Five tips for tapping into the emerging Hispanic marketMariano Claudiohispanic, market conditions, marketing
The nation's Hispanic population is on the threshold of becoming
an economic powerhouse, with buying clout expected to reach $1
trillion in the next four years. During that same time period, Investor's Business Daily has
predicted that there will be 15 million first-time homebuyers
despite a cooling residential real estate market, and 60 percent of
them will be Hispanics and other minorities.
For those lenders who are up to the challenge, the keys to
success are identifying strategies to reach this market segment and
offering products that are better suited to their cultural and
economic needs.
With Hispanics and other immigrants poised to bolster the U.S.
housing market, Harvard
University's Joint Center for Housing Studies has said that
lenders need to understand the differences in the way mortgages are
obtained in other countries and learn how to get in touch with
these markets. According to the center, "As interest rates go up,
[mortgage lenders] are going to have to find a way to help people
buy homes, and the people who need homes are immigrants."
Pinnacle Financial
Corporation has created a nationwide emerging markets division
that is successfully meeting the home mortgage needs of the
nation's 43 million Hispanics. The division uses a variety of
strategies to reach this ethnic market.
The first step involves hiring qualified Hispanic loan officers
who know the local market. Look for professionals who not only
understand the basics of the mortgage industry, but also are
involved as leaders in the Hispanic community. These are people who
will have the knowledge to educate Hispanics about the home-buying
process, as well as the confidence to approach them and sell the
products you have to offer.
The next step is to research your community's demographics to
determine where the highest concentrations of Hispanics are
located. There was a time when Hispanic immigrants settled in urban
areas because that was where the jobs were. Today, however, more
and more Hispanics are choosing newer suburban developments where
the cost of living is less expensive.
Next, create a marketing campaign aimed at introducing local
Hispanics to your company. It doesnt take a big budget to get your
name out there. Get involved in the community. Sponsor youth and
adult soccer teams. Host a Hispanic chamber event. Become involved
in traditional ethnic festivals that are popular among Hispanics as
a way to remember and celebrate the heritage of their homeland.
Look for ways to reach Hispanic newcomers to your community.
Advertise in the local Spanish-language newspapers; the rates can
be very reasonable. Introduce yourself to the owner of the local
Hispanic market. Be honest about what you are trying to do -
provide loans for qualified Hispanic homebuyers. Most will be happy
to help you.
Another way to gain exposure is to offer free seminars for
first-time Hispanic homebuyers. Use your loan officers to explain
how home-buying works in the United States. First-generation
Hispanics, in particular, tend to be very apprehensive about this
process. It is important that the focus of these seminars is on
education and not sales.
Hispanics are very loyal people. If you show a genuine interest
in helping their community, they will feel comfortable doing
business with you and referring you to their families and
friends.
Pinnacle Financial has worked with Wall Street investors and the
insurance market to identify mortgage products that meet the unique
needs of Hispanics. The types of loans that have proven most
successful include residential alt-A programs that don't require
income verification, loans available to Hispanic homebuyers with
Individual Taxpayer Identification Numbers and programs that
require zero percent down (100 percent financing).
When it comes to home loans, Hispanic immigrants represent an
underserved and growing market with great potential. Lenders
willing to invest the time and resources to meet their mortgage
needs can realize enormous dividends.
Mariano Claudio is vice president of emerging markets for
Pinnacle Financial Corporation, an independently owned direct
mortgage lender. He can be reached at (703) 738-9380 or e-mail
[email protected].
