When mortgage interest rates decreased to 4.45% this past January, refinance volume jumped to 35% of all originations, according to data from Ellie Mae, with 13% of that volume owned by Millennials.
Mortgage Drop Encourages Millennials To Refinance
Dropping from 4.51% to 4.45%, the decrease in the 30-fixed mortgage encouraged Millennials to refinance their mortgages. Of borrowers who requested refinances in January, 13% were Millennial homeowners, a high since February 2018.
Ellie Mae Executive Vice President of Strategy and Technology Joe Tyrrell said, “While we continue to see Millennials enter the housing market and exercise their purchase power, the uptick in refinances may indicate maturity among this generation who previously purchased a home and are looking for an opportunity to take advantage of lower monthly interest payments.”
How To Market Mortgage Refinances To Millennials
Currently, Millennials represent a huge potential for mortgage refinances, so loan officers should make sure they clearly understand this audience. Here are some demographic details about Millennials who are looking to refinance their mortgages:
- The average age of Millennials who refinanced this past January was 33, according to the Millennial Tracker survey from Ellie Mae.
- Millennial males accounted for the primary borrower on 83% of close loans.
- 66% of the Millennials who refinanced were married while 33% were single.
- The average FICO score for Millennials increased to 722 in January from 721 in December.
If you’re able to work with Millennials on refinance mortgages, spread the word through Millennials’ favorite communications channels. Aside from email, get in touch with them digitally by adopting social media to connect. Millennials may be looking for loan officers on social media as part of the research stage before setting up in-person meetings. Interacting on social media can begin the relationship between a loan officer and a prospect and build trust as it presents the loan officer as a reputable resource.
Market a refinance as a chance to save money. Millennials are known for being money-conscious and are often looking for ways to save. Mortgage refinances can help them lower their interest rates and save money in the long run, so reach out to interested borrowers and present refinancing as an option to lower costs.
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