Cross-Selling to Your Mortgage Customers.

• Author: Kessler, Ann
• Position: Brief Article

Problem

Bankers have been told repeatedly that cross-selling products and services is one of the best ways to increase the number of relationships with existing customers. Banks traditionally have not done as much cross-selling with their mortgage customers. This is because, in the past, mortgages have come from a different part of the retail bank. There was not much coordination between mortgage officers and new accounts staff. How can a bank cross-sell more to their mortgage customers?

Solution

Cross-selling other bank services to mortgage customers makes a lot of sense since the volume and accuracy of the information the mortgage loan officers receive from applicants cannot be equaled. Mortgage banks affiliated with commercial banks may have to work harder at it, but the resulting sales of additional products brings added profits.

When is the best time to tell a mortgage customer about your other products? When the mortgage is dosed. Your new mortgage customer has built a relationship with your mortgage loan officer and trusts him as a representative of your bank. Training your mortgage officers about your deposit accounts, home-equity loans, etc., allows them to sell products appropriate to the customer's life stage. It is also possible for the mortgage loan officer to introduce the customer to a customer service representative or provide him with a coupon to use in obtaining discounted products. ("Mortgage Applicant Cross Sales Program Yields 57 Accounts," Deposit Growth Strategies, October 1997).

Another option is to target mortgage customers with direct mail or with advertisements included in their monthly statements. In fact, one good reason to move from the loan coupon book to a mailed monthly statement is to take advantage of the marketing opportunity. Setting aside a message box on the statement page lets the bank sell products that are targeted to homeowners. The bank can send direct-mail pieces to mortgage customers who don't have deposit accounts or home-equity loans with the bank. A smaller community bank might also make personal visits to new mortgage customers' homes. Offering these customers congratulations, a house-warming gift and discount coupons on bank products could cement their relationship with the bank for life. ("Keeping the Customer for Life," Mortgage Banking, February 2000).

A sensible promotion: home-equity loans

Home-equity loans or lines of credit are logical products to promote to new mortgage holders. The...