Want To Retain More Mortgage Clients? Here’s Everything You Need To Know…

Want To Retain More Mortgage Clients? Here’s Everything You Need To Know…

If you aren’t focussing on retention, you’re probably leaving money on the table (and losing customers you can’t get back in the process).

Don’t just take our word for it though.

Research conducted by Frederick Reichheld of Bain & Company (the inventor of the net promoter score) shows that in the financial services industry, increasing customer retention rates by just 5% produces more than a 25% increase in profits.

No wonder so many other industry experts are focussing heavily on the importance of retention right now.

“The retention market has overtaken the acquisition market.” Those are the words of Esther Dijkstra, director of strategic partnership at Lloyds Banking Group, speaking at the FSE London Expert Panel in September 2018.

It’s a view that Ian Andrews, managing director at Nationwide Building Society, also shared at that event. “In 12 months’ time, retention will be the dominant channel,”.

Furthermore, with the number of purchase customers anticipated to decline this year, competition to retain customers is only going to get fiercer.

There are Benefits to retaining mortgage clients

Now, before we get into the meat of this post, we wanted to briefly touch on some of the benefits of retaining mortgage clients:

  • Past clients are easier to sell to because you already have an established relationship
  • They also tend to spend more than new customers (refinance, second home, etc.)
  • New customers cost more to acquire.
  • Repeat clients naturally promote your business (referrals are still the best and highest converting source of leads).
  • Repeat clients are also more open to your marketing efforts & more forgiving of errors.
  • Client retention helps grow businesses (repeat customers are more likely to explore your services further i.e. they’ll buy more stuff from you)

So now you know why you should want to retain more clients, here are a few of the best ways of doing just that:

1. Stay in touch

By staying in touch with your past clients on a frequent basis, you ensure you are always at the front of their mind. So, when they do have a need i.e. they are in the market for a mortgage, you are (hopefully) the first person they turn to.

It’s no good contacting a past client out of the blue just before they need advice. It will come across as contrived and insincere. In fact, it’s likely they’ll think you only get in touch when you want something, and nobody likes to feel that way.

Stay updated and stay in the minds of your clients (in a professional, non-pushy way, of course). Don’t be one of those advisers who doesn’t even know his client is mortgage shopping. Remain ahead of the curve and you’ll nurture stronger relationships, which will ultimately lead to more repeat business.

You don’t need to sweat for hours over what you’re going to say, either. Something as simple as a birthday or Christmas card is a great way to keep in touch on two occasions throughout the year. It won’t cost the earth, yet will go a long way in your clients’ eyes.

In addition, you may want to create a monthly or quarterly newsletter. It can be as simple as sending your clients links to articles on issues that could impact them. You’ll stay in their minds and be seen as a person who adds value – two things that will stand you in good stead when they remortgage.

Whatever you decide to do, remember, nothing beats high-quality, personalised content i.e. content that relates to the customer’s mortgage. This is an important factor and one that we’ll talk more about later in this post.

2. Add value and educate

Position yourself as a market expert

As we touched on in the previous point, it’s much better to position yourself as a market expert rather than a salesperson. That’s because market experts are held in high regard by their clients and are not viewed as people who only get in touch when they’ve got something to sell. As a result, market experts enjoy better relationships with their clients.

Look to educate your clients at every given opportunity. Whether it’s about changes in the marketplace or ways in which they could save money. By anticipating your clients’ questions, you’ll solidify yourself as their go-to adviser.

For example, highlight how much easier the remortgage process is compared to securing a mortgage when you first buy a property (there’s fewer steps, less paperwork and often the costs are lower etc). There’s a good chance your clients simply don’t know this and will appreciate your input.

Anticipate consumer anxieties

Because consumer mortgage journeys are non-linear, there’s always an opportunity to add value.

Major life events, such as births, deaths, marriages, a new job, etc., impact your clients’ lives. However, they also potentially impact their home/mortgage situations too.

At a time when your clients are likely already feeling anxious, you can stand out as someone they can talk to when life events occur.

Again, why not have pre-prepared documentation to cover such eventualities? It will allow you to serve your clients better and add real value (both of which improve retention).

Provide clarification

Many consumers feel intimidated when they encounter mortgage jargon. It’s something they are unfamiliar with. That’s where you come in.

Be available to help your clients decipher documents that are full of jargon. When you send out your own comms, put information into easily digestible formats, allowing your clients to make fully informed decisions.

If you want to take this one step further and really wow your clients, consider creating your own jargon-busting guides and sending them to your clients ahead of time. This will not only portray you as an adviser who’s conscientious but also give you a great excuse to stay in touch on a regular basis.

3. Embrace your data

Hidden away in the darkest depths of your CRM system is a treasure trove of data. Data that relates to your clients and that can provide you with extremely powerful insights into them, their behaviours, their motivations and their pain points.

By harnessing this information, you can create highly-personalised communications that engage your clients and significantly boost your chances of securing more repeat business.

But do you know how to extract and manipulate the data you hold on your clients? If not, you’re missing a big trick.

4. Take advantage of automated retention software

Automated mortgage retention software does exactly as its name suggests. As well as taking the pain out of client retention, it also ensures you are in the most favourable position when your clients need your services.

You can significantly reduce the chances of missing retention opportunities by having timely and prioritised insights delivered straight to you.

With automated mortgage retention software, you can make sure that you:

  • Always be the first to contact your clients
  • Maintain their interest on an ongoing basis with the right content delivered at the right time
  • Save massive amounts of time and effort, while driving positive results

Automated mortgage retention solutions, like Eligible.ai, enable you to focus less on data mining (in fact, you won’t need to do any at all) and more on nurturing your client relationships and helping them find the perfect mortgage deal.

Final thoughts

As we mentioned at the very start of this post, mortgage retention is only going to go from strength to strength over the next 12 months (and probably long into the future).

So, don’t forget to:

  • Stay in touch with your mortgage clients on a semi-regular basis
  • Provide them with real value – even when they are not in the market for a mortgage product
  • Boost engagement with your clients by harnessing big data insights to create personalised, timely communications
  • Take advantage of automated retention software, like Eligible.ai

If you don’t show your past clients some love, there’s a good chance they’ll look for it elsewhere.

Make sure to stay on top of your client retention to maximise your revenue.

Client retention has to improve

Client retention has to improve

“The following piece about Eligible appeared in Mortgage Introducer on 25th March 2019. Click here to view the original article.”


Over the past two years, Eligible has conducted in-depth research with clients and advisers to understand how technology can enhance the client relationship.

We realised that in a rush to speed up applications, optimise fact finds and create client portals, the retention of the end client has been neglected. A great example of this: advisers talk to their clients once every two years! As a result, the client has mostly forgotten the things they had learned from their adviser.

The client journey is broken – clients remain scared by jargon and lack understanding when it comes to their mortgage.

The financial services sector has created its own barriers to entry with technical language that alienates the very people we want to help. Many clients are anxious about talking to their broker because they feel out of their depth.

Improving the client experience

Our conclusion is that what the industry needs and clients want is relevance in communication. One size does not fit all and for too long, people have acted in this manner and expected results to improve. We must learn to relay complex concepts in simple, relevant and personalised ways to each individual client. The good news is that technology has become more accessible to enable firms to do this.

Our focus is on bringing the idea of nurturing client relationships to the mortgage industry. This is fundamental to creating a lifetime relationship with your clients where you are advising them for 10, 20 – even 30 years!

In our research, it was clear that improving financial literacy for the end client was important for the health and viability of a long-term client relationship. This can only be done by contacting and engaging the client with information that is relevant to them at that point in their life. Once you can communicate effectively with your client, you are best-positioned to be their trusted adviser for life.

How does technology fit into the client relationship?

It allows advisers to turn their existing customer data into personalised journeys to nurture the client relationship and lead that client back to their adviser when it is time to remortgage. We want to make sure that more phone calls and F2F meetings take place between clients and their advisers. Our experience and studies have shown such interactions lead to happier customers and more revenue, and nothing can replace them in either the eyes of the client or the adviser.

Some food for thought – replace the words “big data” with the words “big understanding.” Data allows you to understand your clients better but only if you learn to act on what it teaches us.

We are really happy to welcome Hemel Shah to the team

We are really happy to welcome Hemel Shah to the team

Hemel, ex-partner at John Charcol, has been tasked with developing B2B relationships and providing feedback on what’s important to brokers.

Hemel’s appointment shows our intention to always keep our customers at the heart of our business whilst pushing the technological envelope.

Hemel’s experience in the mortgage industry gives us vital input to create solutions that generate immediate value for the business whilst being simple and easy to use.

Hemel is here to help us bridge the gap between our technology and what brokers want.

Rameez Zafar, chief executive at Eligible

The market has been inundated with technology that focuses on ‘digitising’ the sales process but retaining the client relationship has been overlooked.

I have spent some time considering my next step and although there are numerous technology firms in the industry, there are few innovators genuinely looking to achieve the best outcome for both the broker and the client.

I look forward to working with client focused businesses that are passionate about building great client relationships.

Hemel Shah, Sales director

 

Want to find out more?

If you’re interested in finding out more feel free to Request a demo or get in touch.

Mortgage brokers it’s time to prove your lifetime value (or lose your clients forever)

Mortgage brokers it’s time to prove your lifetime value (or lose your clients forever)

Competition for your clients is increasing.

Nearly half of all product transfers done in 2018 was done on a non-advised basis. As the FCA highlighted in their Mortgage Market Study Interim Report, a significant minority of consumers (30%) purchase a mortgage despite there being an alternative mortgage that was “unambiguously cheaper than their chosen product”.

As brokers, we understand the value of the advice we give to the clients when we see their feedback and the positive outcomes on a daily basis. However, we need to adapt our behaviours to convey this value to our clients. Expectations around the services we offer and how we communicate with clients is ever-changing and we need to ensure that we keep up with these changes.

The current environment means more clients are taking five year fixed rates – nearly half of all fixed rates taken in 2018 were five years or more. Clients are more likely to require advice on options they may not have considered previously such as porting, further advances and second charge loans, as well as the other important decision brokers are often called upon to help with such as weighing up the financial and emotional costs of moving versus home improvements; if and how they should consolidate debts. These areas are increasingly likely to be the time where brokers are able to demonstrate the lifetime value of their advice over the alternatives.

One of the most neglected aspects of a brokers role is managing the client journey from the point of completion through to the end of the initial product period. There is a huge opportunity to improve this journey with regular, targeted communication that reminds the client that their broker is still available to them and their best source of knowledge.

Adding value to the product transfer process

Lenders are focusing more on client retention and improving the ease with which you can switch products. Whilst a broker may not be able to offer the same level ease of clients as a product transfer, they can add demonstrable value by conducting a market search to ensure the client is really getting the best product for their needs.

Whilst product transfers often pay a lower proc fee, they provide brokers with the opportunity to keep that client informed and active in their client bank. When a client cuts out the broker on a product transfer, the likelihood of that client returning in the future drops off a cliff. You lose the relevant information about their new mortgage and can’t communicate as effectively with them when their new product ends.

Whilst no two clients are the same, having a client-focused, robust, compliant processes will ensure that clients received a smooth, consistent journey in every interaction.

We know that brokers improve their client’s experiences and feelings towards their mortgage. We need to remind our clients of the value that we add over the lifetime of their mortgage and the benefit of regular conversations with their broker.

Want to find out more?

If you’re interested in finding out more feel free to Request a demo or get in touch.

Client Retention Is Important!

Client Retention Is Important!

The Technology Behind Client Retention

In virtually all industries, repeat business typically represents the highest quality business at the lowest “customer acquisition cost”. The mortgage industry is no different, where in many instances, the highest margin business is advising existing clients on remortgaging – because its those clients that cost the least to acquire and require the least amount of time and effort to complete.

Yet the institutional and systematic support for retaining – or, even better, maintaining – these clients relationships is often lacking. Technology, and a new breed of service providers to the mortgage industry, is developing quickly to overhaul the means of retaining these existing high-value clients.

 

Current House Price Trends Are Increasing The Importance Of Remortgages

The importance of remortgaging business to advisers and lenders is being accentuated by the current house price dynamic, particularly in London and the Southeast., Remortgages have become a bigger part of the mortgage market as house price appreciation has slowed and the number of transactions has fallen. In fact, in the first quarter of this year, remortgages overtook “house buyers” as the largest category of borrowers.

 

Rising Interest Rates May Prove A Catalyst To Remortgage

At the same time, interest rates remain near record lows, meaning many borrowers would benefit from remortgaging – although the tables may be turning…

Recent indications from the Bank of England suggest that it will increase its Base Rate before year end. Swap rates, upon which mortgages rates are typically based, have already increased substantially to reflect this: 5-year swap rates have moved from 0.5% to 0.75% over the past two months . Rates remain extremely low by historical standards, but they have begun to move higher – providing a catalyst for borrowers to remortgage now.

As interest rates have kept falling in recent years, despite repeated proclamations that they are “as low as they can go”, consumers have perhaps felt that it is their interest to wait to remortgage. However, if the current uptick in interest rates continues and particularly if it is spurred on by a high-profile move by the Bank of England to increase its Base Rate, consumers may see rising rates as a catalyst to remortgage “before it’s too late”. In short, the friction created by changing interest rates is likely to spur demand for remortgages.

 

The Increasing Impact Of Technology

The conclusion from all of this is something that the mortgage industry – indeed many industries – has always intuitively known: customer retention is important!

The good news is that technology, when deployed properly, can provide transformative support to client retention. From ad-hoc digital engagement that keeps an existing client “warm” to systematic, timely prompts so advisors know when to proactively re-engage customers that would benefit from remortgaging, technology can help efficiently harness this pool of high-quality, repeat customers.

Many of these approaches draw on lessons learned in similar industries, like financial advisors or wealth managers, including some of the tools associated with robo-advice. “Fintech” service providers now entering the mortgage industry are focused on digitizing parts of the industry that will benefit from the efficiency gains of increased automation.

But it’s not just about providing customer management services to advisers and lenders. Technology is here to improve the customer journey: to make the interactions with the providers of mortgages more impactful – and simpler. As customers utilize better, more digital experiences in other industries, they will come to demand of it of mortgage arrangers and providers. The mortgage industry must meet that demand, or incumbents will be challenged by new entrants that will.

 

The Human Adviser Will Remain At The Heart Of The Relationship

One-to-one advice and a tailored product offering based on a true understanding of a client’s needs are best achieved under the direction of a real person. The technology is here to make that person’s job far more efficient than it has been in the past.

By utilizing the appropriate technology, advisors and lenders are able to craft an appropriate hybrid approach: one that encompasses both the efficiency gains of technology and the unique benefits of the human touch.

Eligible is the UK’s first white label digital mortgage platform for intermediaries and lenders alike. One of its core products, Mortgage Watch, is a remortgage analytics and digital customer engagement tool that optimizes the management of existing customers in order to increase client retention.