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Got Loans? Credit Based Marketing

By on January 22nd, 2014 in Marketing

Credit Based Marketing allows you to monitor current account holders and acquire and retain profitable ones. And since it is credit based, you determine what qualifications, (FICO scores, etc.) the prospects require to meet the goals of your financial institution.

Video Webinar

In today’s Webinar Wednesday episode, our Vice-President of Sales John Dudek provides insight on credit-based marketing, and how utilizing data from the 3 credit bureaus can help financial institutions identify and acquire new loans.

Video Transcript (Highlights)

Are You Aware of Losing Loans?

  • On Average 5% of your Members are Looking for an Auto, Mortgage, HELOC, or Credit Card Loan Every Month!
  • Competition is More Fierce than Ever.
  • Gain the Knowledge and Ability to Close Loans From Members When they are Looking to Close.
  • Make the Right Offer at Just the Right Time!
  • LKCS Can Assist You in These Needs.

Credit Bureau Data

Purchasing actual data from the Credit Bureaus to which LKCS has relationships with. These relationships enable us to provide data from any or all of the three major bureaus.

  • Not all bureaus have information on all people – it is important to source data from multiple bureaus.
  • Up to 70% increase in leads when pulling data from three bureaus as opposed to one.
  • No additional cost to obtain data from multiple bureaus.

Data Aggregation Overview

LKCS multi-sources credit and non-credit data creating a very unique compilation of data. We are financial services-centric and offer significant incremental advantages.

Data Available from All Three Bureaus

Select which of the credit bureau(s) you want to receive data from as the first choice.

  • Even though you may prefer to work with one bureau in particular, account holders may be shopping with a company that uses a different bureau # of Inquiries.
  • Benefit from incremental lift by adding additional bureaus.

Credit Prospecting vs. Credit Alerting

  • Credit Prospecting
    • Use credit data PROACTIVELY.
    • Market to prospects or existing account holders with specific demographic and/or credit-based traits.
  • Credit Alerting
    • Use credit data REACTIVELY.
    • Market to prospects or existing account holders actively seeking a loan elsewhere.

Using Credit Data

Specify Your Lending Guidelines:
– Only market to prospects and account holders meeting your specific credit criteria (ie – FICO Score, LTV, Credit History, etc.).
– Credit data can only be used when you are extending credit offers.
– Must be compliant with the Fair Credit Reporting Act.

Firm Offers of Credit

When using Credit Bureau data, marketing materials must include:

  • Indications that the recipient is pre-selected, prescreened, or pre-approved.
  • Terms and conditions; eligibility requirements.
  • Minimum dollar amount for which the recipient has been qualified.
  • Opt-out notice and disclosure.

Credit-Based Loyalty Programs

  • React with the RIGHT offer at the RIGHT time.
  • Gain the ability to reach account holders who may be defecting to your competition in near real time.
  • Based on actual credit bureau data.
  • Deliver a firm offer of credit to cross-sell additional products at the moment a need has been identified.

Credit-Based Alerts

Here’s What Happens… When your account holder applies for credit ANYWHERE, an inquiry is posted to his or her credit file, these inquiries are categorized according to the type of financial product the account holder is seeking: mortgage, auto loan, installment loan, credit card or insurance. Your account holder database is cross-referenced DAILY with these inquiries and a “lead” is generated each time there is a match with the credit file.

Respond with a firm offer of credit or insurance immediately after receiving the lead.

  • Select which category(ies) of inquiry(ies) you wish to target.
  • Leads are then pre-screened using your qualification criteria.Criteria can be based on numerous attributes including credit score, debt load, etc.
  • Daily alerts from Equifax, TransUnion and Experian! LKCS provides you with a list of all leads and fulfills any direct mail and/or e-mail offers on the same day.

DataFlex Credit Alerting

We provide credit-based activity alerts from ALL THREE major credit bureaus.

  • Close loans that would have gone to other lenders by comparing credit bureau activity each day!
  • Monitor and identify your account holders DAILY for auto loan, mortgage, consumer loan and/or credit card inquiries.
  • Set criteria to identify prospects that will qualify for a loan offer based on your specific pre-screen requirements.
  • Send direct mail, e-mail and/or statement onserts to contacts whose credit has been checked and meet your prescreen criteria.
  • Provide outbound call lists for your call center to contact these account holders.

Credit Prospecting

  • Available for any pre-screen marketing campaigns.
    • Auto Loans
    • Mortgages
    • HELOCs
    • Auto and Mortgage Refinancing
    • Credit Cards
  • Pre-screen your existing account holders or reach out to credit-qualified prospects in your area(s).

Credit Prospecting Campaigns

Extend pre-approved offers of credit to account holders and non-account holders based on actual credit score information.

  • Set criteria to identify recipients that will qualify for a loan offer based on your specific pre-screen requirements.
  • Send direct mail loan offers, e-mail offers, statementbased campaigns and make outbound phone calls to qualified account holder and non-account holder prospects.
  • And you can utilize our DataFlex reporting engine to measure the results of these campaigns!

DataFlex Document Solutions Reporting

  • DataFlex is an Advanced Financial Marketing, Reporting and Tracking System.
  • Use the power of DataFlex reports to measure the results of your pre-screen and credit alerting efforts.
  • LKCS will incorporate any credit based data you utilize into DataFlex to track individual campaign results.
  • Use DataFlex to Identify Cross-Sell Opportunities from your Core Processing System with ease.

Potential Credit Prospecting Campaigns

  • Leverage credit data to generate loans.
  • Be creative – brainstorm campaigns that make sense for your institution.
  • Adjust the credit parameters, etc. as needed to fit your lending guidelines and goals.

Potential Campaigns

  • Lease Expirations
    • Fico Scores 640+
    • Exclude auto lates/repo’s
    • 1-3 months left on their lease
  • Loan Payoff
    • Fico Scores 640+
    • Exclude auto lates/repo’s
    • Loan Balance is greater than $5,000
    • Minimum $XX savings on monthly payment
  • Home Equity Refi (1st position)
    • Fico Scores 680-720 (or to 750 if possible)
    • Mortgage balance below $150K
    • Less than 50% LTV
    • No 30-day lates in last 12 months
  • Conventional
    • Fico Scores 680-720 (or to 750 if possible)
    • Mortgage Balance $100K+
    • No FHA/VA/reverse mortgages
    • Age of loan 13-72 months
    • Up to 95% LTV (higher LTV’s will respond)

Sample Campaign Offer: First Time Home Buyers

  • Sent to Renters
  • Qualified by FICO Score and other credit parameters
  • Sent to Homeowner’s
  • Available equity over $xx,000
  • Revolving debt over $xx,000
  • Qualified by FICO Score and other credit parameters – Sent to Homeowner’s without YOUR Home Equity Loan/LOC
  • Available equity over $xx,000
  • Qualified by FICO Score and other credit parameters

What’s the Cost?

  • Credit Prospecting – Pricing depends on several factors including:
  • Number of records purchased
  • Demographic selects purchased
  • Credit bureau minimum charges – FREE List Counts and Estimates
  • LKCS will run counts at no charge to determine feasibility and cost of your next pre-screen marketing campaign.
  • Credit Alerting – Based on number of account holders and/or prospects screened each month – FREE Opportunity Analysis
  • We will review your account holder credit activity over the past 30 days and provide you with the following data: credit activity by inquiry type, state and credit bureau, as well as qualification rates using your specific qualification criteria!

Credit Alerting Case Study Results

  • Average Loan Size of $150,000
  • Front-end and back-end revenue of 2.5%-3.0%