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Turning Data Into Meaningful Connections

This piece originally appeared in the January 2022 edition of MReport magazine.

Mortgage brokers compete with retail loan officers for borrowers’ business. Retail loan officers, though, are increasingly supported by their employer with technology that utilizes data to identify loan opportunities and to engage past borrowers.

According to a 2020 research collaboration between Freddie Mac and Forbes Insights, 91% of lending professionals agree that technology played a key role in enabling their firms to meet the needs of customers and partners during the pandemic.

Now, wholesale lenders—especially those already using technology to fuel personalized communications with retail channel borrowers—can access a significant new opportunity: winning increased loan volume and loyalty by providing brokers the benefit of technology made to create customers for life.

Here are three ways wholesalers can improve the borrow/ broker relationship and strengthen their business for a far more competitive purchase market.

Borrower Retention: A Broker Pain Point Solved With Technology
Technology that drives borrower retention is a game-changer for broker-wholesaler partnerships.

Brokers, like retail loan officers, need to be free to serve borrowers in their pipeline. They benefit—usually experiencing a 2x increase in return business—when their wholesale partner engages past borrowers on their behalf.

With the right technology, wholesalers can identify, segment, and engage borrowers who might need a cash-out refinance or to purchase a new home. Lenders report that personalization increases email open rates by 3x compared to peers, lead-to-conversion rates rise by 50%, and borrower retention balloons by 50%.

As brokers decide which wholesalers will be their partner of choice, wholesalers that use technology to provide personalized engagement to past borrowers can expect origination growth.

In fact, they have double the opportunity to thrive. When retention grows by 50% for brokers, the wholesaler sees both expanded volume through existing partners, and they grow new partners because they’re offering brokers the equivalent of a borrower-for-life guarantee.

Wholesale Change Through Technology
New tech has overcome what has been an intractable challenge for wholesale mortgage. Brokers are independent businesses from a wholesaler; they have their own—albeit limited—technology. It has been far easier for the mortgage industry to provide customer-for-life technology to loan officers in the retail channel. How can wholesale provide that same customer-for-life tech to their brokers?

With the right tech partner, wholesalers can now shoulder the marketing and communications work to engage brokers’ borrowers. Broker messages appear with their branding in borrowers’ inboxes—without the broker lifting a finger. For massive growth in retention, consider the long list of benefits this provides the broker:

  • No additional work
  • No tech cost
  • No marketing cost
  • No new staff cost
  • Warm leads
  • A growing business

Research shows 69% of consumers who receive advice from their lender act on it. With the help of their wholesale partner, brokers can join that circle of trust and play the role of a financial partner who identifies opportunities personalized to a consumer’s unique situation.

How Wholesalers Personalize Borrower Touchpoints
By implementing the technology retail lenders often employ, wholesale lenders can provide borrowers a full library of personalized messages on behalf of the broker. An example is high home values in 2021.

Consumers now have an opportunity through cash-out refinances to consolidate debt, reduce the cost of student debt, or renovate their kitchen. Few brokers have the operational budget or infrastructure to customize and manage customer-for-life marketing. Similarly, wholesale lenders have limited capacity to segment borrowers, customize marketing messages, build out the logic for automated journeys, and tie engagement to industry triggers based on borrower data. Fortunately, there are technology companies today that handle most of these steps for wholesalers—setting up a new platform to handle all that marketing would have fallen to the wholesale lender, even five years ago.

Personalization Key to Borrower Loyalty
Data is necessary to personalizing borrower experiences, and today’s borrowers want a humanized experience with digital convenience. Wholesale lenders need to support their brokers by investing in technologies that cultivate lifelong relationships with borrowers. The result will be well-served consumers who return to their broker time and time again throughout their lifetime. For wholesalers, that borrower loyalty offers them a serious opportunity to snowball loyalty—from consumers and from brokers—to a greater and greater share of annual originations.

About Author: Joe Welu

Joe Welu is the Founder and CEO of Total Expert, the creator of the only Marketing Operating System built to meet the unique needs of the mortgage industry. Welu founded Total Expert in 2012 to empower lenders to take their marketing and sales efforts to the next level.
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