What exactly is a “bad credit mortgage lead”?
In the mortgage lead industry, it seems that for a few years now, a “bad credit mortgage lead” has been the scratch-and-dent product of the industry.
True, some organizations (mostly credit repair organizations) love to buy them up, but most lenders don’t.
As guidelines have started to relax in 2016 and into 2017 – what used to be considered “bad credit” seems to be changing.
If you are a lender who has guidelines that will allow down to a 580 minimum credit score, there are significant opportunities to exploit where other lenders have overlooked people that you can help get qualified for a loan.
What Defines a Bad Credit Lead?
When people come to one of our websites, we have them self-rate their credit. This is common in the industry as a whole – and we are no different here.
Our typical self-rated credit scale looks like this:
Most of our websites have guideline numbers regarding credit scores, but this doesn’t mean that a consumer is selecting the right credit rating when they self rate. Many consumers don’t exactly know their credit score, so expect to have some consumers select the “wrong” credit rating when they are choosing their credit rating.
Bad Credit Purchase Leads vs. Bad Credit Refinance Leads
It is worth mentioning that many of our clients report a big difference in performance between bad credit purchase leads and bad credit refinance leads.
The most common thing we hear is that people who want to buy a house and have bad credit are much more likely to work with you on a long term basis as you help them fix their credit and buy a house. The consumers who want to refinance their house are really just shopping lenders who have guidelines that meet their credit score – and commonly have been turned down by multiple lenders already.
Bad Credit Leads: The Key To Success
The single-most-important thing that a lender can have in place to make a bad credit mortgage lead campaign work is to have a simple action plan available for those people who don’t meet the minimum guidelines.
No matter how well consumers self-rate their credit, there will be consumers who don’t meet the minimum guidelines – and by implementing a simple process for the people who don’t meet the minimum credit score to work with a credit repair firm to fix their credit.
Bad Credit Mortgage Leads in 2017: Things Are Different
Bad credit mortgage leads in 2017 are much different than bad credit mortgage leads in 2014.
Guidelines are expanding.
More consumers are wanting to buy a house and have credit that used to be considered “bad” but now can easily qualify for an FHA or VA loan with a 600 credit score.
This means more opportunities for lenders who have seen guidelines expand in the last 12-24 months – because we have more people than ever before on our websites asking to be matched with a lender.