Tim Nguyen of BeSmartee: Customer for Life–Think Beyond Customer Service

Tim Nguyen is CEO & Co-Founder at BeSmartee, a digital mortgage platform empowering mortgage lenders to take their consumers from application to a paid appraisal in minutes. He previously co-founded and led InHouse, a nationwide provider of lender services and technology, from startup to 150+ FTEs before exiting in 2014. He comes from an entrepreneurial background, having taught himself to code and launching multiple websites in high school and college. He eventually found his career in the mortgage industry, where he started InHouse.

Google “customer for life” and you’ll find countless articles around this topic, with most providing advice with familiar phrases such as, “the customer is always right”, “under promise, over deliver”, and “deliver an amazing customer experience”.

Give ChatGPT a try and it says, “…is a phrase that is used to describe a customer who is loyal to a particular company or brand and continues to do business with them for an extended period of time…”.

Neither are wrong. If you provide a quality product or service, and you provide an excellent experience, you can rightfully expect that those happy customers are more likely to come back to you and your brand.

But why then do only 1 out of 5 borrowers go back to their original lender?

The answer is that borrowers have no emotional attachment to their lender. It’s simply a transaction. For a homebuyer, the emotion is reserved for their new home and Realtor who, according to Realtor.com, drove them to ~10 properties over ~10 weeks. A mortgage is simply a means to an end.

Great customer service is a must, and there’s a lot of information on the topic, so I won’t bore you with that. Today, we’ll redefine what “for life” means in a new way, and in particular focus on the mortgage technology stack that follows your borrower each month for years, and that which will maximize your opportunity to serve again and overcome that 1 in 5 statistic.

Everything starts in the mind. Stop thinking you are a mortgage company. You are a homeownership company. You help people get into homes, and you help people stay in their homes. In other words, we’ll break down the “customer for life” journey into two distinct buckets: Origination and Homeownership.

Origination

Website and Engagement Tools

Obviously you have a website that borrowers may visit and that may be measured using simple free tools such as Google Analytics and Google Tag Manager, and paid tools such as business analytic tools such as Mixpanel. Then, there are tools embedded in your website, such as a contact us form, mortgage calculators, mortgage rate search, loan officer pages and mortgage content. All of the aforementioned tools are created to help your potential borrowers engage on their own terms, find value in it, and persuade your borrower to engage with your brand.

Point of Sale

Once a potential borrower decides your brand is worth their time, some will fill out that nifty contact us form where your loan officer will call the borrower back (or the borrower will pick up the phone and call you directly). In either case, a successful outcome is a borrower and loan officer engaged in personal conversation where rapport is built, questions are answered, and if all goes well, an application is completed.

Likewise, if you are like many lenders, you may have an apply now button, where a borrower may directly apply with you 24/7. In any case, the same outcome is achieved in that an application has been taken.

Deeper Point of Sale

Regardless of how you take in an application (loan officer app, or borrower app), consumers today expect more than just an online 1003 that eventually leads to traditional phone and email. Borrowers expect the point-of-sale to provide information throughout the life of the loan, as well as allowing for easier decisions and actions, such as a loan options comparison, instantaneous approval letters that may be modified, the locking a rate/point combination, or the ability to securely upload documents.

Note that I’m not advocating for a fully self-serve process. While the technology is available today and some lenders have seen it happen, it certainly is not the norm. For the foreseeable future, the vast majority of borrowers want a convenient hybrid option. In short, borrowers want technology to make their lives easier, but they also want professional expertise when they need it.

We could deep-dive into the various technologies that matter in the point-of-sale, such as automated credit, pre-population of data, VOA, VOIE, product and pricing, fee aggregation, automated underwriting, letter generation, lights-out disclosures, rate/point locking and more, but we’ll save that conversation for another day.

Processing, Underwriting and Closing

It’s no secret that borrowers don’t expect the mortgage process to be easy. Borrowers are pleased if the process is at least organized, accurate and secure. There are some common ground rules we all know, such as: only provide the absolute minimum list of loan conditions, don’t ask borrowers to upload the same document twice, and don’t ask a consumer to send documents with personal information via email. A violation of these ground rules will deteriorate trust, and once trust is lost, you either lose the deal right then and there, or you’ll never get a second chance to serve again.

These steps in the process are starting to be enhanced and streamlined with mortgage technologies such as instantaneous and credentialed VOIE, AI driven underwriting and e-closings capabilities. All are necessary, and if implemented correctly, lead to a better experience for the customer, and internal operational efficiencies.

Homeownership

Most lenders mistakenly believe that if they do the above, they’ll have a returning customer for life. Maybe, but not really. Remember that according to data, about 1 in 5 borrowers will come back to the original lender they got their original loan with. Let that sink in again.. 80% of your borrowers will never come back to you.

You need to provide value and emotional attachment post-close. For your borrower, their journey has just begun, and so your real work starts now.

Zero Thirtieth

While the customer may spend 1-12 months with your brand, they’ll spend the rest of their lives being an actual homeowner. This means they’re thinking about making monthly mortgage payments, paying utility bills, not missing tax payments, renewing their homeowners insurance, making repairs, and buying another home that may require a mortgage.

Will they come back to you? As the data shows it, not likely. Which means, you have no brand equity and your cost to originate doesn’t improve and you continue to fight rising costs of advertising.

Life Long Engagement

So then, how do you create a “customer for life” if you’re 0/30th of the actual journey of a homeowner? The answer is complicated, but straightforward…

Give your borrowers a reason to come back to your brand with value and emotion.

But, I’m not talking about personalization, such as happy birthday emails or local neighborhood news. To be clear, I’m not rejecting those tactics. Instead, I’m recommending that you promote homeownership, that you help your borrowers keep their home, that you utilize hyper-personalization.

New technologies, many of which are built on data, analytics and AI, are starting to emerge that will help you create personas from your loan data, and even take it one step further, to apply such data in more useful ways. To this end, your CRM is no longer your engagement “brain” that knows all. Your CRM becomes a communication system like the throat or the limbs of a human body.

Data Is No Longer The Only King

For about two decades now, the belief is that data is king. But, times are changing. In today’s future, data will share the throne with AI. With hyper-personalization your happy birthday emails transform into value and emotion, such as:

• Reminders that your borrower’s recent mortgage transaction has loan costs which may be tax deductible. Prompt your borrower to log back into your POS to retrieve the secure document.
• Alerts that rates went down, but that it’s not yet low enough to be meaningful to your borrower, that you’re monitoring it and will let them know when it’s time to log back into the POS and start a new application.
• Warnings that the original appraisal report stated that the roof has about three years of remaining life, and that it’s probably a good idea to have someone take a look at it in preparation. Push local rated professionals to your borrower.

Hyper-personalization is relatively new, having emerged in the early 2010’s, so don’t feel like you’re too far behind, because you’re not, at least not in mortgage. Newer and more affordable technologies are getting better by the day. The best thing you can do is build the platform and stay with your borrower for life, and steadily seek to add hyper-personalization over the life of homeownership.

Servicing

Note that I made servicing a subsection of Homeownership. The reason for this is that there is no relationship with the servicer. Despite most borrowers making payments monthly, servicing is a one-directional relationship that, in the borrower’s eyes, gives nothing back in return each month.

That said, if you’re the lender and servicer, or at least retain sub-servicing rights, your brand will live with your borrower for the life of the loan. This is helpful and if you monitor your servicing portfolio well, will give you a slight edge in new origination opportunities. But sadly, that in itself isn’t enough. Servicing is a function that needs to be wrapped around by value and emotion, i.e. reasons to anticipate your next engagement.

POS Is For Life

Therefore, servicing should be built into the same platform where your borrower applied for and closed their loan, i.e. the POS. Here, we envision a world where the POS is not a place to simply close a mortgage, but a place where a consumer can live for the life of their loan.

It’s a place where borrowers want to go back to to check on how their principal balance is being paid off. It’s a place where borrowers want to go back to to retrieve their closing disclosures, and hence the loan costs they may be able to write off. It’s a place where borrowers can edit their property tax reminder to fire off 60 days ahead of the due date, and not 30 days. It’s a place where borrowers can log in to see a list of recent home sales and new listings.

It’s a place where your borrower may likely decide to apply with your brand again.

Go beyond Origination and look towards Homeownership. Look at “customer for life” not in terms of the 0/30th, but a relationship that spans the entire 30.

(Views expressed in this article do not necessarily reflect policy of the Mortgage Bankers Association, nor do they connote an MBA endorsement of a specific company, product or service. MBA NewsLink welcomes your submissions. Inquiries can be sent to Mike Sorohan, editor, at msorohan@mba.org; or Michael Tucker, editorial manager, at mtucker@mba.org.)