Comprehensive Strategy Plan: Mortgage Company Analysis and Strategy

This report provides a detailed strategic plan for a mortgage company, encompassing a comprehensive situational analysis, including SWOT and PEST analyses, along with competitive and market analyses. It outlines marketing goals, segmentation strategies, and market positioning, while also delving into marketing tactics such as product, service, pricing, distribution, promotion, and people strategies. The report further examines consumer and market research, consumer behavior, and proposes a marketing budget. It includes an evaluation framework and an implementation plan, providing a holistic approach to the mortgage company's operations and strategic development. The plan covers various aspects from marketing strategies to financial planning and customer acquisition.

Strategy Plan of a Mortgage Company 0
Title: Strategy Plan of a Mortgage Company
Assignment Name:
Student Name:
Professor:
Date:

Strategy Plan of a Mortgage Company 1
1. Executive Summary
A mortgage company is a legal firm engaged in the business of funding mortgages for
commercial or residential property. The company is regarded as the originator of loans. The
company will market itself to be as the prospective borrower and takes funding from several
clients that will provide the capital for mortgage. A complete SWOT and PEST analysis is
provided. A brief summary of marketing goals, marketing segmentation and marketing strategy
has been provided. Market positioning and market tactics strategy has been provided. An
overview of research, consumer behavior, customer evaluation and implementation plan and
strategy to be used has been given.
Contents

Strategy Plan of a Mortgage Company 2
2. Situational Analysis.....................................................................................................................4
2.1 SWOT Analysis...................................................................................................................................4
2.2 PEST Analysis.....................................................................................................................................4
2.3 Competitive Analysis.........................................................................................................................5
2.4 Market Analysis.................................................................................................................................5
3. Marketing Goals..........................................................................................................................6
4. Marketing Strategy......................................................................................................................7
5. Market Segmentation...................................................................................................................7
6. Market Positioning.......................................................................................................................8
7. Marketing Tactics........................................................................................................................8
7.1 Product Strategy................................................................................................................................8
7.2 Service Strategy.................................................................................................................................8
7.3 Pricing Strategy..................................................................................................................................8
7.4 Distribution Strategy..........................................................................................................................9
7.5 Promotion Strategy..........................................................................................................................10
7.6 People Strategy................................................................................................................................10
8. Research.....................................................................................................................................11
8.1 Consumer Research.........................................................................................................................11
8.2 Market Research..............................................................................................................................12
9. Consumer Behavior...................................................................................................................12

Strategy Plan of a Mortgage Company 3
10. Marketing Budget....................................................................................................................13
11. Evaluation................................................................................................................................13
12. Implementation Plan................................................................................................................14
References......................................................................................................................................14

Strategy Plan of a Mortgage Company 4
2. Situational Analysis
2.1 SWOT Analysis
Strengths-Mortgage banking can remain profitable at all the times. ROI is very high for
these companies and generation income is easy. Large profits are made through the closing fees.
Weaknesses-The revenues are mortgage companies have close correlation with economy. Rising
interest rates can severely impact the mortgage business.
Opportunities-A business must be able to obtain warehouse line of credit. The mortgage
company can have additional firms for generating passive income.
Threats-The rules and regulations are changing and the potential threat faced is with the credit
market (Gumbau-Brisa & Mann, 2009).
2.2 PEST Analysis
Political- Political factors include taxation policy, environmental law, labor law and trade
restrictions.
Economic-Economic factors include economic growth, exchange rates and inflation rates. These
have the major impact on how the business operates.
Social-Social factors include age growth, population growth rate and cultural aspects affect the
demand for a company’s products and services.
Technological-Technological factors include Research and development activity, rate of
technology change. These factors determine barriers to entry.

Strategy Plan of a Mortgage Company 5
2.3 Competitive Analysis
Demand for service? Very competitive in
nature
Direct and indirect competitors? Mortgage companies,
Refinancing companies
and government.
Strengths and weaknesses of competitors? Analysis of macro and
micro environments for
the organization is
strength, economy
recession and falling
interest rates is its
weakness.
What markets are your competitors targeting? The social,
technological,
environmental markets
are being targeted.
An analysis of market shares: The Five Forces model
shape strategy and
competitive forces.
Similarities between your business and competitors: Matching of
competitive rates to
earn the profitability.

Strategy Plan of a Mortgage Company 6
A general analysis of the competitive marketplace in
which you operate:
The PESTLE analysis
can have a direct
financial and strategic
impact over the
profitability levels of
the business.
2.4 Market Analysis
(a) Market growth rates? Market Segmentation
will help segmental
loan growth.
(b) Market expansion opportunities? Cold calling leads
(c) Total market size? Loan operations
include more than 76
percent of total
customers
Growing or declining marketplace? Lenders and agents can
work together for
growing marketplaces.

Strategy Plan of a Mortgage Company 7
3. Marketing Goals
What percentage increase in conversion from enquiry
to settlement do you want to achieve?
It is dependent on the
prospects and additional leads
and conversional rates. It may
vary from 40 to 55 percent.
Where would you like your business to be in 12
months’ time?
A stabilized business earning
profit.
What growth in client numbers do you want to
achieve?
20 to 25 percent
What percentage increase do you want in sales? 60 to 65 percent
What growth do you want in profitability? 40 percent growth in
profitability
What growth do you want in staff numbers? 2 more employees
What new services do you want to offer? Mortgage Loan portfolio and
EYC analytics
How many new distribution channels do you want to
establish?
Two new distribution
channels depending on the
profitability
What percentage increase in new enquiries do you
want to achieve?
Through cold calling enquires
can be increased up to 30
percent.
What percentage increase in repeat business do you
want to achieve?
An 100 percent increase in
repeat business in necessary.

Strategy Plan of a Mortgage Company 8
4. Marketing Strategy
a) Market Penetration-This results into fierce competition from national banks.
b) Market Development-The market development is a secondary market where mortgage
and other financial funds are sold.
c) Product Development-The combinations of loan, collateral and borrower forms the
financial product.
d) Diversification-Investor can manage risk by diversifying the risk into different asset
categories.
e) Retrenchment-Retrenchment cover must be provided in the financial loan book(Chen &
Yang, 2018).
Few other Strategies-
1. Niche Marketing Strategies-Developing a niche marketing strategy for a new
mortgage market segment can be profitable.
2. New Product Opportunities-The value propositions are known as the market options
provided to the lenders.
3. Matching services offered to chosen market segments-New variety of financial
products launched into markets.
4. Customer Acquisition via Customer Retention-Substantial interest rates can gain
customer acquisition and repeat customers.

Strategy Plan of a Mortgage Company 9
5. Market Segmentation
Who is your ideal client? Financial Planners and
solicitors
How well do you know and understand your chosen
target markets?
Selected competitive
forces can provide strong
growth.
How well do you understand their lending needs? These are repeated
customers and market can
gain good market value
Are there ways to segment your market so you can offer
highly specialised products to specific groups reflecting
their individual needs?
Different categories of
financial products can be
offered like insurance
products and financial
mortgage products.
6. Market Positioning
“Branding Products in the Mortgage Industry” requires understanding the perception of
consumers and controlling the direct competitors in market place.
7. Marketing Tactics
7.1 Product Strategy
The Company will offer commercial mortgages, personal loans, residential mortgages and leases

Strategy Plan of a Mortgage Company 10
and other products. The target segment is financial institutions and solicitors and offered at a
lending rate which is lower than the markets. The pricing implementation is done by the lender
panel.
7.2 Service Strategy
The best mortgage marketing strategies are used which cater to the financial service institutions.
For example-Cross-selling of products.
7.3 Pricing Strategy
The pricing strategy adopted can be enumerated as follows-
(a) Do you charge brokerage fees, receive commissions or a combination?
Depending on the daily shifts in mortgage markets, the company charges brokerage
fees, receives commissions.
(b) What is your average lender commission rate (upfront and trail) and average brokerage
fee?
All are at the market prices. An understanding of the mechanics of pricing mortgages
needs to be developed.
(c) Do you receive any volume bonuses from your aggregator or franchisor?
The expectations of receiving bonuses can change continuously and largely dependent on the
market interest rates.
(d) Do possible biases exist in relation to differing commissions?
A change in the expectations compared with face value of market share price is dependent on
numerous factors.
(e) Do you pay referral fees for introductions from strategic alliance partners?

Strategy Plan of a Mortgage Company 11
Yes, referral fees are paid for introductions from strategic alliance partners.
(f) What is the average size of mortgages in your geographic location?
Security prices are combined with the loan to value rations and average size of mortgage
is produced, dependent on different geographic locations.
7.4 Distribution Strategy
(a) You should describe how your service is delivered to your target markets.
The service is delivered through various distribution channels like print ads, direct mails and
others.
(b) Explain the distribution methods you are employing and justify your choices.
The company size is not too big. The company needs to create a brand and special promotional
strategies to create a market value.
(c) Do you have an internet presence?
Yes, without having the internet presence the company cannot start its operations.
(d) Do you have mobile lenders with the ability to function efficiently in client’s homes?
Lenders and loan officers need the best marketing strategy.
(e) Do you have public offices with private interview rooms?
Mortgage content marketing strategy is possible through public offices.
(f) Are there any other specific distribution channels that would be appropriate for your
particular business? For example, if you target high level managers from a few key
companies perhaps you could hire an interview room within their building for a day
each week.
Mortgage marketing strategy uses bulk mail strategies for targeting the particular business.
(g) How do your distribution channels fit into your overall marketing strategy?

Strategy Plan of a Mortgage Company 12
Mortgage marketing strategy is focused about the complete structure of distribution channels
rather than its financial rates.
7.5 Promotion Strategy
People purchase home at their own convenience levels and financial planners adopt various
marketing strategies like news latters, direct mail letters and advertising to create a strong market
presence.
7.6 People Strategy
(a) What training needs to be undertaken to ensure your staff back-up your marketing
messages?
Mortgage underwriter training and current market analysis is required
(b) How will you communicate new marketing initiatives with your staff?
Diagnosing the training needs can provide insight into mortgage industry.
(c) How will you generate marketing ideas from your staff? Remember the most important
people in your marketing equation are your staff and clients – you need to consider both.
The regulatory climate seems to be evolving and documentation of mortgage loan servicing is
essential.
8. Research
8.1 Consumer Research
(a) How will you monitor the changing needs and preferences of your clients?
Analysis of consumers and evaluation of interest rates and sub-prime rates can be done.
(b) What methods will you employ to gain the insights you require?

Strategy Plan of a Mortgage Company 13
Market factors have a major significance and help in gaining insights on the consumers
perspective.
(c) Who will be responsible for implementing the research findings?
Financial planners and staff members are responsible for implementing research findings.
(d) How will staff be encouraged to gain ongoing client insights? And how will they be
rewarded?
Research reveals attitude and perception towards home ownership and staff can be awarded
through the policies and award regulations decided by the company.
(e) Will you use an external research company or consultant to assist in the design and
delivery of research?
Financial intermediaries can be used as external research company for assisting in design and delivery of
research.
8.2 Market Research
(a) How will you monitor trends in the economy? For example property sales, interest rates, lending
volumes, consumer trends, etc.
Household finances, mortgage rates, lending and interest rates are required to be monitored on a daily
basis through regular assessment and evaluation.
(b) Are there any specific areas you need to monitor, because of your marketing strategy? For
example, if you target non-conforming borrowers you would be interested in levels of financial
hardship.
Global banking methods can be adopted for reaching customer communities.
(c) How will you access industry trends? For example memberships of industry associations,
aggregator’s newsletters, industry journals, networks and government departments.

Strategy Plan of a Mortgage Company 14
Access to online mortgage brokers information is provided to all the companies.
9. Consumer Behavior
(a) Why borrowers use your mortgage broking service?
The borrowers use mortgage borrowing service as it is easily available and have sublime interest
rates.
(b) What the perceived benefits of your service are?
The perceived benefits are easy to avail mortgage loans.
(c) What are your client’s expectations and does your service meet their standards?
Customer referrals created by customers is of great importance and these act as an effective tool.
(d) How do you gain their loyalty?
Learning the best marketing tactic and regular holding meetings can gain loyalty
(e) Why do your clients use your services over other mortgage brokers?
The lower interest rates can often repeat customers.
(f) What type of loan features most appeal to your prospects?
Lower lending rates and widely available information appeal to the prospects.
(h) How are choices made when deciding upon a mortgage broking service?
Depending on the economy and lending rates and ease of availability are few choices
can be made through mortgage broking service.
(i) Are borrowers typically presold on a brand or are they more impulsive?

Strategy Plan of a Mortgage Company 15
Depending on the needs and financial information provided, an financial borrower can
be impulsive or brand conscious.
(j) What activities do your prospects enjoy in their leisure time?
Access to the information bulletin.
10. Marketing Budget
Loan officers need to plan their marketing budget by identification of target market and invest in
developing personas.
11. Evaluation
Medium size marketing companies invest in marketing as investing is low. This can have a
positive impact on the target market.
12. Implementation Plan
Strategy Actions Who When
Digital
Marketing
strategy
Bulk mail campaigns and
installation of appropriate
software and awareness
of online marketing
strategies
Mortgage
companies
This strategy is
ongoing.