Sanford Brumley of Harris said, "Given the large proportion of consumers who are riding the fence, now more than ever would be a good time for these institutions to examine their mortgage product advertising and marketing messages."
Although most respondents had a low opinion of mortgages in general, 71% were favorably inclined toward fixed-rate mortgages. More than half of respondents also thought highly of home equity loans.
Consumers generally had high levels of awareness and knowledge about mortgage options, but product ownership rates were low. Over half of consumers did not have mortgages at all, while a third had traditional fixed-rate mortgages and 16% had home equity loans. The ownership rate of all other product types was under 10%.
The dearth of mortgage product ownership is not for lack of online ad spending.
The top 25 mortgage companies ranked by advertising spending are throwing money at display ads. Online display advertising grew 66.9% in 2006, to $222 million, compared with $133.1 million in 2005, according to TNS Global data provided to American Banker. At the same time, overall ad spending by this group increased just 7.6%, to $732 million in 2006.
Mortgage applications typically are complex and time-consuming. This explains why online mortgage application growth has largely been stagnant over the past several years, according to eBrain Market Research's "2005/2006 National Technology Readiness Survey."
Even consumers who are willing to go through page after page of questions online still must trust the mortgage provider's security measures.
eMarketer Senior Analyst Lisa E. Phillips said, "Advertising builds awareness, but in this market it doesn't translate into credibility necessarily."
