Creatively market HELOCs to generate high borrower volume and acceptance.
Home equity line of credit loans (HELOCs) have been popular for years for good reasons. HELOCs offer easy approval loans to help homeowners perform home improvements, pay medical bills, meet tuition deadlines and generate funds for other investments or real estate purchases. These loans are just as attractive to lenders as they are to homeowners. A highly competitive product, HELOCs demand that lenders such as banks, credit unions, and private lenders use both classic and inventive marketing ideas to generate borrowers and capture good market share.
Home Improvement Ideas
Using print, radio, TV, direct mail and in-house digital media such as lobby and branch signage and video, HELOC lenders stress the benefits of the product. For example, lenders tailor marketing promotions to calendars. Spring HELOC promotions often feature adding sunrooms, decks, Florida rooms, central air conditioning or other needed repairs and improvements. These promotions paint a picture of the "dream", failing to emphasize rates or terms.
Low Closing Cost and Fast Approvals
A classic and typically effective HELOC promotion emphasizes special closing cost offers and the blazing speed of approval and closing. Promoting interest rates close to "prime", three- to five-day approvals and low (or no) closing costs usually entices borrowers and generates new applications. Most lenders use these promotions when aggressively seeking higher loan volume. While enthusiastically welcomed by borrowers, these promotions sometimes concern lenders because of lower profitability. Yet, these promotions are usually effective.
Advertorials
Relatively new in the world of HELOC marketing, advertorials can be very successful promotions. An advertorial is a combination of advertisement and editorial copy. These are particularly effective in print media format, using newspapers, magazines and the Internet. By structuring an advertisement to mirror an article, lenders can use this strategy to enhance all specific product promotions. For example, a late summer/early fall HELOC promotion encouraging tuition funds borrowing might feature an advertorial that discusses sources of education financing, including federal student loans, Pell grants and HELOCs.
Direct and Targeted HELOC Marketing
Direct and targeted marketing is often both cost-effective and highly successful. Market HELOCs only to those who may be interested, qualified customers. Building or buying mailing lists containing only data regarding those people who are homeowners, in income ranges that should support second mortgage payments and are in age categories that statistically make home improvements, have education expenses or are active investors can help direct advertising dollars only to those prospects who are likely to be qualified customers. Unlike radio or TV promotions, lenders using this idea only reach those who may immediately become buyers (borrowers).
Tags: HELOC promotion, home improvements, only those, qualified customers, these promotions