Increasing Loan Balances: Start with Current Customers

Equity Acquisition in Modern Financial Marketing

Equity acquisition programs are notoriously challenging, particularly in the current competitive financial climate. Achieving even a 0.1% response rate can be a significant success. To maximize efficiency and return on investment, it's essential to start with current customers.

Leveraging Existing Mortgage Data

The most effective starting point is with your existing mortgage customers. Understanding the remaining balance on these mortgages allows you to calculate available equity and identify eligible customers. This not only enhances targeting but also tailors your messaging. Given today’s interest rates, there’s a chance that equity offers could lead to refinancing – better with your institution than a competitor!

Integration of Mortgage Data

Many financial institutions store mortgage data separately. Collaborating with the mortgage department is key to accessing and utilizing this data. If your institution sells mortgages, maintaining a database of these customers for future equity opportunities is crucial. Additionally, flagging customer records who hold other accounts with your institution can further refine your targeting strategies.

Targeting Under-Utilized Equity Lines

Often overlooked are customers with existing but under-utilized equity lines. These customers are already familiar with equity lines and may need a simple reminder. Analyzing the utilization rates of existing equity lines can uncover valuable insights and guide your targeting efforts.

Beyond the Obvious Targets

While existing mortgage and equity line customers are a primary focus, don't overlook the potential in the rest of your customer base. When budgets are tight, refining your audience becomes critical.

Enhancing Customer Data with External Demographics

Appending external demographic data to your customer information is a crucial first step. This data helps in identifying potential homeowners and provides insights into their current mortgage and home value, estimating probable equity. Combining this with demographic indicators like age and family status can help identify potential markets for equity products.

Building a Predictive Model

The ultimate goal is to move beyond guesswork. Use the appended data to build a predictive model based on the profiles of existing equity customers. Score your customer base on their likelihood of needing an equity loan. Execute targeted communication campaigns (mail, email, digital) and use the responses to refine and improve your model over time.