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Where in the U.S. would you guess first-time homebuyers are having the most success securing a mortgage? The answer may surprise you. While over one-third of first-time homebuyers reside in our most populous states, California, Texas, Florida, and New York, research from Experian Mortgage reveals they are having greater success securing a mortgage in more affordable locations, such as Minnesota, Iowa, and Indiana. Understanding who is buying properties around the nation and what drives their decision provides insight into where they are buying and why. This knowledge paves the way for mortgage lenders to create more targeted and effective marketing strategies to gain trust and win loyal borrowers. As discussed in a recent blog post on generational behaviors, Generation Z (Gen Z) and Generation Y (Gen Y) account for a sizeable majority of first-time homebuyers and nearly half of repeat buyers. Mortgage lenders who understand what motivates these young buyers and meet them where they are will be better positioned to win. Why understanding buyer traits and their motivations matters Nearly 70% of all renters are in their early 40s or younger. With rents up more than 30% since before the COVID-19 pandemic, many Americans yearn for the stability that homeownership brings to their financial well-being. Younger buyers are increasingly focusing on their overall financial health. Experian's survey of more than 2,000 millennial and Gen Z consumers across the United States revealed: ‘Better understanding personal finance’ is a goal for most consumers within both groups. Nearly 70% are actively searching for a trusted source for personal finance information. Over 30% of first-time homebuyers have a household income under $90,000 annually. They want to make decisions that align with their financial goals and position themselves well for the future, which is likely why we are seeing a higher concentration of first-time homebuyers converting in lower cost of living areas, such as the mid-west. Even for a mortgage lender outside of the geographically preferred states, those who understand their areas with minute specificity and know where opportunity and affordability meet will be best positioned for these buyers. Why strategically positioned lenders will win the day Affordability remains the operative word. The housing supply shortage heavily impacts affordability.  A lack of new housing construction and limited existing home sale inventory contributed largely to the limited for sale stock. Lower interest rates can influence the affordability outlook, but rising inflation and the Federal Reserve not yet moving to lower rates has resulted in mortgage interest rates creeping upward this year.1 Additionally, overall economic indicators influence the housing market. While the Federal Reserve does not directly dictate mortgage interest rates, mortgage rates are influenced by the actions they take. Federal Reserve Chairman Jerome Powell’s recent remarks that the Fed will not likely lower rates until much later in the year due to inflation signals mortgage rates are unlikely to decrease soon.2 Mortgage lenders who dive into buyer behaviors, geographical nuances, and truly service these potential buyers will benefit. By employing market and buyer savvy strategies that resonate, you can drive both short and longer-term business growth. For more information about the lending possibilities for first-time homebuyers, read our latest white paper and visit us online. Download white paper Learn more 1 “Mortgage Rates Move Toward Seven Percent as Markets Digest Incoming Data,” freddiemac.com 2 “Federal Reserve Issues FOMC Statement,” March 20, 2024, federalreserve.gov

Financial institutions are constantly searching for ways to engage their consumers while providing valuable services that keep them financially sound and satisfied. At the same time, consumers are looking for ways to limit their risk and grow their financial power while improving and protecting their financial health. Here’s the good news: both can be accomplished through personalized financial experiences. But first, we need to explore why market conditions and consumer demand deem these experiences necessary. An uncertain market landscape leads to lower consumer financial confidence Volatile market conditions have caused consumer sentiment to decline. The United States (U.S.) Federal Reserve reported that bank deposits have dropped over $200B1 year over year, and experts are anticipating another drop soon. According to our recent State of the Economy Report, personal savings rates in the U.S. have dropped by 4.1% YoY2. And according to a Financial Health & Advice Satisfaction Study from J.D. Power, nearly a third of bank customers have moved deposits away from their primary banks.3 In addition, interest rates and lending standards are weighing heavily on originations, with slowdowns occurring across market segments. As a result, fewer consumers are opening new lines of credit, limiting their purchasing power and hindering revenue growth for financial institutions. These stats reveal evidence of an overall decrease in consumers’ economic power and confidence in financial institutions. However, these circumstances also present a unique opportunity for banks and lenders to stand out by offering high-value solutions that meet consumer demands. Consumers want financial protection and support In response to the constantly growing threat of identity theft, most consumers expect financial institutions to offer protective measures to help decrease their risk of identity theft and fraud. 57% of consumers want their primary bank to provide an identity protection solution, and when fraud occurs, consumers hold their banks accountable4. 58% of consumers say it’s not their responsibility to protect their own personally identifiable information, and 60% say their financial institution is responsible for making them whole again if identity fraud occurs.5 While consumers need identity protection, financial institutions need new ways to engage their customers and drive more revenue. Fortunately, offering identity protection and credit education is an effective way to maintain a sticky relationship with your customers while delivering an enhanced, engaging experience. Engaged consumers drive revenue The combination of identity protection and credit education solutions can have a positive impact on consumer engagement. Research shows that consumers who interact with financial management features spend more with their banks; a recent MX case study found that consumers opened twice as many credit cards and three times as many savings accounts when interacting with a bank’s financial management solutions6. This can lead to a potential 20% increase in revenue for financial institutions, according to a Global Banking Consumer Study from Accenture.7 Credit monitoring also plays an important role in bolstering consumer engagement. For example, credit alerts can lead to an average of 53% open rates and 75% post-alert login rates.8 In addition, financial management features can drive consumers to spend 3X more time in a bank’s financial app environment.9 These engaged consumers may have a greater potential to open more new accounts, borrow more, and remain loyal, long-standing customers. The key is to offer these solutions through personalized financial experiences. Getting started Join us on Thursday, May 30 as we share insights into monetizing personalized financial experiences through identity protection, credit education, and fraud protection and restoration. Get ready to learn the formula for how to: Increase upsell and cross-sell opportunities De-risk client portfolios Drive more wallet share Generate persona data Raise consumer credit limits Register now 1US savers get savvy ditching and switching banks, BBC, April 16, 20232State of the Economy Report, Experian®, June 20233J.D. Power Financial Health & Advice Satisfaction Study, 20234Javelin, 2022 Identity Fraud Study Shifting Angles5Javelin, 2022 Identity Fraud Study6MX Case Study Research, October 20227Accenture, Global Banking Consumer Study, Reignite Human Connections, August 20228Experian® D2C Financial Management reported as of May 20239Experian® Employee Benefits Financial Management as of May 2023

The world of finance can be a dangerous place, where cunning schemes lurk in the shadows, ready to pounce on unsuspecting victims. In the ever-evolving landscape of financial crime, the insidious ‘pig butchering’ scam has emerged as a significant threat, targeting both financial institutions and their clients. What is a ‘pig butchering’ scam? ‘Pig butchering’ scams are named after the practice of farmers fattening up their livestock before “butchering” them. This comparison describes the core of ‘pig butchering’ scams, where criminals entice victims to participate in investment schemes and cryptocurrency fraud. Originating in Southeast Asia and now rampant in the United States, these scams often start with online interactions via social media or dating applications. Scammers build trust with the victim, eventually gaining access to their online accounts. They "fatten the pig" by enticing more cryptocurrency investments and then make off with their ill-gotten gains. The repercussions are staggering, with reported losses exceeding $3.5 billion in 2023 alone according to an AP News article, and around 40,000 victims in the United States, including cases of losses as massive as $4 million. The real-life impact The story of “RB,” a San Francisco man who engaged with a scammer named "Janey Lee," serves as a stark warning. Through social media, Janey orchestrated an elaborate scheme, promising "RB” substantial returns in cryptocurrency investment. Seduced by false promises, “RB” emptied his life savings into the scam, only to be rescued by a Federal Bureau of Investigation (FBI) intervention, narrowly avoiding financial ruin.1 Malicious actors are improving their targeting skills, and often pursue executives and victims with a large sum of money, such as C-level officials from financial institutions. This past February, a $50 million pig slaughtering fraud incident caused the CEO of a local bank in Kansas to lose all his funds and the bank to collapse a few months later. FinCEN's vigilance and updates The Financial Crimes Enforcement Network (FinCEN) remains vigilant, issuing advisories to financial institutions to combat ‘pig butchering’ scams. Their latest advisory highlights evolving scam tactics, including aggressive promotions, using money mules for illegal fund transfers, and leveraging new financial products like decentralized finance (DeFi) platforms to obfuscate transactions. FinCEN also warns about red flags such as large and sudden investments from older customers, quick fund withdrawals after big deposits, and the frequent use of coins or mixers that hide transactions. Financial institutions are encouraged to: Report any suspicious activities by using specific terms like "pig butchering fraud advisory" in their reports to make analysis and response easier. File suspicious activity reports (SARs) using the key term “FIN-2023-PIGBUTCHERING.” Guide potential victims to report to the FBI’s IC3 or the Security and Exchange Commission (SEC’s) reporting system. A call to action for financial institutions The fight against ‘pig butchering’ scams requires proactive measures from financial institutions: Enhance fraud detection and anti-money laundering (AML) programs: Implement robust systems compliant with regulatory guidelines, conduct thorough customer enhanced due diligence, and leverage fraud detection software to spot anomalies and red flags., and leverage fraud detection software to spot anomalies and red flags. Leverage data analytics: Utilize data analytics tools to monitor customer behavior, identify irregular patterns, and swiftly detect potential ‘pig butchering’ activities. Employee training: Educate employees on scam risks, fraud detection techniques, and FinCEN red flags to empower them as the first line of defense., and FinCEN red flags to empower them as the first line of defense. Community education: Educate customers on recognizing and avoiding investment scams, promoting awareness, and safeguarding their assets. Navigating challenges with effective solutions ‘Pig butchering’ scams cause not only money losses but also personal troubles and reputational harm. Awareness, learning, and cooperation are essential in protecting from these complex financial fraudsters, securing the safety and confidence of your institutions and stakeholders. By combining the best data with our automated identification verification processes, you can protect your business and onboard new talents efficiently. Our industry-leading solutions employ device recognition, behavioral biometrics, machine learning, and global fraud databases to spot and block suspicious activity before it becomes a problem. Learn more 1San Francisco Chronical (2023). Crypto Texting Scam *This article includes content created by an AI language model and is intended to provide general information.