There are approximately 86 million Millennials – people born between 1980 and 2000 – in the United States today. This represents a substantial opportunity for mortgage lenders – if they can evolve from a traditional approach to one that addresses the unique traits of this demographic.
Factors such as household formation, renting, student loan debt, technology and relationships with financial institutions play a significant role.
By numbers alone, Millennials represent massive opportunity for lenders. However, factors such as underemployment, unemployment and student loan debt have impacted this group more intensely than previous generations, culminating in a tendency of renting vs. buying.
But as the economy continues to improve and employment steadily increases, independent household numbers will increase, and those looking to buy homes will also surge. This is when education, insight and a refreshed approach can tip the scales in lenders’ favor.
By providing advanced technology in tandem with high-quality customer service, they can attract and retain new business. Taking a multi-pronged approach in strategy will provide them with a solid foundation as this generation gains confidence with the concept of purchasing a home.
Millennials stand apart from previous generations due to their immersion in technology. It is a logical extension that they will also conduct their mortgage shopping online.
This affords mortgage lenders an opportunity to educate, engage and encourage Millennials, guiding them through the mortgage process.
Inform them about the benefits of buying a home as well as the home buying process – before this process begins.
Offer courses about a variety of financial topics, including mortgages in short and digestible format.
Remember that engagement with this generation should not be seen as a one-sided, one-time interaction.
Be a partner, not just a provider, in the financial process, someone who can guide them through mortgages and more.
Maintain a web portal, where borrowers can apply quickly and easily.
Provide calculators and short, educational information for borrowers to access.
Offer mobile capture technologies to allow your borrowers to upload documentation to their loan file—from anywhere, anytime.
Provide electronic signing of documents—whenever possible.
Be transparent, follow up and proactively communicate throughout the process.