Thursday, February 21, 2008

Mortgage Companies Still Upbeat!

You're probably saying NO WAY! How can mortgage companies possibly be upbeat with the subprime fiasco and the demise of so many mortgage lenders?

Well, according to yesterday's New York Times article entitled, No Lull in Mortgage Pitches, these companies are continuing to pump out upbeat messages to encourage consumers to continue to pursue the American Dream of homeownership. Countrywide's ad, for example, touts that "Countrywide can show you the way home." Bank of America's ad: "Homeownership is the best medicine." In addition, the article reports that "the National Association of Realtors is running national television ads saying there has never been a better time to buy a home. Home values nearly double every 10 years, the commercial claims, showing a young couple walk up to their white colonial-style home."

For direct marketers like us who have spent the last few years serving this industry with targeted multi-channel marketing campaigns, this is music to our ears. Companies like CountryWide, Bank of America and Wachovia have not decreased their advertisements -- and we're hoping that increases in direct marketing budgets will follow suit . . . if it's true.

As mortgage experts predict a strong Spring for home buying, other experts are not so sure. “'There’s been huge scrutiny on these companies, but they are continuing to advertise,' said Sally Greenberg, executive director of the National Consumers League, a nonprofit organization in Washington. 'Many of these companies are bleeding, and these ads are a way to get more money into the door.'” Even the Mortgage Bankers Association is not predicting a strong year, according to the article.

It'll be interesting to see how this unfolds. The other outstanding factor is the fact that this is an election year. Both major political parties have made the mortgage crisis a major theme of their campaigns -- with a myriad of approaches for bailing out those Americans who got in over their heads in the past few years.

From this direct marketers optomistic perspective, I'm hoping that the economy will continue to correct itself, and that consumers have better learned to read carefully over the fine print on those mortgage loan documents. If the National Realtors Association is correct in their research, and home prices do nearly double each decade, perhaps this will help to spur the economy in the right direction and get the direct marketing dollars flowing again in this industry! We're keeping our fingers crossed.

4 comments:

Ted Grigg said...

I have a friend who is a direct marketer at Countrywide. They are going full bore ahead.

We are having lunch today as we do every Saturday to see why this is.

I suspect as you do that it has to do with bleeding.

Builders still need to build and lenders still need to lend. Otherwise, they are just out of business.

Nancy Arter said...

I agree. If you have any good insights to share after your lunch with your buddy, we're all ears and would love to hear your comments.

Thanks for your comment!

Richard said...

Great post Nancy,

I have learned many useful resources from your blog. Thanks for sharing this info and hope to read more from you. :)

LiveMortgageFree

Nancy Arter said...

Thanks Richard, I appreciate your comments and am glad you are enjoying our posts! :)