A loan-to-value (LTV) ratio is the correlation between the amount left on your mortgage and the value of your home. For example, if your LTV ratio is 80%, you own 20% of your home, financially speaking.
When it comes to mortgage marketing, having an accurate LTV can be a critical criterion when assessing which consumers are right for your offer. For example, perhaps you don’t want to target a consumer for a cash-out refinance offer if they only have 10% equity in their home. On the other hand, a consumer with 40% home equity, along with various other targeting attributes including their credit score and revolving debt levels, would be a great candidate for your cash-out refinance offer. Being able to consider a consumers LTV prior to your marketing outreach could save your company valuable time and effort – and increase your ROI.
If you’re not already factoring LTV into your data strategy, now is the time to start. And if you need help getting started, we’re here to help. Here are few tips:
Use a Mortgage Marketing Service that Calculates LTV and has the Current Value
Finding a data provider with the right data assets to calculate LTV might not be as easy as it seems. To calculate LTV a data provider must have the consumers estimated home value and their current mortgage balance. Some data providers have one but not the other – but finding a provider that has both data points, and the data science team to run the calculations on each record, equips you to make a more informed decision on which consumers you are targeting.
In addition to having the “ingredients” necessary to calculate LTV, it’s also extremely important to ensure the values are being updated on a regular basis – especially in today’s volatile market. Your data provider should be assessing a consumer’s current mortgage balance and home value monthly.
Use LTV for your Prescreen and ITA Campaigns
Lastly, LTV can be used in both prescreen and ITA campaigns. While prescreen LTV will be more accurate as the current mortgage balance is easily queried, it is possible to make an educated calculation of a consumer’s home value by using non-FCRA regulated data. Our data science team uses various ITA data points to calculate a consumer’s estimated home value which is then used in our LTV calculation. Whether your business is looking to run a prescreen or ITA campaign, Altair is here to help with top-notch data assets.
Altair Data Can Provide All You Need
At Altair, we believe having better data leads to better decisions. Not only do we maintain one of the most robust consumer databases in the country, but we do so while maintaining quality records. If you are interested in learning more about integrating LTV into your marketing strategy, contact one of our analysts today by emailing: asales@altairci.com or by calling us at 615-468-6800.