It’s important for any business to have a profile of the customers they serve. It’s no different in mortgage lending.
Yes, it’s easy to think that a mortgage lender’s customer is obviously someone who is financing a home, but there’s a little more to it. That’s a little like thinking that everyone coming to a wedding will dance to the same music.
First of all, a lender’s customers are split. There’s the consumer and then there’s the Realtor. Both require special services from a lender; both require attention to details and great customer service, but each of them dances to the beat of a different tune.
Let’s take a closer look at the consumer side. In knowing how to better the serve the consumer, lenders can better service the Realtors who sell them and the Builders who build to them.
There are two main home borrowing groups; the Baby Boomers and the Millennials. Today the Millennials represent the largest generation and the main area of potential business for lenders.
Who are Millennials and what do they want? Let’s take a closer look:
- Average age is 30 (maybe older than you thought)
- Median income at around $77,500 (maybe more than you thought)
- Average Home Price $187,400 (seems a little low)
- Almost half have an average student debt of $25,000 (probably lower than you thought).
So, this is the new generation of homebuyers. Maybe a little late to the dance but now they’re ready to boogey. Do you have the band, or digital sounds and the music to get them out on the dance floor?
The average home price evidences a need for affordable housing. Something Millennials share with Baby Boomers and low to moderate income home buyers. This puts a strong demand on a short supply. Another challenge that lenders need to overcome. I’ve covered this in prior blogs.
Most Millennials have the same dreams of homeownership as past generations? They are savvy buyers, knowing what they want, where they want it, and how long they plan to stay. They will shop, online and through the use of Realtors, for months looking for just the right home. When they find it they are quick to act, and want a lender that can do the same.
Do you know your customer? Are you prepared with the products and services to meet their needs?
- Education and online information and pre-qualifications
- On-line application, with digital loan processing
- Ease of communication and document gathering with e-verifications
- Personalized service
- Information on demand
Millennials might be the new generation but knowing and servicing your customers really hasn’t changed…once you know and understand what gets them moving. Be that lender that can best provide what they need and want, when they’re ready to dance.