Magazine article American Banker

Competition Is Making Home Equity Marketing a Year-Round Business

Magazine article American Banker

Competition Is Making Home Equity Marketing a Year-Round Business

Article excerpt

The marketing of home equity loans and lines of credit is no longer a spring and fall affair.

Rather, banks are increasingly running their marketing campaigns beyond the traditional seasons for home equity lending, say banking professionals and consultants.

The change highlights the increasing competition for home equity loans and the shifting uses of second mortgages by borrowers.

"Seasonality is blurring," said James D. Monteleone, president, Leadsource Inc., a Pittsburgh marketing consultancy. "It is becoming less of an issue."

What that means for banks are longer - and more expensive - marketing campaigns.

Mr. Monteleone explained that borrowers are no longer looking for cash only during the spring, when home improvements are taken on, and in the fall, when school tuition bills put a strain on family budgets. That also has a lot to do with the new ways borrowers are using the loans, he said.

"I don't think it is to be strictly interpreted as a loan for home improvement anymore," added Linda Waldman, president of Waldman & Associates, a Chicago advertising and marketing firm.

Home equity lending continues to be an aggressively marketed product, said Patrick H. Seroka, president, Seroka & Associates, Brookfield, Wis.

"It is one of the most competitive things out there in the banking industry," he said. "Today, I see it as one of the two or three most competitive products in financial services."

He said most banks look at home equity loans as a first step to cross- selling other products. …

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