Those pesky direct mail mortgage offers most are accustomed to receiving became a little less of a nuisance in 2007, according to a report by media monitoring company Mintel Comperemedia.
As the mortgage crisis deepened and scores of mortgage lenders closed their doors, related mailers saw a marked decline.
Companies sent 34 percent fewer mailers during 2007, just 1.7 million offers compared to 2.6 million sent in 2006.
Interestingly, these campaigns quickly adapted to the changing market, with adjustable-rate mortgage offers declining by 72 percent from 2006 to 2007, while fixed-rate mortgage offers increased 14 percent during the same period.
“People have tightened up spending, home sales are down, and there’s not a lot of faith in the market,” says Farah Huq, market research manager at Mintel Comperemedia. “With fear of recession and many Americans struggling just to make ends meet, it makes sense that lenders have backed off direct mail advertising for the time being.”
Home equity loan offers were also down, likely because falling values didn’t bode well for those looking to open a second mortgage.
Mortgage lenders reduced offers for home equity lines and loans by 21% in 2007 to 930,000, down from 1.2 billion in 2006.
“As the housing bubble continues to deflate, we can expect companies to constantly readjust,” added Huq. “I wouldn’t expect to see dramatic increases in direct mail until the market has stabilized and consumers seem ready. Instead, I think we’ll see internal shifts in the top mailers and the types of offers advertised through direct mail.”
Eight of the leading 10 mortgage and home equity direct mail campaigns from 2006 cut the total number of offering sent in 2007, and of those that cut back, half reduced direct mail campaigns by more than 60% from 2006.