In the age of rising operating costs and falling profit margins, getting more people into the credit system can do wonders to your mortgage business.  The unbanked and underbanked households have for long been a treasure trove, which financial institutions have never really bothered to tap into. In today’s trying times, looking for and making roping in customers who do not quite fit into the traditional definition of qualified loans is a growing imperative. For this, lenders need to go out the conventional way of qualifying customers, and at the same time, adopt aggressive tactics to woo them.

Sample these stats: Experian says at least 64 million consumers in the United States do not have a FICO credit score, and 10 million of them are prime or near-prime consumers; Fannie Mae says that 5 million people staying in rented accommodation and without credit scores can own a home; survey finds that 36% of young people between the ages of 18 and 29 have never had a credit card, and FDIC says that 7% of all US households are unbanked and 19.9% underbanked. The jackpot, therefore lies in this huge pool of “unqualifying” section. However, to turn this vast underserved section into long-term customers, lenders need to identify them and gauge their creditworthiness through other metrics. In this blog, we talk about some ways in which lenders can use to expand their business.

It’s Time to Consider Alternative Score

A detailed study by FICO’s data scientists have qualified 15 million consumers based on alternative data such as internet and phone bills, property records, insurance payments, utility payments etc. And credit based on alternative score is perfectly recognized in the eyes of law. All that a lender needs to sanction loans is proof of non-traditional payment history. Thus, by tailoring non-traditional credit history programs lenders can draw would-be borrowers, who would otherwise be pushed into the secondary mortgage market.

Use Big Data Analytics to Qualify More Underserved Individuals

Big data helps lenders to better understand the underserved segments for creditworthiness. It uses hundreds of factors like employment history, length of credit and many seemingly unimportant elements like number of emails sent in a day to Facebook contacts and tweets to predict risks as well as modify mortgages as appropriate for borrowers in financial distress.


If it the loan seeker is taking a while to type an email address, big data interprets it as attempt to use a new email created just for applying for the loan. This can serve as a forewarning. Likewise, those using Apple devices are less risky to lend to.

Offer Competitive Pricing

This is one unbeatable advantage which private lenders enjoy over banks and can use it to draw more unqualified borrowers. But how do lenders ensure this all the time? By keeping operating ratios under control and widening funding sources. Operating ratios can be controlled by designing solutions such as by embedding granular analytics throughout operations and using a well-integrated omni-channel system. To expand funding sources, lenders need to make asset class accessible to financial experts.

Expanding Reach through Partnership

Banks and other lending institutions have a large list of clients, a sizeable section of whom do not qualify for mortgage loans. Partnering with banks can help lenders get easy access to this undeserving section and tailor a suite of programs to woo them. Further, the credibility of the traditional financial institutions can give lenders the trust they need to win them over.

Simplify Borrowing Experience

Making things complicated for undeserving borrowers can rob lenders of many satisfied testimonials and fuel a bad word-of-mouth review. Besides fixing critical pain points, lenders need to take special care to tailor each experience like preparing undeserving clients for everything that will come, use technology to speed up the closing process and be timely with their responses.

Expert Mortgage Assistance (EMA), has over ten years of experience in streamlining mortgage processes and making it faster, easier and more economical. If you wish to give your mortgage processing, underwriting, closing, post-closing and title services, the right competitive edge contact us now.