Inman released the top-line findings from a new study entitled, “What Real Estate Brokers and Agents Want From Lenders,” that examines why real estate professionals choose to recommend a particular lender, what kinds of lenders they prefer and what behavior puts a lender in the penalty box. The study also explores the ineffectiveness of lender marketing, the chilling effect that RESPA is having on broker/lender relationships and their early opinions on big bank “listing” apps.
Commissioned by Inman, the survey was conducted by 1000watt, a real estate brand, marketing and strategy firm, in April. Respondents were mostly real estate agents (74%), but 26% of respondents identified as real estate brokers. More than half of respondents (60%) were independent and unaffiliated with a particular real estate franchise. The remaining 40% were affiliated with top firms. In addition to the survey, individual phone interviews were conducted with real estate brokerage executives running companies with more than 500 agents.
Here are some of the highlights:
The Who’s and Why’s of Relationships
>> Nearly half of the Realtors surveyed said they prefer working with mortgage brokers over banks and non-banks.
>> Cultural fit and breadth of products are the number one and two reasons for selecting a mortgage partner.
>> Agents are mainly monogamous: 77% say they have one lender who they refer most often to clients.
>> Speed and responsiveness are the most important considerations to refer a lender.
Leads are not a two-way street: 79% aren’t getting leads from their lenders, but 74% would like them—from lenders they know and trust.
Lender Marketing: Does It Work or Not?
>> The largest percentage of respondents was unsure as to whether lender marketing was effective.
>> More than 35% felt marketing wasn’t effective in building relationships with agents; less than 30% felt it was.
>> Operations with in-house lenders believed that on-site presence was the most effective way to increase capture rates; followed by technology and training; less than 10% of respondents felt print or email marketing was effective.
Tying the Knot or Not?
>> Only 24% of brokers have Marketing Service Agreements (MSAs) with lenders.
>> Only 2% of brokers have Affiliated Business Arrangements (ABAs) with lenders.
>> 42% are now reluctant to enter into MSAs and/or partnerships with lenders due to RESPA concerns.
The Impact of Internet and Mobile Apps
>> Increasingly, clients are doing their shopping for a lender on the Internet and don’t need a recommendation from their Realtor.
>> Big bank efforts to promote mobile apps, like Chase’s MyNewHome or Nationstar Mortgage’s HomeSearch.com get mixed reviews as 38% were very uncomfortable with them, and 30% were somewhat uncomfortable with these proprietary mobile apps.
“Real estate agents wield an enormous amount of influence in purchase transactions, and so they are a critically important audience and referral source to lenders,” said Brad Inman, publisher and owner of Inman. “But, as this research shows, there’s a wide gap between ‘wanting a relationship’ with agents and brokers and building a successful one. Hopefully, this study will help lenders ‘crack the code’ to develop more effective partnerships.”
The complete study is available to Inman Select members at Inman.com/mortgagereport.
About The Author
Tony Garritano is chairman and founder at PROGRESS in Lending Association. As a speaker Tony has worked hard to inform executives about how technology should be a tool used to further business objectives. For over 10 years he has worked as a journalist, researcher and speaker in the mortgage technology space. Starting this association was the next step for someone like Tony, who has dedicated his career to providing mortgage executives with the information needed to make informed technology decisions. He can be reached via e-mail at email@example.com.