IT News Online – Sales Boomerang Releases Q4 2021 Mortgage Market Opportunities Report

Send2Press Newswire
2022-01-31

WASHINGTON, DC, Jan. 31, 2022 (SEND2PRESS NEWSWIRE) — Sales Boomerang, the mortgage industry’s top-rated automated borrower intelligence and retention system, today released its latest mortgage market opportunity report. The fourth quarter 2021 report identified growing opportunities for mortgage lenders to help borrowers build workable home equity, lending credence to analysts’ expectations for increased mortgage activity linked to real estate capital in 2022.

Methodology

The Mortgage Market Opportunities report leverages data from the Sales Boomerang system to identify relevant market opportunities for borrowers and lenders today. To generate the report, Sales Boomerang reviewed data from more than 160 residential mortgage lenders who use its borrower intelligence and retention tools to monitor millions of customer and prospect records. Sales Boomerang then calculated and compared the overall frequency with which these contact records triggered loan opportunity, normative scenario, and risk and retention alerts during the third and fourth quarters of 2021.

Key Findings*

Sales Boomerang’s Loan Opportunity Alerts identify contacts in a lender’s database who are actively seeking a mortgage or who might qualify for a new mortgage. Across the sample as a whole, the frequency of each type of alert in Q4 2021 was as follows:

  • Mortgage Application Alert: 4.42% of contacts monitored (down 16.13% from Q3)
    A customer or prospect has purchased from a competitor in the last 24 hours.
  • EPO alert: 1.84% of contacts monitored (down 17.49% from Q3)
    A customer or prospect whose loan was closed ≤ 6 months ago made purchases from a competitor in the last 24 hours.
  • Credit improvement alert: 1.14% of contacts monitored (down 13.64% from Q3)
    A client or prospect has improved their FICO score.
  • New announcement alert: 0.64% of contacts monitored (down 38.46% from Q3)
    A client or prospect has put their home up for sale.
  • Equity Alert: 8.61% of contacts monitored (up 7.36% from Q3)
    The net value of a customer’s or prospect’s property has increased.
  • Rate alert: 5.07% of contacts monitored (down 27.16% from Q3)
    The interest rate on a client’s or prospect’s existing mortgage is significantly higher than prevailing rates.

Sales Boomerang’s prescriptive scenario alerts not only analyze whether a consumer could qualify for a given type of loan, but also whether the consumer is qualified to apply for financing. This added layer of intelligence makes Prescriptive Scenario Alerts one of the highest conversion rates available to mortgage lenders today. The frequency of each alert during the fourth quarter of 2021 was as follows:

  • Cash-Out Alert: 5.08% of contacts followed (+17.87% compared to Q3)
    A borrower is credit-qualified and has accumulated enough equity to draw on money from their home.
  • Alert rate and duration: 10.05% of contacts monitored (up 160.36% from Q3)
    A borrower is credit qualified and can take advantage of today’s interest rates for a refinance.
  • Debt alert: 1.33% of contacts followed (-23.12% compared to Q3)
    A borrower qualifies for credit and can benefit from paying off other debts with the equity in their home.
  • MI FHA deletion alert: 14.01% of monitored contacts (up 92.71% from Q3)
    An FHA borrower has exceeded 20% equity and can remove mortgage insurance (MI).

2021 Fourth Quarter Mortgage Market Opportunities Report - 02

For a subset of lenders who maintain management portfolios, the frequency of risk and retention alerts was as follows:

  • Risk & Retention Alert: 31.18% of contacts monitored (down 13.82% from Q3)
    A client engages in one or more of 15 credit activities that could jeopardize their managed loan

2021 Fourth Quarter Mortgage Market Opportunities Report - 03


To analyse*

  • When a borrower makes less than 20% down on an FHA-insured loan, they are required to pay mortgage insurance (MI) premiums in addition to their monthly principal and interest payments. FHA borrowers with MI may be unaware that they have the option to withdraw their MI once they reach 20% equity. With an increase of almost 93% quarter over quarter in FHA Removal of IM alerts, lenders have the ability to provide immediate monthly savings to borrowers.
  • From Sales Boomerang’s Collection alerts only trigger for qualified credit contacts, continued gains in this alert category show that borrowers are increasing their credit scores alongside their equity. Lenders should prepare for continued cash-out refinancing and HELOC activity in the months ahead.
  • Attentive observers will notice that the Rate and Rate and duration alerts moved in opposite directions from Q3 to Q4. After a year of rising interest rates, fewer consumers are able to qualify for refinancing based solely on the difference between their current interest rate and prevailing market rates. Rate But a higher frequency of Rate and duration The alerts indicate that while the overall refinance market is down, there is a growing subset of consumers who have the equity in their home and the credit profiles necessary to qualify for a refinance.
  • Mortgage application and EPO alerts decreased for a third consecutive quarter, and New listings are down for a second consecutive quarter. With fewer consumers actively entering the market for mortgage products, lenders will need to be proactive in providing financially rewarding opportunities to potential customers.
  • 14% decline in Q4 Risk retention alerts was the category’s first significant drop in 2021. Still, with nearly one in three borrowers still exhibiting risky credit behavior, mortgage managers should closely monitor their portfolios for default risk.

“Borrowers aren’t always aware of the multitude of ways they can leverage the equity in their property, but it’s becoming increasingly clear that equity creates some of the best financial opportunities for borrowers and lenders. today. It’s up to us to help mortgage advisors bring these opportunities to their clients,” said Alex Kutsishin, CEO of Sales Boomerang. “Experts may have predicted that 2022 would be a year to focus on purchase transactions, but our data shows lenders would be well served to shed some light on home equity lending.”

* Key findings and analysis provided for informational purposes only. The data represented in the Mortgage Market Opportunities report is historical. Past performance is not a reliable indicator of future results. Sales Boomerang disclaims any responsibility for readers’ use of any key findings or analyzes included in this report.

About Sales Boomerang:

Sales Boomerang transformed the relationship between mortgage lenders and borrowers with the introduction of the first automated borrower information system in 2017. The company’s smart alerts notify lenders the moment a former client or prospect is ready and qualified for a loan. More than 150 lenders, including brokers, independent mortgage companies, credit unions and banks, trust Sales Boomerang, the mortgage industry’s #1 borrower engagement tool, to help build lasting relationships with borrowers that maximize customer lifetime value. To date, Sales Boomerang alerts have enabled lenders to close more than $150 billion in incremental loan volume that would otherwise have been overlooked and achieve customer retention rates that exceed industry standards. 3 to 5 times on average. To learn more about Sales Boomerang and its No Borrower Left Behind™ philosophy, visit https://www.salesboomerang.com.

@SalesBoomerang

News Source: Sales Boomerang

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David A. Albanese