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For Home Buyers, JPMorgan Offers a Dose of Reality (Television)

James Langford

One of the top reasons people take out home equity loans is to make their living space more livable, whether it's by adding a swimming pool or replacing a leaky roof.

Which is why it makes sense for the stars of a reality television show famous for home upgrades to team with one of the biggest U.S. mortgage lenders, JPMorgan Chase on promoting a business that not only finances home purchases but offers loans against the ownership stake that borrowers build up over time.

Drew and Jonathan Scott, the twins who star in HGTV's Property Brothers, will be featured in digital, social media, display and television ads for Chase mortgages throughout the year, said Amy Bonitatibus, the business's chief marketing officer.

The spots capitalize on the brothers' growing reputation as social influencers; their HGTV show, which started in 2011, spawned multiple spinoffs as well as an outdoor furniture line for home-shopping cable channel QVC.

It's not the first time Chase has employed such a strategy: The Scotts join a lineup of celebrities promoting the bank's consumer businesses, from basketball star Stephen Curry to fencer Tim Morehouse and tennis champion Serena Williams.

"More and more, when you talk with friends and neighbors about home-buying, people immediately ask if you've seen the latest episode of the Property Brothers," Bonitatibus said in a telephone interview. 

On the show, Drew Scott's background as a real estate agent complements his twin's 15 years of experience as a licensed contractor; it's a double threat that's equally relevant to Chase's market.

"There are clear synergies between our two brands as we look to help people find, buy, and fix-up their dream home," Drew Scott said in a statement.

 

Home equity loans for those kinds of projects were difficult to obtain in the immediate aftermath of the 2008 financial crisis, when housing values plummeted and many homeowners found themselves owing more than their dwellings were worth.

Now, "we're seeing many of our customers interested in tapping into the equity in their homes," Bonitatibus said. "A lot of people sat on the sidelines for years wanting to make improvements but not having the value in their homes to do so, and now they do."

Analysis of Web traffic shows a stream of people looking up videos on renovations such as retiling a bathroom or overhauling a kitchen, she noted, which ties in well with Jonathan Scott's expertise as a home-improvement contractor. 

"With rates still low, it's the perfect time to consider those types of changes and improvements, Bonitatibus said.

Last year alone, growth of 40% drove Chase's new home-equity loans to $7 billion, outpacing gains of 23% in first-time mortgages that the bank underwrote itself, Mike Weinbach, the head of the business, said at JPMorgan's investor day in late February.

This year, the overall mortgage origination market may shrink as much as 25%, Weinbach predicted, as fewer customers seek to refinance after two rate hikes by the Federal Reserve made that option more expensive than the original loan.

"While the near-term environment may provide some headwinds, we're going to continue to invest and expect to be well-positioned to compete for the long run," he added. "There is no purchase which is bigger, more meaningful, more emotional for our customers than their home."

Along with its new marketing campaign, JPMorgan is testing a digital app developed with Silicon Valley fintech firm Roostify that will allow home borrowers to check where their application stands, securely upload documents and sign them electronically.

"This is something that we think will be table stakes for mortgage originations in the years to come," Weinbach said. "It provides our customers the ability to access their mortgage anytime, anywhere from any device."

From left, Robin Thomas of Chase Mortgage works with Jonathan Scott and Drew Scott on a commercial shoot.

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