Higher FHA Loan Limits Will Help Loan Origination in 2012

The higher FHA loan amounts will no doubt help lenders and brokers increase their loan origination in 2012. President Obama signed the bill that extends higher loan limits for FHA.  Borrowers that need a FHA loan amounts up to $729,750 will be excited. FHA still only requires a 3.5% down payment even if you are a first time home buyer. The higher FHA loan limits will offer significant relief in high-cost areas of California; metropolitan Washington, D.C.; New York, New Jersey and scattered counties in other states including Massachusetts, Florida and North Carolina. The higher loan limits were not extended for Fannie Mae and Freddie Mac. Most believe that the program called Home Affordable Refinance will help the borrowers trying to refinance a loan owned by Fannie or Freddie.

Mortgage Lead Podcast

Mortgage lead activity continues to increase, as compared to the previous month.  Interest rates are higher, but loan applicants are back online seeking home loans.  Refinance leads are up nearly 2% and purchase lead volumes are up 9.6% from December.  FHA leads continue to be the most requested lead type.

Listen to the Lead Planet Mortgage Lead Podcast below:

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Home Loan Leads Activity Up

Home loan leads rose significantly last week, increasing 14.4% to hit their highest level since May of this year.  According to the Lead Planet weekly lead report, purchase leads have now risen for four of the past five weeks.  Over the past four weeks, the MBA’s Purchase Index has raised an average of 4.0% a week. According to Michael Fratantoni, MBA vice president of Research and Economics, “The increase in home loan leads last week aligns with other incoming data suggesting that consumers are feeling somewhat more confident with their financial situation.”

The activity of refinance leads fell 1.0% for the and are currently at their lowest level since June, despite interest rates that remained relatively stable after a sharp jump the previous week following the Federal Reserve’s announcement that it would purchase $600 billion in Treasury securities to boost the economy.  Refinance leads have been falling over the past month even as home purchase applications rose. Refinance leads are down an average of 4.8% over the past four weeks, despite expectations by many analysts that the recent rise in home loan rates would motivate fence-sitting homeowners to act before rates go any higher.

Lead Planet Posts Mortgage Lead Survey

The Lead Planet has been tracking mortgage lead online since 1999.  Each month we publish a mortgage lead survey that researches the mortgage lead generation results from over 1,000 home finance websites in the U.S.  The survey tracks the volume of online loan applications taken by mortgage lenders and bankers. The data gives mortgage companies a view of the consumer demand for home mortgages online.  The Lead Planet introduced the Mortgage Lead Report to act as a gage by measuring internet mortgage leads generated online. 

The Lead Planet Monthly Mortgage Lead Survey Tracks the Following Types of Loan Leads Online:

Refinance Leads Purchase Leads Home Equity Leads Debt Leads SubPrime Leads Loan Modification Leads

Internet Mortgage Lead Generation Campaign Improves with SEO

In the monthly mortgage lead generation report, the Lead Planet announced a significant improvement in lead quality from the previous month.  Internet mortgage leads converted over 17% better in June than in May!  Our mortgage clients reported better credit quality and higher conversions on both purchase and refinance leads! A spokesman for Lead Planet said, “As an internet mortgage marketing company we utilized our own search engine marketing strategies to focus on keywords that drove traffic to loan applicants with better credit scores.” 

Our mortgage SEO solutions continue to help our clients in multiple ways because we are able to target specific niches through precise internet mortgage lead generation campaigns.  Whether it’s VA, FHA, conforming or jumbo, the Lead Planet has the ability to significantly increase search engine ranking for most mortgage websites that display original content.

Call 619-600-5720 to get more information on mortgage lead generation, search engine optimization and custom websites that rank high and perform well on Google, Yahoo and Bing.

Refinance Lead Activity Jumps

The good news for mortgage professionals last week was that refinance lead activity rose to its highest level in over a year. Lead Planet chief economist, Kevin Grant announced Friday that refinance applications increased 5.9% to 2116.3. The overall rise in mortgage leads online crept up 6.6% from the previous week. Grant said that this was the most significant increase since May of 2009.” The Mortgage Bankers Association said in their report that the Refinance Index increased 12.6% from the previous week. MBA also indicated that the adjustable-rate mortgage share of activity decreased to 4.7% from 4.9% of total applications from the previous week.

The average mortgage rate for 30-year fixed-rate mortgages fell to 4.67% from 4.75%, with points decreasing to 0.96 from 1.07 for 80% loan-to-value (LTV) ratio loans. This is the lowest 30-year mortgage rate recorded in the survey since the week ending April 24, 2009. The effective interest rate also dropped from last week.

The average mortgage interest rate for 15-year fixed-rate mortgages dropped to 4.06 % from 4.19%, with points decreasing to 0.97 from 1.00 for 80% LTV loans. This is the lowest 15-year mortgage rate ever recorded in the survey. The effective rate also decreased from last week.

The average home loan rate for one-year ARMs was unchanged at 7.05%, with points remaining constant at 0.27 for 80% LTV loans.

Whisperings of Mortgage Professionals – Mortgage Lead News

Home mortgage rates dropped to record lows last week, but many mortgage brokers and lenders were not cheering. With banks offering more affordable home loan rates than ever before, you would think the professionals selling interest rates and finance opportunities would be more excited. First of all mortgage rates have been ridiculously low for several years. Second, the mortgage guidelines have tightened to the point that not that many loan applicants qualify. Mortgage leads have increased slightly over the last few weeks, but most applicants simply do not qualify.

The new finance reform bill comes down hard on loan professionals for misconduct and fraud. Sure some of the requirements for mortgage lending need to change, but fairness seems to be disappearing from the reform bill. Privately many mortgage brokers are concerned that our government is trying to cap their income. Most of us believe that in America, the land and the free that you should not have your government limiting your income. According to BofA mortgage executive, Jeff Moran, “There seems to be two sets of rules —-One for the conventional mortgages and another set of rules for the government backed home loans.” Moran continued, “With our economy and housing sector in such a fragil state, it is imperative that we make industry changes that protect consumers yet do not hinder genuine home financing opportunities that will help people in our economy get back on their feet.

Is it fair that the government that was involved in pushing risky loans to unqualified borrowers should be dictating how much money we should make? The competitive nature of the mortgage business has been the driving force for new lending products and finance opportunities that have helped this great country expand. The notion that our government is implementing restrictions on our industry yet the government mortgage products are exempt from disciplinary repercussions is maddening.

What can you do? Be vocal and get involved with groups like the Mortgage Bankers Association and local groups like California Association of Mortgage Brokers. There are local mortgage associations in every state, so get involved. Partner with mortgage marketing companies like the Lead Planet who will support you with industry news and internet mortgage leads that will help increase your cash flow. Call 619-600-5720 to get more information on new mortgage lending opportunities and online mortgage lead promotions.

Originate More Loans Buying Purchase and Refinance Leads

I noticed that we have been getting a lot of inquiries for mortgage refinance leads lately.  That is not unusual, because traditional mortgage shops who have been buying internet mortgage leads for years like refinance leads.  That is what they have been originating when rates were higher and that is what they originate today as the interest rates have fallen to record low levels.  No one will argue that low rates are a good time, but refinance guidelines have been tightened more in the last three years than ever before.  A few years ago, millions of borrowers bought their home with a stated income loan, but today lenders are not offering stated income loans so most of these loan applicants are turned down when trying to refinance their mortgage.  Clearly the pool of qualified refinance applicants has shrunk so in most cases loan companies will have to buy more refinance leads to get a qualified borrower. This means higher credit report bills and an increased investment for mortgage marketing. 

Direct mail costs have risen and the return rates have been lower as well.  Many loan companies are surviving with internet mortgage leads, but the companies that seem to be funding the most loans every month are the shops that are buying both purchase and refinance leads.  Many loan officers say they don’t like home purchase leads as much because the prospects are not always ready to buy a home.  That may be true, but the purchase market is much hotter than the refinance market right now, so mortgage companies should be more opened minded to work purchase leads in addition to their beloved refinance leads.  The fact exists that there are more qualified purchase mortgage applicants than refinance applicants.  Most qualified homeowners have already refinanced to a mortgage with a fixed rate in the 5% range.  Most of the refinance applicants do not qualify for home refinancing because they have no equity or their credit scores are too low.  The Lead Planet recommends buying mortgage leads with filters of a blended mix of both purchase and refinance.  Take a minute and call the Lead Planet at 619-600-5720 and we will show you how to maximize mortgage lead buying opportunities with no obligation.

Comparing Internet Mortgage Leads to Trigger Credit Leads

I get some interesting questions from mortgage marketing executives from time to time.  Today a representative from one of the larger banks asked me to compare internet mortgage leads to trigger leads.  This person was told that trigger leads have a better conversion ratio and so they wanted to know why they wouldn’t want to shift their mortgage marketing dollars.  I decided it would be a good idea to discuss the benefits and risks of both internet loan leads and trigger leads.

Online Mortgage Leads Versus Trigger Leads

I decided it would be a good idea to discuss the benefits and risks of both internet loan leads and trigger leads.  First of all for those that do not know, a trigger lead is a lead that is generated when a loan applicant has their credit pulled.  The credit report company sells the lead to a mortgage company that meets those credit filters.  The big problem for the mortgage company buying the trigger lead is that the loan applicant does not know who they are and usually they are not happy with some random company calling them without their consent.  Any way you cut it, loan applicants are blind-sided by the mortgage company who bought the trigger lead.  It is pretty shocking that trigger leads are legal.  I don’t see how it is any different than buying a spam email lead.  Both trigger and spam leads are generated in some part without the loan applicant’s authorization. 

On the other hand, internet mortgage leads are initiated by the loan applicant. Think about it — the borrower goes online and searches for mortgage companies to help them with a refinance or purchase mortgage.  Once the loan applicant submits their request to be connected to multiple lenders the internet mortgage lead is created.  The loan applicant is now expecting a phone call and email from the loan company who purchased the mortgage lead online. 

Trigger leads can be effective, but they require a very clever loan officer to get good results.  Most loan officers are not able to overcome the typical objections that come with the trigger leads.  It is much more likely to get better conversions with internet mortgage leads because the borrower is expecting your call.  Lead Planet is a direct mortgage lead company offers quality internet and live transfer mortgage leads.  We do not offer trigger leads.

Online Mortgage Lead Committment

The importance of buying quality mortgage leads that convert cannot be understated.  The days of throwing money at any lead broker online and succeeding are gone.  In fact if you do waste your mortgage marketing dollars like that you will not be in business for long.  If you are a loan officer or mortgage broker there is no getting around that these are tough times for the mortgage industry.  The reality is that the home loan products available carry much tighter guidelines than we have seen in the last twenty years. That means if you are serious about being competitive, you need to buy mortgage leads from a lead generation company that can perform day in and day out.

Shopping online for the best mortgage lender to meet your borrower’s needs is indeed a challenge and that is why the Lead Planet has partnered with experienced mortgage companies that know how to close loans in this market.  If you have purchased 1000′s of leads two in ten will likely convert.  One in twenty is pretty standard these days with most lead companies. The Lead Planet has made a commitment to helping loan companies get better conversion ratios from their online mortgage leads. 

Mortgage lead buying is all about commitment and buying large quantities to get a return.  Buying 100 quality mortgage refinance leads could cost $2,500.00 (100 x 25.00 per lead). If you only get applications on 20% of the leads and close half of those loan prospects you are getting a worthy return on your investment. The key is to set your monthly budget for two to three months at a time. Stick to it and buy all the loan leads you can afford if you have a talented staff and lenders that are ready to fund your loan submissions. One of the most common mistakes companies do is to not buy enough leads or stop the online mortgage lead campaign too quickly.  We are proud of the fact that our clients tell us that our live transfer leads convert better than their other lead companies.