Business Building Center

A Case for the Financial Go Bag

Vetted VA is an online community where Veterans can ask real estate and mortgage questions and receive answers from a network of Vetted Financial Professionals without being solicited. Vetted VA founder, Christopher Griffith was seeking additional financial tools to assist Veterans in achieving their financial goals.
FinLocker was identified as a partner to deliver Veterans with new financial health and wellness tools with its custom-branded financial super-app that focuses on all aspects of the homeownership journey. In March 2020, Vetted VA partnered with FinLocker to deploy the Vetted VA Go Bag, the financial planning and monitoring tool for Veterans.

The Challenge

Veterans have lacked a comprehensive financial preparedness solution, especially one focused on real estate finance. This is made painfully clear once many leave active service and are no longer supported, instead they are seen as a specialized market that are easy to target and solicit. This solicitation tends to prey on their status as a Veteran by offering specialized services and programs which do not actually provide anything of lasting financial value to the Veteran. The common issue is a lack of understanding and transparency throughout.

“Prior proper planning prevents piss-poor performance,” says Christopher Griffith, Marine Veteran and Founder of Vetted VA. “Both active duty and discharged Veterans understand this saying. With debt specifically, those who cannot plan for the debt they will accrue end up only saving a little money and relying on hope. This isn’t the military way – yet it has been the standard until now.”

The Solution

The Vetted VA Go Bag powered by FinLocker is a secure app where Veterans can safely store their financial data from other financial institutions. The app is built around the concept of consumer-permissioned data, so no financial institution will ever see a Veteran’s financial records until they give permission and share with a specific Vetted Professional. The Veteran has full control of what they store in the Vetted VA Go Bag, who they share the information with, and for what purpose. The Vetted VA Go Bag puts Veterans in control of their financial information.

  • The custom branded financial super-app provides Veterans with tools that include:
  • Credit report, credit score, credit monitoring, and alerts
  • Financial tools that enable spending analysis, budgeting, goal setting, and tracking
  • Access to an extensive library of homeownership and finance education
  • Ability to track value and equity of currently owned real estate
  • Search for properties for sale across the U.S.
  • Uploading financial documents they will need when they are ready to proceed with their real estate transaction
  • Direct connection to the Vetted VA Professionals network for financial advice

Partnering this tool with professional oversight and counseling from Vetted VA Professionals means the Veteran is not only prepared before the conversation, but they have a safe and secure place to take action based on the consultation and, when ready, can take action to share their documents to the Vetted Professional to move the process forward.

Vetted VA focuses on keeping the Veteran in control of their financial future by providing freedom from solicitation, liberty of knowledge from trusted sources, and accountability to deliver what is promised through vetting. FinLocker has fulfilled its part of that vision by supporting the liberty and accountability of information.

5 Ways To Fill Your Pipeline With Millennial Homebuyers

At the conclusion of 2019, prior to the Coronavirus changing the way we live and work, Millennials – those born between 1981 and 1996 (turning 25 to 40 in 2021) – had a 47%1 share of primary home loan originations of the market.

As 2020 progressed, and office workers began working from home, with many arrangements now becoming permanent, Millennials seized on the opportunity provided by low rates to stop renting in expensive cities and purchase a home in an affordable suburban neighborhood or small town.5 This change has seen the year ending with Millennials now making over 60% of the home purchases.2

In 2021, a significant wave of millennials will be 30-353, the prime homebuying age for first-time buyers. How do you fill your pipeline with Millennial homebuyers and position yourself to capture their repeat business and referrals? Here is what we know about this group of homebuyers and how a custom-branded FinLocker can turn loan originators into trusted advisors with customers for life.

1 – Millennials are struggling to save for a down payment.

Student loans, car loans, credit card debt, and increasing rents make it difficult for most homebuyers to save for a down payment. Debt delays 75% of buyers aged 22 to 29 from saving for a down payment or buying a home for 1-3 years, and 48% of buyers aged 30 to 39 years are delayed 5 or more years.4 Yet for 85% of buyers aged 22 to 29 and 72% of buyers aged 30 to 39, their savings is the primary source for their down payment.4 To become a homeowner, Millennials first need to learn to manage their debt and start saving.

How FinLocker can help Millennials save for their down payment:

The FinLocker financial super-app provides practical budgeting and saving tools to keep Millennial homebuyers focused on their homeownership journey. Whenever there’s a change to their credit score, they keep their budgets on track (or get off track), and make progress towards achieving their savings goals, users will receive a notification through the FinLocker mobile app.

2 – Millennials are burdened by student debt.

According to the National Association of Realtors, 76% of consumers claim student debt impacts their ability to purchase a home5; 38% of homebuyers aged 30 to 39 years have student debt with a median amount of $34,000.4

Student debt often affects a homebuyer’s debt-to-income ratio, contributing to a low credit score. These two factors were cited by 55% of buyers aged 22 to 29, and 67% of buyers aged 30 to 39 as the reason their mortgage application was rejected.4

How FinLocker can help Millennials overcome their student loan debt:

Rather than turn away over half of your Millennial clients for not being mortgage ready, nurture them with a FinLocker. When your clients enroll their credit and debit accounts, the FinLocker Spending Analysis will categorize each transaction to identify where they can cut back on spending, pay down their student debt and credit cards, and begin to save for their down payment. With regular engagement, FinLocker customers will start to see their credit score improve and their debt-to-income ratio lower.

3 – Millennials are tech-savvy and expect their homebuying vendors to be, too.

Millennials are keenly aware of the convenience of online shopping, digital tools, and apps. They expect the vendors involved in their home buying transaction to provide the same convenience. The first step of most millennial homebuyers as they begin the home buying process is to look online for properties for sale (43%), followed by looking online for information about the home buying process (17%), with few (7%) contacting a bank or mortgage lender first.4

How FinLocker can help you to attract and engage tech-savvy Millennials:

Target your online marketing to Millennial homebuyers who are early in their homebuying process. Promote the offer to give first-time homebuyers a free financial super-app, aka your custom-branded FinLocker, to every new client that gets pre-qualified. Once they are pre-qualified and you’ve identified any impediments to them purchasing a home in the short term, invite your clients to create a FinLocker to interact with the app’s financial tools to correct the barriers you identified.

4 – Millennials need assistance overcoming the most difficult steps of the home buying process.

Millennial homebuyers in 2020 cited “finding the right property,” “paperwork,” “understanding the process and steps,” and “saving for the down payment” as the four most difficult steps of the home buying process. What’s more, 63% of Millennials found the home they purchased on the internet.4 The internet is filled with websites that Millennials can use to obtain homeownership education, but if they stumble across the lead gen resources created by your competition, how likely are they to return to you for their mortgage?

How FinLocker can help Millennials get mortgage ready:

A custom branded FinLocker will help you remain top of mind with your borrowers as they engage with the app to address each step in the home buying process. When they’ve saved their down payment and have taken the readiness assessment, they can begin their Property Search in the app. FinLocker also provides secure Document storage, so the homebuyer can securely transfer their financial documents and assets to their loan officer when they are ready to complete their mortgage application.

5 – Millennials can be a top referral source.

An investment in customer satisfaction is an investment in your company’s future. Satisfied clients are more loyal and will be the promoters of your business. In 2020, 87% of consumers began their lender search with a referral or an existing relationship.6 How will you become the mortgage lender your clients recommend to their homebuying friends and colleagues? Stand apart from the competition by becoming a trusted advisor who provided your Millennial clients with the financial tools to improve their credit score, help them save for their down payment, and ultimately increased their purchasing power.

How FinLocker can help your Millennial homebuyers become customers for life:

Client engagement with your custom-branded FinLocker doesn’t end at the closing table. Homeowners can continue engaging with their FinLocker indefinitely as they save for future home repairs, build an emergency fund, and plan to achieve their next financial goals. As the provider of this useful financial tool, you’ll remain their lending contact, keeping you top-of-mind when they are asked for a referral to their mortgage lender.

To find out how a custom-branded FinLocker can be used to attract more Millennial clients to your loan officers, contact us to schedule a demo.

 

1 Realtor.com, Q4 2019 Generational Propensity Report: Generation Z Enters the Housing Market
2 Ellie Mae, Ellie Mae Millennial Tracker
3 Deloitte Insights, U.S. Census Bureau International Demographics via Haver Analytics
4 National Association of REALTORS®, 2020 NAR Home Buyer and Seller Generational Trends
5 National Association of REALTORS®, The Impact of Financial Literacy on Homeownership: Student Loan Impact
6 STRATMOR Group, How to Become the Mortgage Lending Choice of Millennials

Qualify More Borrowers With a Top of the Funnel Digital Transformation

Digital mortgage applications have almost become an industry tables stakes. While some companies offer a digital solution to get prospects pre-qualified quickly, other companies have expanded beyond the initial loan application to provide an entirely digital mortgage process.

As mortgage lenders try to keep pace with this ever-evolving process and customer expectations, technology advancements have focused on the milestones towards the conclusion of their digital mortgage roadmap.

If delivering a digital mortgage experience is now the expectation of borrowers, particularly younger homebuyers, why aren’t more mortgage lenders offering a user-friendly digital solution at the top of the funnel to get their clients mortgage-ready?

According to a recent Fannie Mae survey1, about 38% of homebuyers did not shop around before selecting their mortgage lender. If a lender can capture these prospects in the early stage of their home buying process and stay top-of-mind, they will likely apply for a mortgage with that company.

Providing a digital solution that empowers borrowers to become mortgage ready at their own pace and can deliver an experience that will ultimately drive repeat business and referrals should be the new focus of every mortgage company’s digital mortgage roadmap.

FinLocker Levels The Playing Field

FinLocker provides independent mortgage originators, community banks, and credit unions with the same opportunity to get their borrowers mortgage ready as the mega banks and online lenders.

Smaller mortgage lenders and financial institutions are less likely to have the technology and marketing resources to nurture prospects through to close and engage with clients post-close to develop a relationship to retain their customers for life.

When a loan officer invites his/her customers to create a custom-branded FinLocker, they are taking the first step to invest in a long-term client relationship. Providing a customer with free financial tools to improve their credit score, help them budget, save for their down payment and closing costs, and reduce their DTI to get mortgage ready, will drive customer loyalty, resulting in higher funnel conversion.

FinLocker saves the lender from remembering to check in with each prospect regularly. When the customer has completed their goals, they can take a Readiness assessment in the app to let them know in a few seconds if they are mortgage ready.

The financial representative who provided the FinLocker invitation is listed as the contact in the customer’s FinLocker, so the customer can initiate a loan application directly from their app when they are confident they will meet the eligibility guidelines for their mortgage.

Be The Lender Your Borrower Wants You To Be

The majority of homebuyers responding to a Fannie Mae survey2 said that “gathering all the financial documentation is the most difficult part of getting a mortgage and that paperwork reduction is critical to making the process easier.” Borrowers who have grown up in a digital world now expect an Amazon-like experience, where their financial activities can be quickly and securely incorporated into subsequent transactions, including their mortgage application.

When a customer uses a FinLocker, they do not need to start from the beginning when applying for a mortgage. With instruction from the FinLocker Documents widget and their loan officer, borrowers can gather in advance loan documents, upload them to their FinLocker, and securely transfer them to their loan officer when they are ready to apply for a mortgage.

Decrease Risk

Manual processes are cumbersome and prone to human error. FinLocker uses consumer-permission data so users can select which assets, liabilities, and documents saved in their FinLocker are transferred directly to the loan officer for inclusion in their loan application. The documents are packaged as Mismo and Fannie Mae 3.2 file formats along with an Asset Report to speed up the loan application process and transfer to the lender’s loan origination system.

Gain Market Share

The average loan production is costing lenders $7,138 per loan in Q2 2020, according to the Mortgage Bankers Association3, so it’s not surprising that mortgage lenders are looking to reduce costs due to market compression and margin squeeze.

The consumer-permissioned data transferred from FinLocker helps lenders process mortgage applications more efficiently. Delivering mortgage-ready borrowers with documents and assets packaged for underwriting helps lenders close purchase loans and refinances quicker and gain market share.

FinLocker gives all mortgage lenders the opportunity to begin a quality customer interaction earlier in the home buying process than other marketing tactics. Issuing a custom-branded FinLocker app keeps the financial institution top-of-mind for the duration of the loan process and initiates a value-added relationship to create a customer for life.

 

1 Fannie Mae, Shopping Around for a Mortgage Pays Off for Consumers

2 Fannie Mae, What To Digitize First, According To Recent Homebuyers

3 Mortgage Bankers Association, IMB Production Profits Soar in Second Quarter of 2020

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