How to Increase QMs for Millennials Without Changing Your Mortgage Marketing System

You’ve put your blood, sweat, and tears into developing your mortgage marketing system, but just like the rest of the industry, you are faced with the challenges of reaching out and closing a deal with the digital-native millennial buyer. Leads are the backbone of your mortgage business, and with a generation of people who reject the amount of paperwork required to apply for a qualified mortgage, turning a lead into a closed loan is tricky without the right tactics.

There is no need to abandon your best mortgage marketing tools (they are still doing great!). Instead focus on working directly with clients to improve their financial picture, make them better qualified for the protections offered by a QM, and keep the application process a breeze.

Improve the Close Rate by Improving Credit

Lenders can determine a borrower’s ability to repay a loan by considering the borrower’s income, assets, debts, and credit history. Luckily, creditworthiness is the factor on that list that can be changed with your help.

A borrower with a credit score of 720 or above is considered excellent and will receive the best mortgage interest rates available. Experian found that millennials have the lowest average credit score of any generation at 625.

Elevate your clients’ credit scores and their ability to qualify for a QM by repairing their credit.

Offering credit repair will:

• Help mortgage clients find the best loans
• Close more deals for your mortgage business
• Keep you in touch with your clients’ overall financial health

Simplify QM Paperwork

A qualified mortgage is a win-win for the lender and for the buyer.

As a lender this category of mortgage is highly desirable--you won’t face major financial risk if a borrower defaults on their loan. They key is to get the application started in an easy, approachable way for your new millennial buyer.

To apply for a QM, you need to assemble a loan file that includes paystubs, tax returns, W2 and 1099 forms, bank statements, and much more. Simplify this process by creating an online tool for clients to easily upload and send the necessary documents.

The loan file tool should:

• Be available online for fast document uploading
• Use a checklist system for clients to see progress
• Provide a confirmation after all the documents are received

Millenials are used to intuitive, online platforms and when you turn your mortgage application into a familiar tool, you will ease the burden for your clients and increase the number of QMs you close.

Offer Client Education

As a mortgage broker, you are already the expert in understanding the differences and advantages of each mortgage type. Most millennial clients are first-time home buyers and unfamiliar with how to make the best choices.

Offer a webinar or informational email that covers:

• The 3 C’s of mortgage approval - credit reputation, capacity and collateral
• How to build your credit score
• Differences between a QM, and alternative FHA, USA, and Good Neighbor loans

With additional education, your clients will understand the decreased risk and overall benefits of getting a qualified mortgage. You will become an authority and they will know they can reach out to you, their educator, with questions. You will build more trust with clients and close more QMs when you educate clients.

Improve Clients’ Financial Health

Good financial health, from a good credit score to lower debt, increases a millennial's ability to close on a mortgage. After reviewing a client’s answers to all the questions on the QM paperwork, reach out directly to give your expert advice about their overall financial picture. Direct client contact will take your business much further than a mortgage marketing plan alone.

During your post-paperwork meeting, discuss topics like:

• Paying credit card balances down to less than 25% of the available credit line
• Sign up for a credit monitoring service
• Implementing good fiscal habits
• What to do with bankruptcy
• Low debt-to-income ratio
• Benefits of long employment history with current employer

Make QMs Approachable

You already know the advantages of closing a qualified mortgage and you can use that expertise to help your clients finally get their dream home. Your mortgage marketing is already reaching the right audience so focus your time on simplifying how you collect applicants’ documents, offer education on why clients should apply for a qualified mortgage, and show each client that the road to a home follows the path of good credit.

Do you want to learn more about closing more mortgage loans?