PERSON OF THE WEEK: Mortgage lenders are struggling in this challenging market. As a result, many are turning their focus on their existing customers and looking for ways to expand and customize their offerings. But how can mortgage lenders looking to tailor their offerings gain a more comprehensive view of their customers’ needs? How can they personalize their offerings so as to meet the needs each borrower?
To gain a better understanding of what products existing customers may want, lenders should look at both credit data and property data, says Bindiya Jain, senior director of product innovation, North America, for Experian Housing, in a recent interview with MortgageOrb.
Q: Given the current market challenges, what are your clients currently focused on?
Jain: Many mortgage lenders are struggling to grow their businesses, as a result, they are keenly focused on their existing portfolios, both from a retention and risk management perspective. They’re looking for ways to identify new opportunities and add value to retain and expand their relationships with existing customers. They’re increasingly leaning into data and analytics to inform their strategic direction on portfolio management. This focus is enabling them to identify new ways to tailor their interactions and provide personalized offerings to consumers. In doing so, they’re expanding their businesses while mitigating risk, which is a win, win.
Q: What data sets should lenders be leveraging to stay ahead in our current environment to successfully maintain relationships with existing customers?
Jain: There is no question that lenders can extrapolate meaningful insights from consumers’ credit histories. At the same time, a complete view of property data is essential for risk management. However, looking at credit data and property data in isolation is leaving many lenders falling short. In today’s environment, lenders need a unified 360° view to make holistic risk assessments, identify new opportunities for consumers and drive growth. With the power of this combined view of credit and property data, lenders can assess a borrower’s financial health from multiple perspectives across the entire lifecycle to create new opportunities for consumers and their businesses.
Q: How can lenders leverage credit and property data to create new opportunities for borrowers and to expand relationships with existing customers?
Jain: A combined view of credit and property can facilitate more meaningful and personalized interactions with customers and enhance the overall customer relationship. For example, access to both credit and property data allows lenders to offer more customized loan products based on individual borrower profiles. They can also use this information to understand borrowers’ financial goals and constraints and tailor their offerings from there. For instance, a lender could identify borrowers who have equity built up in their home but also have a large amount of revolving debt. These consumers may make for good cash-out refinance candidates specifically with messaging for debt consolidation. Not only that, lenders that leverage both credit and property data can also offer more competitive and attractive loan packages. This may lead to increased market share and customer loyalty as the value of a holistic and transparent approach to lending doesn’t go unnoticed by consumers.
Q: What role does a combined view of credit and property data play in helping lenders manage risk in our current environment?
Jain: Lenders who are looking at credit and property data in isolation may inadvertently be opening the door for risk. Integrating both sets of information provides lenders with a more comprehensive understanding of a borrower’s true financial situation and property-related risks. This is critical for identifying high-risk borrowers more effectively and reducing the likelihood of defaults. Beyond that, lenders who take an integrated look at credit and property data can proactively outreach to consumers to help prevent delinquencies before they happen, which is helping them mitigate losses while helping consumers protect and maintain their financial health.