It's a Wonderful Mailer - Lets Close Some ARM Leads
ARM Loan Direct Mail Leads are not difficult to target, there are several databanks with variables in mortgage information that can be accessed. Most ARM loan leads fit the time-frame and interest rates exacted during the mortgage free-for-all just a few years back. These are homeowner borrowers that didn't fit the mold of a traditional mortgage loan applicant. Most did not have the 20% down payment that signals a preparedness for homeownership. Still they gambled on a strong and steady housing market which would allow for a refinance into lower interest rates. In exchange they signed off on prepayment penalities and balloon rates (which incidentally are markers for foreclosure leads if research tells us anything).
The refinance of ARM Loans brings to light the era of the Predatory Lender during which repeatedly seized houses and closing fees enticed profiteers with a whiplash scent and signing of naïvete.
Looking at the 2006-2009 Mortgage Mess with its harsh reality and absent ethics, we wonder what was behind the Trade Off.
Why did we replace the stature and esteem that was the theme of Banks, where trusted entities charged a small and fixed interest sum for services, where the characteristics of borrowers were painstakingly selected to avoid the monetary losses and unpleasantness of foreclosure.
Balloons in Time
Most of our clients know that when we pull ARM loan direct mail leads we go back two to five years to target the date filters that will identify ballooning loans. Using this non expiring ARM loan which is updated often in light of our nations mortgage changes has given our clients the Lead Generation Mailers edge that is required for the economic downturn for the past six years.
Companies that are using Mortgage Mailers to target ARM prospects have plenty of rock solid data filters to go by. The interest rates, LTV, High Risk (600) Credit Scores and Loan Amounts are indicative of an ARM that will likely need refinancing. Should you decide to work with credit scored data there is open access to all of the information kept by the bureaus. Filters like equity, revolving bank card debt, mortgage trade lines, exact credit scores etc are accompanied by dates and included at no extra charge.
As long as there is decent sized geography we can provide highly performing data. Sometimes we recieve calls or website forms seeking (for example) a direct mail marketing order with a fair amount of filters within a few zip codes. In this situation we need to expand the work area to compensate for lost records and aspects of incomplete reporting. By experience we know that its pointless to think that a rigorous list can be produced when data is limited by the pairing of small geography and numerous filters.
Serving Targeted Mortgage Mail with Balloon Points
Adjustable rate (ARM) Mailers are targeted as mortgages with variable interest rates. These are borrowers that were put in place with lower interest rates and monthly payments, a nice situation that any of us could get used to. The lower rates only timing out when they became eligible for larger loans. Anyone in an ARM that planned to stay-put for several years were (if I may borrow a coin) :"Living the life of Riley". But in our housing market the initial period ended for many many ARM borrowers at the same time; on a national level this created a crisis and on an individual level it came as payment shock in the form of:
- Negative Amortization - payment caps stop borrowers from paying monthly interest, in time the unpaid interest is added back to the balance making it much larger than was borrowed
- Prepayment Penalties - measure taken when ARMS's are sold, paid off or refinanced in an effort to avoid interest rate increases
- Conversion Fees - Fines charged if the ARM moves to a fixed rate
Economic indices such as Constant Maturity Treasury (CMT), Cost of Funds Index (COFI), and London Interbank Offered Rate (LIBOR) are the influence over ARM interest rates. Increases or decreases in indices produce a corresponding rise or fall in interest rates. Monthly payments are then adjusted accordingly
- Fully Indexed Rate: The fully indexed rate or the total interest rate is a sum of the margin and index
- Index: A guide used by lenders to compute interest rates. changes in indices affect the interest rate
- Margin: An interest rate, expressed in percentage, which represents the lender’s gross earnings on the loan. It includes the cost of doing business and the profit gained during the transaction
- Adjustment period: The interval between potential interest rate changes
- Rate Caps: Regulators of interest rate increases. There are two types of rate caps: periodic and overall. Periodic caps limit interest rate increases between adjustment periods. Overall caps limit interest rate increases during the entire period covered by the loan
- Payment Caps: Regulators of monthly payment increases
Adjustable rates allow both the lender and the borrower to share in the interest rate risk. Having adjustable rates can go both ways. In one way they can luck-out with lower interest rates, in another way they can lose-out when interest rates rise, Likewise payment caps may work either for or against. On one hand preventing excessive increases in monthly payments; and the other predisposing the borrower to negative amortization. It's a "Game of Chance" and it's responsible for the over priced mortgages of borrowers on loss mitigation leads lists in every city.
We want our clients to make money it's why we all do what we do. Call or drop us an email with your questions or requests from exclusive specialty lists to arm loan direct mail leads. Let us search out your most productive data. Our best feedback goes with our most regular re-order clients using Credit Scored Data we can start exploring data options for your criteria and offer during a free 15 minute consultation where we can run queries and provide ideas for your homeowners direct mail ca mpaign.
Remember... We can turn your companies mailers around quickly (2-3 days)
