It’s hard to resist a good bargain. And U.S. homes are currently the biggest and best bargain on the block. Many prospective home buyers are taking advantage of a housing market made vulnerable by a down-and-out economy. The latest Housing Opportunity Index released by Wells Fargo and the National Association of Home Builders reported approximately 53.8 percent of all new and existing homes sold nationwide January through March 2008 were affordable for families earning the median household income of $61,500—a 44 percent increase from the first three months of 2007. In fact, these are the most affordable prices since June 2004.
Granted, one must consider the Index doesn’t account for buyer expectations. Even though it’s a buyer’s market, a lot of people remain reluctant to take action in an unstable climate. With competition levels skyrocketing, real estate professionals are losing jobs faster than one can say “sold.” For those fortunate enough to continue serving this market, it is even more vital to turn potential customers into active customers. However, the knowledgeable distributor will ultimately get the sale. To learn more about the selling opportunities real estate can bring to the printing industry, Print Professional spoke with several leaders in the market.
Legalize This
Nobody likes to hear the “F-word,” but today it’s inevitable. More than one million homes are in foreclosure. New studies suggest consumer confusion is to blame. The Urban Institute found that after purchasing a home, many American consumers overpay—by thousands of dollars—in total closing costs. In addition, disparities exist among total loan fees and title fees. Essentially, Americans are signing piles of documents they can’t comprehend, and are literally paying the price.
To assist end-users and their customers with the complexities of legal documents, Data Legal, the Legal Documents Division of Pummill Business Forms/Concept Forms, Grand Rapids, Mich., has taken extreme measures to stay up-to-date with regulations mandated by local, state and federal agencies. The company offers a vast product line of residential lending documents aimed at the mortgage lending industry, including federally mandated and RESPA documents such as: HUD Settlement Costs and Helpful Information booklets; Truth in Lending Disclosures and Consumer Handbook on Adjustable Rate Mortgage booklets; and other origination documents, like Home Equity Lines of Credit booklets; Uniform Residential Loan Applications and HUD case binders.
“There are [a lot] of opportunities in this market. A distributor can walk into any bank or credit union that does residential mortgage lending and know that, by Federal Law, [he or she] should be handing out HUD booklets for every Uniform Residential Loan Application process[ed],” enthused Bob Jones, general manager. “Most distributors shy away from these opportunities due to their ‘compliance’ issues.”
This is where companies like Data Legal can help. The company regularly educates itself on the most recent revisions issued by the Federal government to keep customers in compliance. “We subscribe to HUD, VA, Fannie Mae and Freddie Mac mortgage letters, bulletins, announcements and selling and servicing guide updates. We also maintain a subscription to AllRegs,” he stated. “All our documents are reviewed completely by real estate attorneys for accuracy.”
Jones mentioned that compliance products can also be used as an alternative way for end-users to market their company. Through customization, Data Legal imprints booklet products with a company’s name, address and phone number, which increases exposure during the loan application process. These booklets are printed on lightweight papers and are sized to circumvent increased mailing costs, he said. Furthermore, the booklet products are based on a center-glue construction, another budget-friendly element which eliminates some offline production steps and the use of staples.
Jones did acknowledge that industry-specific software, such as WINForms, has reduced the number of pre-printed forms used by lenders. However, government-backed loans have resulted in an upsurge in the use of HUD Case binders. And, distributors can still turn to print suppliers for documents not easily produced by computers and laser printers, as well as for documents requiring tamper-proof features.
Security issues are becoming an increasing concern as proven by the numerous reports of mortgage fraud in the news. According to CNN Money, financial institutions received record-high amounts of “suspicious activity reports.” Through the first six months of the current fiscal year, 33,359 reports were documented, with FBI officials predicting figures to reach 70,000 by the end of the year.
Headquartered in Westampton, N.J., Paris Business Products has answered calls for added security on documentation. Linda Schertel, national sales manager, explained how some mortgage companies put information on blank paper, which is very easy to scan and alter. The company’s line of security paper boasts a variety of techniques including:
• Heat-sensitive red thermochromatic ink
• VOID pantographs
• Artificial watermarks that are coin-reactive
• Toner grip paper
• Chemically reactive papers that become discolored if a solvent is used to alter information.
Schertel commented, “The security industry is a growing marketplace and only limited by the lack of [question asking].” She went on to recommend distributors even ask end-users seemingly basic questions about the growing amount of published accounts of identity theft and fraud, or if they are aware of how much attorneys charge in the event they find themselves needing one for failing to protect their investment.
The Flip Side
Forms aren’t the only selling opportunity in the real estate market. Located in Macomb, Mich., Admore, A Div. of Ennis, produces a variety of presentation folders, expansion portfolios and collateral materials to support customers’ marketing efforts. Portfolios are ideal for holding closing papers or other large amounts of paperwork.
While some may not recognize the added value of an attractive binder or a colorful business card, image is everything for realtors. The products they carry will be used to communicate a specific message to their customers. Sales manager John Andersen, CAS elaborated. “It is my belief that real estate people want to come across as being reputable, professional and having ties to the local community. Our four-color process business cards with the agent’s picture prominently printed on the card helps accomplish this. You might recognize [him or her] as a neighbor whose name you did not know,” he mentioned. “The folders we produce are made from a rigid stock. [They] show you are dealing with someone who cares about the image of their company. Th[ese] folder[s] can say a lot.”
Andersen reminded distributors to think about homeowners, as well. Admore recently found success with the launch of its photo holders for the real estate market. First-time homeowners, in particular, feel a great sense of accomplishment and excitement after making such a life-changing purchase. Naturally, they want to show a photograph of their new home to everyone and anyone.
“[The photo holder] has the real estate agent’s logo on the front cover, [it has] room for a business card and then, [it features] a picture of the happy couple standing in front of their new home. This is great exposure for the real estate agent, as well as a keepsake [for purchasers],” he said.
Baltimore-based B.C. Lucas Packaging and Presentation Solutions, a supplier of custom presentation materials and packaging solutions, is capitalizing on other trends in the market. “The surge over the past decade both in new home construction and 55-plus, life-care communities has led to a dramatic increase in promotional materials to support them,” observed Robert B. Clark, sales representative. “By putting instruction manuals and maintenance information in a distinctive package, the buyer[s] feel well-rewarded for their purchases, and that binder or tote serves as a constant marketing reminder, not only for the buyer[s], but for anyone who might visit their home[s].”
Making Settlement
Jones suggested distributors investigate eco-friendly alternatives and use this topic as an extra conversation opener. Data Legal has been manufacturing green items since its beginning in 1990—well before the global-warming mania. The environmentally friendly features of the company’s products include recycled or recyclable paper, soy-based inks, aqueous printing plates instead of toxic, solvent-based plates and biodegradable glues. Meanwhile, more than 50 percent of Admore’s standard paper stocks are Forest Stewardship Council (FSC) certified and its binders are produced on FSC stock.
Andersen also encouraged distributors to gain access to product samples. “We have found that when distributors request and use these samples during the sales presentation, it brings about a lot of opportunities that may not have come up,” he noted. “In an industry like real estate, where a lot of the business is based on perception, it is nice to show the customer what other successful realtors have done and make sure they are keeping up with that level of professionalism.”
For many suppliers, spring and fall are traditional peak times for real estate orders. Distributors are encouraged to take advantage of the slower summer months to catch up on their own pile of paperwork. By working smarter, distributors can guarantee they’ll be a household name for years to come.