Home purchases didn’t spike this spring as they have in past years. This comes as no surprise, with the COVID-19 pandemic still looming in the background. The Canadian Real Estate Association (CREA) shared that national home sales and new listings were up 56% in May compared to April, but this is still low compared to the averages in previous years. Purchases in May were down almost 40% compared to the year before and recorded the lowest volume of sales compared to any other May since 1996.
While purchases have slowed, they haven’t stopped and mortgage brokers managed to keep busy, with borrowers calling to help with processes to defer payments and refinance requests skyrocketing. The concern lies in what we can expect in the fall.
“It’s kind of a wait-and-see situation. We’re hoping with the reopening of the economy, people will have no issues qualifying for mortgages, but there is a concern about a second wave of the coronavirus. We’re trying to be optimistic, but it’s really uncharted grounds,” said Gregg Paul, vice president of industry relations at Lendesk.
Paul suggests three ways that brokers can prepare for times ahead, as uncertain as they may be:
Incorporating more flexibility and agility into the workflow is more important than ever to connect with borrowers of all ages. Millennials and Gen Z borrowers are of course more reliant on technology, but an increasing number of baby boomers are also starting their searches online.
“Having a really clean, simple, organized website that guides borrowers through the process and eliminates the conversation that bogs the process down is really what’s needed today,” said Paul. “This also allows the broker to work while they’re sleeping, so to speak.”
He recommends a move away from manual work wherever possible. Traditionally, brokers update spreadsheets to keep track of active rates, but Lendesk’s Spotlight Search collates information on rates, but also on policies and guidelines so brokers don’t need to go through tons of emails from different lenders in order to find what’s best for the borrower. And with rates changing so often, this can get overwhelming and not up to date!
“Immediately, if not sooner, is the expected timeframe to respond to people, or else they move on,” said Paul. While it’s not always possible to respond immediately there are methods that can be implemented to help. Brokers should ensure they have a CRM in place and one that can automate marketing messages. Something as simple as an automated email when a borrower completes a form on your site can do wonders. The email can let them know their query is being addressed, reassuring the borrower that they’ve been heard.. Chatbots or other forms of AI can help keep borrowers locked in instead of shopping around or walking into their local bank.
The younger generation of borrowers are happy to do the heavy lifting once the process is clear and frictionless. “If you think about Uber and DoorDash, these types of services deliver immediately and digitally, with minimal face to face time. Borrowers don’t distinguish between their experiences so expect the same when it comes to getting a mortgage, choosing the path of least resistance” he said. “Brokers need to be able to provide a frictionless digital experience in order to compete.”
Mortgage products are no longer cookie cutter, so more creativity and knowledge are required, especially when it comes to demonstrating the complete value of a product and not just a rate.
Spotlight Search helps brokers find the best lender rates and policies and compares products that will fit in each unique scenario within seconds and with laser focus.
“You can compare and share options that display the different scenarios based on rate, but also the flexibility of the mortgage, what the penalty would look like if you do need to pay it out,.,” said Paul. “It just gives the consumer an air of confidence if their mortgage professional is providing them with several options.”
Another great feature about Spotlight Search is the speed and accessibility. Through Spotlight Search, brokers can filter through hundreds of rates and thousands of policies, in seconds. With the newly added feature compare and share, brokers can compare mortgage rates and comprehensive policies, line-by-line in real-time, and export them as a package to be easily shared with clients in a secure, professional, and accessible way. All of this can also be done on the go, with the Spotlight Search app for iOS and Android.
Paul says some of the most successful brokers have already started reaching out to everyone they’ve worked with in the past, offering financial check-ups.
“This is an opportunity for brokers to genuinely help Canadians during a tough time,” he said. “Maybe they want to move and need a new mortgage or they want to consolidate payments, reaching out and proactively looking at scenarios where they can help will also lead to referrals, help brokers stay top of mind, and make a difference to many families across the country.”
VP Industry Relations