Marketing Goal
Increase the retail loan portfolio with the larger volume numbers available through home mortgages. Depending on the current rate environment, the new mortgage or refinance markets could both yield substantial prospects.
Target Market
- New Mortgages: WordCom would analyze your customer database to find likely new mortgage candidates among existing customers, as well as using selected prospect list sources to identify families either likely to purchase their first home or upgrade to a larger one. In both cases, demographic data of age and income would enhance the selection process.
- Mortgage Refinance: While current mortgage customers are usually avoided, it should be remembered that your mortgage customers who are paying higher than market rates are another bank’s best prospects! Prime targets among your existing households are equity line/loan customers who have their mortgage with another bank. Externally, we could look for prospects who likely bought their homes during times of higher interest rates.
Program
- The Message: For new mortgages, the messages to the possible first-time homeowner would stress the information and assistance available through the bank. To the existing homeowner, we would stress how easy it would be to get a new mortgage or refinance their old one — especially if they are already existing customers.
- Timing: Most markets have seasonal fluctuations when people are actively in the market for a new home, but the refinance market is usually rate-driven.
- Mailing Package: The mailing package to existing customers should be personalized and attractive, and new prospects could receive more economical postcard or self-mailer pieces. All should use graphics attached to money and talk in plain and simple terms about the benefits of acting or refinancing at the current time.
Results
One example of a mortgage refinance program showed a bank mailing to only 6,000 non-customers at a cost of $8,000. In addition to the new business produced by the 1.5% response rate, they enjoyed the benefit of fee income (from points at closing) of $77,500! A great ROI.
Case Study: Mortgage Refinance »
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