Data from Mortgage Bankers Association indicates that mortgage applications decreased 5.1 percent in a week-over-week comparison from the week ending April 7th to the week prior. Rising interest rates, coupled with home-price growth and low inventory is slowing mortgage applications. The refinance demand is showing similar trends, with application volume down more than 30 percent over the past 10 weeks, according to data released on April 7.
Inman also reports that rising interest rates are simmering housing market activity. While interest rates continue to be at historic lows, with a 30-year fixed mortgage at a 2.92% interest rate on April 9, these will continue to move, bouncing off all-time lows.
Fluctuating interest rates and reductions in inventory can create significant changes in how quickly buyers are looking to move in this market, not to mention their expectations for the overall experience. This is where mortgage sales teams should look toward systems and technology that help them make the most of their ongoing sales activity.
Embracing Machine Learning Applications
As it currently stands, there are many applications of data science and automation tools in the mortgage industry. However, one area of overlooked innovation has been applying machine learning to improve sales processes including how leads are handled. Traditional workflows have been “good enough” for a booming market.
Opportunity exists to make machine learning technology an integral and differentiating element of sales strategy. As we recently shared, there are easy ways to leverage the technology to create measurable improvements in a way that complements team expertise. A strategic approach to optimizing lead management could deliver a competitive edge as the market shifts.
Focusing Sales Team Efforts with Objective Measures
|Connecting with a borrower most likely to convert is about objectively measuring probability. Loan officers and sales leaders often rely on gut instinct and industry experience to drive lead handling decisions. Sales teams can now leverage dynamic lead conversion data and machine learning technology to calculate the objective probability of conversion and prioritize leads accordingly. Using intelligent technology that connects loan officers with the buyers most likely to convert helps sales teams prioritize efforts and drives huge productivity gains. |
In parallel, loan officers need actionable data to suggest how and when they should resurface abandoned leads. As interest rates fluctuate, and the number of buyers versus available inventory shifts, mortgage sales teams can use real-time lead data to suggest which prospects to re-engage at a specific moment in time. Relying on intelligent technology that leverages historical and real-time data can provide a more accurate picture to guide re-engagement.
Choosing the Best Loan Officer for the Job
The customer’s expectation of closing a loan, in comparison to the reality can cause a detrimental impact on the customer experience which may result in them seeking out a competitor for a mortgage. Getting smarter about how to approach potential borrowers in this market will help mortgage sales teams maximize their team’s time and resources while improving the customer experience.
Each mortgage shopper is likely to have a type of salesperson they will be most likely to place their trust in, one who meets their preferred style. By identifying this match up front and managing the lead assignment to pair the right prospective borrower with the right loan officer, lenders can set their prospects and loan officers up for a successful transaction. Machine learning is perfectly suited to find this match.
Interest rates are still historically low, but fluctuating rates and a competitive buyer’s market has created a unique dynamic across the consumer direct mortgage market. Traditional borrowing patterns of the past won’t be enough to form lead optimization strategies. Access to real-time, dynamic lead data helps mortgage sales teams get the insights needed to get one-step ahead of eager borrowers and better compete in a changing market.
Reach out to ProPair to learn more about how to drive better performance for your consumer direct mortgage team.