It’s that time of year when the leaves turn color, the air gets brisk and when new Home Mortgage Disclosure Act (HMDA) data is released! Though critically important data for all lending institutions, the HMDA data is seldom a report that is sought after by departments outside of compliance. Typically, compliance officers are usually the keepers of the prized data, but if utilized well, HMDA is used to enhance operations, eliminate redundancy, and proactively monitor fair lending and data integrity risks. However, if I were in a sales/production role I would be proactively seeking
out the information to guide the company’s diverse market strategy.
1. Know your territory and It’s diverse market potential
Most sales leaders know their territories well, but rarely realize the demographic trends happening within them. Having a territory that is experiencing major demographic shifts can be an excellent opportunity to gain market share, as well as serve individuals that may not otherwise be aware of their ability/capability to be a home owner. A good place to get a broad view of what’s going on in your area would be Census.gov.
2. Talent review and language capability
Understanding the demographic trends in your area will also help you determine whether or not you have the right people in place to serve the community. If you know you are in a market with a high concentration of Latinos, chances are you will need someone who can speak Spanish. Also, make sure you confirm the proficiency level of the candidate. Someone who can order off a Mexican menu doesn’t constitute a proficient speaker!
Did your previous year’s HMDA volume match where your market and people are?
Although HMDA data is dated information, it’s a great way to directionally see if you are missing the mark in your market. Did your diverse volume match the demographics in your area? Which lender did? Use that information for best practices, marketing and recruiting purposes.
1. If it did, you have a success story you want to leverage and replicate: Don’t be surprised when you come across a market where you are doing well! As a consultant, it’s always great to see a client pleasantly surprised when they have a success story that they simply weren’t aware of. Understand what’s being done well and replicate if possible.
2. If it did not, you know where you are missing the opportunity and where you should focus your recruiting and marketing efforts: If you aren’t doing well in a particular area, fix it! Your HMDA data can also help you guide what you need to fix.
Are your applications at par with your peers? If so, perhaps you need to do a deep dive on the back end process? Do you close well compared to your peers but your applications are below the peer group? Then perhaps you need to focus on your front end outreach and marketing.
Make the data work for you. Share the data as fast as you can with your internal partners. Have a cross-section of departments represented to see how the data can work across all functions. Properly interpreting the data will provide a clear direction to the benefit of the organization and borrowers.
