With property values rising, home equity lines of credit are gaining popularity among consumers – and this presents a big opportunity for banks, credit unions and other mortgage lenders. How can you take advantage of the HELOC surge?

According to a recent Bloomberg News article, “Home Equity Loans Surge as Rates Fall to Lowest Since 2008,” home equity lines of credit (HELOCs) have increased by 21% in the year ending June 2014, rising to levels not seen since 2009. And the biggest banks are jumping on board. Bank of America, the largest HELOC provider, increased its volume of the loans by 75 percent to $4.6 billion in the first six months of this year from a year earlier. JPMorgan Chase, the third-biggest HELOC originator, had a 45 percent increase in home equity loans in the first six months of the year.

To take advantage of this opportunity for growth, the best approach is to segment your strategy across 3 potential markets:

• your existing HELOC customers whose loans are due to expire soon and need to be replaced with a new loan (aka HELOC resets)
• your existing mortgage loan customers who do not yet have a HELOC
• new customers that you can market to and win to grow your market share

Of these three markets, HELOC resets represent the “low hanging fruit” because these customers need to take action at some point, and now is the perfect opportunity to reach out to them with options. The challenge with HELOC reset loans is that you may have thousands (or hundreds of thousands) of them, and new regulations require that each expiring HELOC be treated as a new loan. This means going through the entire loan origination, property valuation and closing process across a huge volume of loans. For the largest lenders, these loans represent millions of dollars of assets, so procrastinating will only put your business as risk.  Better to tackle them now and seize the opportunity to retain your best customers, especially as your competitors ramp up their home equity marketing efforts.

To help you accelerate and streamline the process of managing HELOC resets, consider going with a solution provider who specializes in this process. The investment will save you time and money in the long-run, and potentially help you retain your best customers before your competitors snatch them away (which is priceless). In addition, partnering with a firm to help you assess, organize and re-appraise the properties tied to these loans will ensure that compliance is built in to the process. Finally, the time you gain back can be applied to marketing within your existing customer base, providing exceptional customer service and engaging in business development efforts to win new clients – all of which contribute to growth and profitability.

Accurate Group has developed a turnkey solution designed specifically to help banks and lenders address HELOC resets in an efficient, effective and compliant manner. Accurate EquityRenew combines technology, processes and data analysis to quickly and thoroughly evaluate each HELOC, identify red flags related to title and property liens and issue an accurate and compliant appraisal on each property. As the lender, you are provided with a report and online dashboard that scores each loan so that you can focus your efforts on the highest priorities and take the appropriate action needed for each HELOC.

Here are 3 resources to get you started:

• An eBook exploring some of the challenges and opportunities that HELOC resets present
• An infographic outlining how the Accurate EquityRenew solution works and the value you gain
• An overview of the Accurate EquityRenew solution

After you’ve explored these resources, please contact us to discuss your specific needs. As the leading home equity appraisal, title and compliance company nationwide, Accurate Group is uniquely positioned to help your firm tackle this opportunity. We have proven technology, processes and experts in place, so you can be confident in handing off HELOC assessments to us – and you can stay focused on client service and growing your business.

 

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