Hispanic Millennial homebuyers are set to be a dominating force in the mortgage industry. However, many loan officers have failed to connect with this crucial demographic, and as a result have missed out on increasing their business volume.
Consider for a moment that according to the 2015 State of Hispanic Homeownership Report Hispanics made up 37 percent of total household formations in 2015. How much of that business did you see? What I have discovered is there are a few key ways loan officers can help Hispanic Millennial homebuyers realize the dream of homeownership.
It’s important before you take action, to understand the demographic you are hoping to assist. In many ways, Hispanic Millennials are not too different than other Millennials. Many still live with their parents, they seek out digital technologies to communicate and find creditworthiness to be a hurdle in homeownership. That said, MGIC has always been interested in understanding the cultural differences that exist within the mortgage marketplace, and how it relates to housing formation. We often do our own research to learn more about how we can best serve these demographics.
Through this research we have determined how to help loan officers connect with Hispanic Millennial homebuyers.
One of the hurdles for Hispanic Millennial homebuyers is lack of access to accurate educational material about homeownership. Consistently we have found that Hispanic Millennials are uniquely keen on educational materials that relate to understanding the homebuying process. In particular, it is important to illustrate the value of the whole process, rather than a single event. Help Hispanic Millennials homebuyers understand every step of the process by providing educational homeownership materials in Spanish and English.
According to Pew Research, three-quarters of Hispanic Millennials are proficient in English, but that doesn’t mean they prefer to digest important information in English. Providing bilingual materials and insight can work to create trust between you and Hispanic Millennial homebuyers. These materials can be used to ensure the borrower clearly understands what is involved in the process of buying a home. It can also serve as a way to help other family members — who may not speak English at all — feel secure with the process. Comprehensive bilingual educational materials are the goal for any Loan Officer who hopes to effectively help Hispanic Millennial homebuyers.
“Don’t sell to Hispanic Millennials, relate to them.”
Family is paramount in the Hispanic culture. In particular it is key with Hispanic Millennials because they often times serve as the go-between with their parents in decision-making situations. They want to protect their family. As a loan officer, it is your job to help them understand the value of a lender. Don’t sell to them, relate to them. Create a path that highlights why it’s important to have their money in the bank. Illustrate the importance of building a solid credit profile, and help them do it properly. Then explain how these actions can assist down the road in achieving the American Dream of homeownership.
Like many demographics, trust is deeply valued in business relations. However, with Hispanic Millennials it is everything. Becoming a trust agent to Hispanic Millennial homebuyers should be a top priority for Loan Officers. Make the concept of homeownership relevant to them; help connect the dots as to how buying a home — as opposed to renting — is going to help build their family’s wealth faster.
As reported in the Hispanic Wealth Project, 86% of Hispanics prefer owning to renting – but more importantly see it as a good place to raise a family. Knowing this, and the value placed on family in the Hispanic culture, a Loan Officer can work to help interested borrowers secure a home through a variety of programs targeted directly at assisting this key demographic. For example, low-down-payment options can provide the assistance needed to help Hispanic Millennials overcome the homeownership hurdle.
Regardless of your marketing approach, loan officers (and lenders) should focus on a few key items to gain the attention of Hispanic Millennial homebuyers. Most importantly: bilingual mobile-friendly websites. 96% of Hispanics currently own a smartphone, and studies show that Hispanic Millennials out-index other demographics and age groups in use of smart-phones, video and music streaming.
“Understand that Hispanic Millennials are different, but don’t treat them differently.”
Play to these stats in both English and Spanish. As a company or individual, consider sharing content on social and digital channels that highlights the value of homeownership in an authentic way. Remember Hispanic Millennials are bicultural and have a unique background and perspective. Work to find ways to celebrate this in marketing materials and content pieces.
Video plays an important role in marketing because the viewer does not need to always understand the language to resonate with the message. Consider positioning your personal brand (or corporate brand) in a way that relates to current issues, situations and values of Hispanic Millennials.
Hispanic Millennials are unique, yet somewhat familiar — they are tech savvy, bilingual and loyal, but are also concerned with creditworthiness, accurate information, seeking down payment assistance and battling limited inventory. The best way for loan officers to help Hispanic Millennial homebuyers is to focus on the process. Taking time to provide bilingual educational materials about the homeownership path will work to better engage and relate to this key demographic. Focus on the whole picture and leverage digital channels to expand your reach. Understand family is paramount in all aspects of life. Keeping a Hispanic Millennials’ best interest at the forefront provides you the opportunity to increase business volume not just from them, but also from their family. Aim to be a trust agent that assists in improving the customer’s life and you will see success.
The opinions and insights expressed in this blog are solely those of its author, Maria Vergara, and do not necessarily represent the views of either Mortgage Guaranty Insurance Corporation or any of its parent, affiliates, or subsidiaries (collectively, “MGIC”). Neither MGIC nor any of its officers, directors, employees or agents makes any representations or warranties of any kind regarding the soundness, reliability, accuracy or completeness of any opinion, insight, recommendation, data, or other information contained in this blog, or its suitability for any intended purpose.