Mortgage Facebook Ads Are a Waste of Time for Loan Officers. Period.
Low conversion rates, no intent, lack of targeting options, and constant ad
disapproval/ad account shutdowns make Facebook Ads a time-consuming option
for loan officers to market online. The top companies in mortgage lead generation
drive traffic from live Google searches to ensure they are targeting the leads with
the most intent.
Facebook Marketing for Mortgage
Isn't What It Used to Be
Running Facebook Ads for loan officers first started becoming popular around 2015-2016. At that point, Facebook was an extremely powerful tool for mortgage marketers. You were able to target people based on recently having visited Zillow, Trulia, or Realtor.com. You could target people that were "likely to move" or "first-time homebuyers" as defined by Facebook's data algorithm. You could target demographics such as married, with a 700+ Credit Score, making $100k+ a year. All of these things made it so that although you didn't necessarily have the intent that you can get on Google, you at the very least had the ability to filter who your ads were shown to in order to limit your time invested into "bad leads."
However, all of these targeting attributes were bound to end at some point considering most of them can be scrutinized under ECOA, or the Equal Credit Opportunity Act. Lawsuits from HUD and pressure from legislators forced Facebook to really tighten up targeting in the Housing and Credit space. In fact, it could be argued that Facebook doesn't want mortgage lenders advertising on its platform. After all, it takes a lot for Congress to get involved in an advertising company's affairs. Housing, credit, and employment are 3 of a handful of industries that can get Facebook in trouble without proper restrictions in place. Facebook is only getting worse for mortgage lead generation, but the good news is there's a much better alternative available!
Mortgage Facebook Ads Only
Became Popular Because Nobody
Could Figure Out Google
The rapid popularity of mortgage Facebook ads stemmed from a small handful of internet marketers who learned how to generate leads on Facebook for different industries. For loan officers who had bought leads in the past or who had run Google Adwords prior to the recession when the cost per click was a fraction of what it is today, the allure of a new platform where you could generate leads for less than $5 a lead was obvious. Especially when everything you find on Google Adwords for loan officers suggests that your cost per click would be $10-15. Making your cost per lead upwards of $50.
When Empower's co-founder, Michael McAllister saw how terrible the quality of leads he was generating on Facebook was in 2016, he knew there was something wrong. He knew that Quicken Loans and Lending Tree couldn't be generating their leads from Facebook. Through some investigation, he learned that they generated the majority of their leads from Google. At that point, he set out to "crack the code." To this day, there are still far fewer mortgage loan officers and mortgage marketers that know how to generate long-form mortgage leads on Google for less than $10 a lead. This makes it an EVEN BETTER place for loan officers to market.
"If you are considering Facebook leads, I would definitely recommend talking with Empower first. Just because the biggest thing that I've noticed is the difference in the intent behind these leads. These are people that are actually looking to buy a home as opposed to just scrolling through their newsfeed and happen to click on your ad."
Brent VanderGriend - Sodak Home Loans - Sioux Falls, SD
The More You Improve Your
Mortgage Facebook Ad Copy
and Offer, The Worse Your
Changes in Facebook's ad policies have led to a lack of intent and a lack of ability to non-discriminately target the most profitable and likely customers. When you're using Facebook marketing for mortgage loans, you need to consider that 99% of Americans want to buy a home at some point. So, the ONLY way you can determine who has intent is through targeting, which again has been made virtually impossible by Facebook. You don't have this issue with very many other products. For example, office chairs. If you were to market office chairs, you could target people based on their interests, age, gender, job title, and etc.
You could limit your ads to only people that were likely to be in a position of need and means to buy an office chair. With mortgages, not only do you have a much broader audience with much broader current interests you're competing with for attention but you can't use any of those targeting categories to limit your audience. This results in the challenging fine line that you have to walk between making your ad copy and/or offer enticing enough that you can capture attention, but not too enticing to where you start to get people inquiring that are too far from actually buying a house.
Loan Officer Facebook Ads Suck
Up Your Time, No Matter How
Much Automation You Use
Confront someone generating mortgage leads on Facebook with a question about lead quality, and you'll almost always hear the same thing: "I only have to work the leads that want to talk to me, so it doesn't matter how crappy the leads are." While we do agree that automating your initial contact is important, it is not a replacement for generating mortgage leads with high-quality traffic. As we say, "Garbage in, garbage out." When you generate mortgage leads on Facebook, you're generating leads too high in the mortgage sales funnel. When you generate mortgage leads too high in the sales funnel, you spend A LOT of time talking to people who are happy to talk to you and take up plenty of your time but won't actually be ready to pull the trigger anytime soon.
Successful Consumer Direct
Mortgage Marketing Companies
Prefer Google to Facebook when
Marketing for Mortgage
This is arguably the most important point to consider when deciding where you're going to spend your advertising dollars. In our Mortgage Marketing Guide, we talk about the importance of reverse engineering a successful mortgage marketing campaign. Many people take this to mean that if they see a Quicken Loans Ad on Facebook, that they should mimic what they're doing. However, you have no way of knowing how successful Quicken Loans is on Facebook.
In this article, we take a look at where the best companies in consumer direct mortgage lead generation generate the majority of their mortgage leads. You can see there that Quicken Loans receives less than 3% of their traffic from Facebook, which means you should be looking elsewhere when generating leads. This same fact holds true for other large consumer direct mortgage or mortgage marketing companies like Veterans United (AKA Mortgage Research Center), Zillow, LendingTree, and more. Why reinvent the wheel?
Facebook Ads Suck, So Where Should You Be Generating Your Mortgage Leads?
Facebook Ads only every became popular for loan officers because there were a handful of new marketers that couldn't figure out how to generate leads the way the top companies in mortgage lead generation were generating them. Facebook Ads hit the scene hard and fast, and they used to be really easy to run, even for a loan officer with no advertising experience. However, none of the top companies in mortgage lead generation have ever received a sizeable amount of their traffic or leads from Facebook.
So where are they all generating their leads? It's the same place you should be generating yours too! Here's a hint: what's the first place you look when you have a question and neither you or anyone around you at the time know the answer?
You Google it