By Scott Ferguson
Lending Compliance Specialist at Smarsh, Inc.
2016 was a big year for socia medial. Instagram has adopted 60-second video ads, Facebook has grown to 1.71 billion users, Twitter to 320 million users, and LinkedIn to 450 million users. Plus, one million new active mobile social users are added every day. That’s 12 every second!
Lending and mortgage loan officers have certainly taken note of this growth and capitalized on it to reach more borrowers this year, even though social media compliance challenges remain.
What should mortgage companies prepare for in 2017 to tackle social media—from a technology, business, and regulatory standpoint? Here’s what’s coming down the pipeline in future risks and rewards. In 2017, loan officers will:
- Play ‘bigger’ with more professional business pages.
Loan officers know they need to be active where borrowers are on social media. Even one step further, loan officers now have to inspire confidence in their services before a prospect even speaks with them. Potential borrowers will look first to online social media reviews and a loan officer’s website to understand their reputation and quality of services. Without solid reviews/customer testimonials, a social media plan, professional websites, and social profiles, a loan officer may quickly fall behind in winning new business.
Social media is also very well suited for thought leadership activity. Loan officers and marketing teams can set themselves apart by regularly sharing the latest industry insights and available programs. Some great examples come from a loan officer who created a simple post on moving tips and a marketing team that shared how to identify and avoid mortgage assistance relief/foreclosure scams. Sharing this type of wisdom more effectively demonstrates that the loan officer and the mortgage company have experience, and keeps them in front of an audience that is inundated with content.
In 2017, loan officers (especially younger LOs) will be attracted to mortgage companies that intrinsically support their use of social media and a professional online presence to find and secure customers. The best companies will offer loan officers support through the use of clear social media and website advertising policies, resources, and compliance tools designed specifically for social media marketing.
- Use more video to reach potential borrowers.
Every year, everyone wants to know what the hot new social media platform will be. In 2017, there won’t be a massive shift of users to a new network in the mortgage industry. Instead, we’ll see a steady uptick in the use of video on social media platforms by loan officers. Also, marketing teams will continue to work on establishing sustainable video production programs. In the last few years, most have kicked off a program or two that started with a bang and then quickly fizzled out. In 2017, marketing teams will want to figure out how to sustain these programs, and they will become a high priority, because consumers will continue to flock to engage with businesses that provide rich video content.
Loan officers who increase their use of video for advertising purposes within the most popular social networks, including Facebook, Twitter, and Instagram, will be well-positioned to leverage this trend. Live video from Periscope, Meerkat, and Facebook will also become more widely used.
- Become more comfortable with pre- and post-publication monitoring process automation.
This year, lending and mortgage companies updated and enhanced their policies regarding social media use. For the most part, they made adjustments that account for new social media guidance in 2015 and 2016.
Over the past few years, many companies have attacked the various issues inherent in using social media advertising in a highly-regulated industry with brute force. Oftentimes, this meant higher budgets and head count. 2017 will be the year when mortgage companies replace the screwdriver of manual processes with a power drill and automate many of the procedures surrounding the creation and post-publication monitoring of social media content for regulatory purposes. Companies now recognize that social media marketing is often time-consuming, even though the benefit to business can be substantial. Tools that help companies and loan officers establish and maintain day-to-day controls and monitoring of social media (and website advertising) will be in demand. When lending and mortgage companies implement these solutions, social media marketing can become more effective, efficient, and sustainable in the long term.
- An uptick in self-governance of social media posts.
Over the last year, we saw countless politicians, celebrities, and professional athletes continue to embarrass themselves on social media. From a broad perspective, most people now realize social media and other digital communications can be a real liability to the reputation of an individual or company, if they are used without good judgement or with ill intent.
Loan officers and marketing teams will increasingly ask themselves a few questions before posting content. Questions asked will include, ”Who is this intended for and why would they care?,” “What is the purpose of posting this?,” “Should I check company policy first?” and “How will I measure success?” These concepts can apply to both business and personal social media content.
Now that the walls between personal versus business communication are virtually non-existent, loan officers who choose to embrace and prepare for this reality will come out ahead in 2017. Social media content, whether of a personal or business nature, can always be surfaced and shared more widely on social media. The lesson learned: Don’t post anything you wouldn’t want to see on the front page of The New York Post.
- Increase their pre-screening of advertising content ahead of state and federal audits.
Most loan officers know now that their social and website business advertising is publicly available. Regulators can and do find this social and website content before they ever even walk into a lender’s office to perform an examination or audit. In fact, regulators are scrutinizing the social media of loan officers on a much more consistent basis, because it’s the easiest, most accessible, and cost effective part of a business to review.
As regulators review their own operational budgets in 2017, they’ll likely become more efficient during examinations by viewing loan officers through the eyes of the consumer. Questions that may come up while auditing a loan officer’s social media profiles/pages could include, “Will this loan officer’s advertising confuse a potential borrower?,” and “Are the loan officer’s licensing, contact information, and required disclosures all in the correct place on their website and social media accounts?” Loan officers will need to pay attention to the details in 2017 to ensure examinations and audits go as smoothly as possible.
Bonus Prediction: There will be an increased amount of public-facing joint marketing with partners through social platforms as well. Mortgage companies and loan officers will increasingly use third-party validation to convey that they have the resources to guide borrowers through one of the most important decisions of their life. While this is powerful from a marketing perspective, it’s important to keep in mind the potential issues (e.g. RESPA) that can stem from such cross-promotion.
Scott Ferguson serves as the Manager of the Solutions Engineering Team at Smarsh, where he helps drive the growth of the company’s enterprise client base across a broad range of financial services industries including mortgage and banking. He can be reached at SFerguson@Smarsh.com.