8 Can't-Miss Mortgage Lead Strategies You Must Do In 2022

Written by:
Aaron Norris
Written on:
December 17, 2021

Record equity in 2022 will make for some exciting opportunities for data driven professionals. Are you ready to strike while the iron’s hot?!

Generating mortgage leads can feel like an unbreakable ebb and flow cycle. But if you’re a data driven mortgage pro who knows where to look, you can skip the ebbs and keep your pipeline full with a consistent flow of mortgage leads no matter the market conditions. And if you’re not a data driven pro yet – you will be after reading this post.

Here’s the deal. Mortgage professionals have had two of the most profitable years on record. Low-interest rates combined with record-breaking home prices meant big business for purchase-money and refinance loans.

Most industry associations are predicting that home price appreciation will slow in 2022. Recent unemployment and inflation data have many predicting that the Fed will increase interest rates as soon as Spring 2022. Rising mortgage rates cause concern for fear it could end the purchase money and refinance boom.

However, data-driven mortgage professionals know that despite these industry headwinds, mortgage professionals will thrive in 2022 by focusing on strategies that take advantage of this unusual market cycle and the massive equity gains that have occurred in record time.

4 Important Trends Heading Into 2022 That Are Informing Our Mortgage Lead Strategies

There was little way to know how the pandemic would shape consumer behavior in housing. With businesses creating work-from-home and hybrid work models, consumers could reimagine and reprioritize life. Suddenly, the home became where you live, work, play, and educate. Consumers had the flexibility to move closer to family, relocate to places with more space, and find properties that better fit their needs and budget.

Record Equity Gains

Strong demand combined with low inventory was a recipe for record-breaking price appreciation and massive equity gains. The US Census shows the median sales price grew 19.9% from Q3-2020 to Q3-2021, now $404,700. The only comparable year is 1973, when home prices increased 20.1% in that same year-over-year timeframe. That loan you originated only one year ago is now likely sitting on close to 20% equity!

Median Sales Price of Houses Sold

Record equity in 2022 makes for great mortgage lead opportunities

Source: U.S. Department of Housing and Urban Development

Rising Loan Limits

In November, The Federal Housing Finance Authority (FHFA) released the 2022 conventional loan limits for Fannie Mae and Freddie Mac. FHFA uses the Housing Price Index (HPI) to calculate new limits. From Q3-2020 to Q3-2021, the index rose 18%. The new conforming limit for single-family homes also increased 18% from $548,250 in 2021 to $647,200, a nearly $100,000 increase. High-cost areas increased from $822,375 in 2021 to $970,800. For reference, in 2016 those limits were $424,100 and $721,050, respectively.

Housing Price Index

Housing price index graph

Source: Monthly FHFA House Price Index.

With these new loan limits, qualifying borrowers now have affordable lending options since Fannie Mae and Freddie Mac are operating in loans amounts once only available through jumbo mortgage professionals at higher rates. With low inventory still an issue, areas with strong wage and job growth could continue to experience home price appreciation in 2022.

Aging Population

The US Census estimates there are roughly 73 million baby boomers (born between 1946 and 1964). The 65-and-older population has grown rapidly over the past decade, so much so, it increased the national median age from 37.2 years in 2010 to 38.4 in 2019. Recent inflation may require more seniors to look at products like reverse mortgages to manage increased living costs. With record equity gains, seniors will thankfully have the ability to tap into home equity to pay for retirement, healthcare, and recreation.

Rising Interest Rates

Late in 2021, the Fed signaled it would slow quantitative easing and potentially increase the Fed Funds Rate three times in 2022 to address rising inflation. Many in the mortgage industry fear this could mean mortgage rates could increase as soon as Spring 2022, putting a damper on loan origination and perhaps even home purchases. However, equity gains, increased loan limits, and shifting demographics signal different opportunities for mortgage professionals in 2022 in the event purchase mortgages slow.

8 Top Mortgage Lead Strategies for 2022

1. Loan Consolidation Leads

Consumers often use second mortgages as a strategy to put less money down when purchasing a home, refinance high-interest-rate debt, or pull money to take care of home repairs. Second mortgages have higher rates than first mortgages. Mortgage professionals could greatly help owners with seconds refinance into a single, long-term loan with a lower rate than their current blended rate on existing mortgages.

The data needed to discover these mortgage leads will be properties where the owners have more than two loans and the combined loan-to-value is less than 80%. See this sample quick list for PMI elimination leads in Florida with an estimated 378,000 loan consolidation leads.

2. PMI Elimination Leads

Private mortgage insurance, or PMI, will be a no-brainer strategy for 2022. Imagine reaching out to any customer that closed a loan with you over the last three years, letting them know you can save them money. Depending on the loan amount, it could easily mean hundreds in savings every month. Even if mortgage rates increase in 2022, getting rid of the PMI means more money in your customers' pocket, which would help offset slight increases in loan amounts. Actively managing past loan clients could also be a boon for the referral business.

The way to discover these PMI mortgage leads is by looking for properties where the current first mortgage has a loan-to-value of more than 80%, and the present combined loan-to-value is now less than 80%. See this sample quick list for PMI elimination leads in Texas where there is an estimated 1.1 million PMI elimination leads.

3. HELOC and Cash Out Prospect Leads

Inventory was so low in 2021, it isn't unusual to hear stories of buyers overpaying for properties due to stiff competition. This sometimes led to owners being unable to do needed or wanted repairs since they had to bring more cash in to close the deal. With equity gains, mortgage professionals can help even recent clients obtain HELOCs, allowing them to do home repairs, pay off high-cost debts, or even pay for college tuition.

The data used to source HELOC leads looks at properties with a combined loan-to-value of less than 70%. See this sample quick list for HELOC loan leads in Idaho, where there are an estimated 453,000 leads.

4. Cash-Out Refinance Leads

Unlike a HELOC, a cash-out refinance locks in today's interest rate for the life of the loan. Depending on how the consumer plans to spend the money, even if mortgage rates increase, the new loan rate may be far superior to what the customer will pay on credit cards, school debts, and other high-cost debts.

The data used to source cash-out refinance opportunities looks for properties with at least 30% equity. See this sample quick list for cash-out refinance loan leads in Missouri, with an estimated 1.2 million loan leads.

5. Renovation Loan Leads

Some consumers choose to upgrade and renovate their current homes instead of going through the hassle of moving. With renovation loans, the property's age is a key criterion to discover renovation loan leads for products like Fannie Mae's HomeStyle Renovation Loans or Freddie Mac's CHOICERenovation Mortgages. Some states are promoting the construction of accessory dwelling units (ADUs) to address housing shortages. Renovation and cash-out refinances are two loan strategies that can help owners get the money they need to construct these secondary units, which can serve as a home office, flex space, space for aging parents, or to produce extra income for the family.

The data used to source renovation loan leads include properties at least 20 years old where the owner has 30% or more equity. You can further drill down to specific periods by looking at the transfer dates. See this sample quick list for renovation loan leads in Tennessee where the owners purchased the property between January of 2014 and December of 2017. There are currently an estimated 160,000 loan leads with these criteria.

6. Reverse Mortgage Leads

10,000 Baby Boomers are retiring every day. Seniors on a fixed income may not be as equipped to handle inflation, and their homes may be a great source of money to help them in their retirement.

The data used to source reverse mortgage opportunities use owners at least 62 years old with an estimated combined loan-to-value of less than 50%. See this sample quick list for reverse mortgage leads in Georgia, with an estimated 717,000 loan leads.

7. Cash-Out Refinance for College Leads

The UC system saw record numbers of college applicants thanks to waived standardized testing requirements during the pandemic. Parents looking to find a less expensive way to finance higher education need to look no further than their home equity.

The data used to source college loan leads looks for an estimated equity position of at least 30% where the owner has children ages 16-17 in the home. See this sample quick list for cash out for college loan leads in California, with an estimated 450,000 loan leads. Other interesting criteria to stack include whether or not the current owners themselves have college degrees making it more likely a college education is a priority for the family.

8. Landlord Bulk Refinance

Investors who purchased rentals starting in 2009 often purchased rental properties far below replacement cost. Loan originators who work with flip investors know that investors can be a great source of leads when flipping and reselling to owner-occupants. However, landlords offer another lucrative opportunity. Landlords with rental portfolios can save thousands monthly by refinancing out of hard money or vintage loans at higher interest rates. While portfolio refinances can take work, the payoff is doing numerous loans at one time.

The data used to source landlord portfolio refinance leads looks for owners with 10+ properties. See this sample quick list for landlord bulk refinance leads, narrowed by looking at properties purchased in Nevada between January 2009 and December 2017. There are 21,000 loan leads in Nevada that meet these criteria.

Connecting with Your Mortgage Leads

Pulling mortgage lead lists using a tool like PropertyRadar that includes enhanced public records data and criteria like demographic data, email addresses, and phone numbers open new ways for lenders and loan originators to connect with current customers and prospects. Not only can messages be tailored to one of the eight strategies listed above, but marketing can also be highly personalized for increased engagement.

Mortgage professionals may want to expand or stack marketing channels in 2022 using the following, but be sure to always follow our good neighbor marketing pledge.

Direct mail. Mailers have long been a staple marketing channel for the mortgage industry. Lists that are hyper-local and hyper-targeted, with messaging that is personalized, will always deliver better ROI than the always-too-common spray-and-pray marketing method.

In 2022, don't forget that design matters. From the shape and size of the mailer to the branding and colors used to communicate your lending programs, explore new ways to stand out in 2022. When testing new designs or messaging, carefully select one thing to change at a time.

Cold Calling. If a contact asked for information within the past three months or they've closed a mortgage loan with your business in the past 18 months, you have an established business relationship that allows you to contact them via phone. If cold calling or text marketing are channels you want to explore in 2022, see the good neighbor marketing pledge.

SMS & VMD. A close sibling to cold calling is text marketing and voice mail drop. Text marketing has become wildly popular because of its 98% read rate and low delivery cost. Make messages sound more human than robotic, make it easy to opt-out, use a real phone number, and keep records of consent. Follow the good neighbor marketing pledge will help guide your text and voice mail marketing in 2022 and beyond.

Email Marketing. Email marketing will continue to be a popular outlet in 2022. Permission-based email marketing is not only a best practice but imperative if mortgage professionals want prospects and customers to see their message. And why not. Email marketing has proven time and time again to deliver on the ROI.

Among other things to be aware of, a general rule of thumb to keep in mind is, as you're developing marketing funnels, double opt-in permissions are the way to go to stay compliant.

Facebook marketing. Customer matching on Facebook allows you to use email addresses from existing mortgage customers and lists you create within PropertyRadar to market directly on Facebook. Drive leads to your own marketing channels and get opt-in permissions for marketing channels you control.

Unique Mortgage Lead Opportunities Abound For You In 2022

Purchase mortgages will keep mortgage professionals busy in 2022, but the huge increase in equity gives you new opportunities to keep your pipeline full of quality leads and generate business in 2022 and beyond.

If you're ready to grow your business and want access to the opportunities we just discussed, sign up for your free trial with PropertyRadar today.

Written by:
Aaron Norris
Written on:
December 17, 2021