing them to each borrower. Our client can even send an invitation using its POS to have the borrower confirm the information that is on file and once it is submitted, they are off and running to complete the refinance. The platform even has a presentation engine that is fully branded and customizable which shows the borrower a side-by-side view of the loan options they have, what payments would be, etc.
Using Mortgage365 for Portfolio Retention
A primary need of portfolio retention teams is getting the fastest possible access to a borrower’s current rate and term and the loan solutions the lender can offer to try to keep them as a customer. The goal is to show borrowers the options that truly benefit them. Our objective is to keep our clients engaged with Mortgage365 so they can do most of their strategic retention work within our platform, such as pricing calculations, etc.
Once the lender has outlined an offer for a customer and sent it to them in some way – that data becomes readily available to its origination team. That way, when a borrower responds, the lender’s team has all the information they need about that person. This eliminates repeated requests for the same information from the customer and gives the lender the ability to jump right into how it can best help the borrower.
With Mortgage365, a lender can also segment borrower data into groups, i.e., the existing customers that have been extended offers that will be continuously nurtured, etc.
Customized to Meet Your Lead Management Needs
In addition to its scenario-building and data mining capabilities, Mortgage365’s lead management workflow is completely customizable and open-ended in terms of how it can be configured, allowing lenders to create their own sales playbook and designate instructions as to what to do once a loan meets certain criteria. The lender can review the servicing data, determine a valid offer, and assign the lead to a LO or team. Specific tasks can also be assigned, such as requiring a loan officer to conduct some sort of outreach – immediately call, four hours later email, call the next day and leave a voicemail, etc. Then the LO can make a note on the file to detail how each communication went.
For example, if the loan status changes but the prospect’s application is in process – then Mortgage365 can move that prospect to a new lead management workflow – “Application started but not submitted” – which will trigger another set of outreach tactics.
In this competitive mortgage market, lenders must be smart about not just securing new business but retaining it as well. This is best accomplished by viewing mortgage lending less as a transaction and more like an ongoing relationship that can be mined and nurtured over time. At Mortgage365, our focus is on providing the best technology to enable lenders to easily use the data at their disposal and develop strategies that encourage more refinances, and ultimately more business, over the life of a customer relationship.
For more information about Mortgage365 and what our relation-based platform can do to help you close more loans, visit our website or request a demo.
