Posted in Insights

Record home equity is a lever for engagement

Are your customers taking advantage of record home equity levels? Based on recent data — probably not. But the best way for lenders to capitalize on this record home equity may not be what you expect.

According to a new Blend webinar, the true value for lenders may not be in home equity products themselves but the conversation starter that equity offers.

Dynamics matter

As Julian Hebron of The Basis Point noted, “When we start talking about market dynamics, we’re not just talking about singular products. Every mandate that everyone on the phone today has is to think about their org as a whole and not just think about a singular product.”

Of the tappable equity available today, 65% is held by consumers with credit scores of 760 or higher. “The equity holders have great credit and they want to keep their first lien. So they increasingly become these very high quality home equity prospects,” Julian clarified.

Broad economic factors further support the viability of equity-based marketing. Across the board, the labor market is robust: wage rates are increasing, unemployment rates sit at low levels, and the ratio of job seekers to available jobs has sunk below one.

Engaging consumers

Tendayi Kapfidze, Chief Economist at LendingTree, commented that our current economic reality suggests a “capacity to take on some credit, and with (economic factors like) wage growth, people get more confident about doing those activities.”

All signs point in the same direction: lenders have an opportunity to engage with high-quality, low-risk borrowers to drive adoption of new products.

“What we believe is that equity is a lever for engagement,” Julian stated unequivocally.

Use home equity as a conversation starter. Consumers may be unaware of the equity-based possibilities available to them — or even what home equity is. Once started, lending teams and branch staff can tailor the conversation to best fit the needs of the consumer.

Home equity may be the way to go. But perhaps there is a better product for the circumstances. Either way, the relationship grows.

Curious how you can take full advantage? Watch the webinar above for an expert’s guide to supporting your push for home equity marketing and learn more about Blend’s home equity software solution.

For even more about integrating home equity into your marketing mix, download our home equity report.