By Beth Snyder Bulik
Published: June 22, 2009

YORK, Pa. (From AdAge.com) -- Don't look now, but home-mortgage ads are back.

At least they are for Bank of America, whose latest TV spot shows vignettes of families perusing a single sheet of paper. The ad, for the newly renamed Bank of America Home Loans division, is focused on a one-page summary of a home loan's agreement terms.

 

The new work, under the theme "Clarity Commitment," is part of an overall rebranding campaign around the jettisoned Countrywide brand name (Bank of America acquired the beleaguered mortgage company last year). But the effort also pushes past the "Starting now, Bank of America has a new address" introduction and doubles as a home-loan ad.

 

"The downside for Bank of America is that people are still sensitive to the Countrywide connection, and [Bank of America] might not generate any business from the new ads. But, at the worst, they're still at least laying some kind of new brand foundation," said Jeffrey Pilcher, president of ICONiQ financial brand consultancy. "If you think there will be some sort of return to mortgages in the next 18 to 24 months, [and] you wait a year to start marketing, you'll be starting from scratch."

 

A Bank of America spokesman said the intent of the ads is not only to launch the new name and brand but also to help reinvent the mortgage industry with more transparency and more simplicity. The creative was done by BBDO, New York.

In the fourth quarter of 2008, mortgage originations totaled $278 billion, down 39% from the first quarter of 2008's $453 billion, according to data from the Mortgage Bankers Association. Mortgage lending was up again for the first quarter of 2009 to $443 billion, but 70% of that was attributed to refinancing.

 

Lingering fear

Guy Cecala, publisher and CEO of Inside Mortgage Finance, said the fear in the mortgage marketplace that will take years to settle may make a mortgage-marketing message a bit too early. "Several years ago, mortgage lenders were beating each other over the head with competitive marketing, and every lender had 150 products to sell. Now they have two or three plain-vanilla products and no one is looking to compete."

 

"Bank of America is unique in the fact that they're out there advertising that they're even doing mortgages," he said. "At least they're trying something, and that does make them stand out."

 

But whether the ads are too soon for consumers, the tone and tenor of the Bank of America work may reflect a permanent shift in the industry. And it's a long way from the old Countrywide slogan, "No one can do what Countrywide can," and ads that bragged it could make loans to people who had been turned down by other lenders.

So, while not surprising, the days of get-your-dream-house-just-because-you-want-it marketing may be over. "This is not unique to the mortgage industry. In all financial services, we're seeing marketing around institutions being a trusted adviser," said Greg McBride, senior analyst with Bankrate.com. "That's the tone we're going to see in marketing over the next couple of years."

 

The new messaging, coupled with some signs of relief in the housing downturn, could mean it's the right time to start marketing again. Economists from the American Bankers Association predicted last week that the three-year housing downturn will end in the third quarter.

 

Still, marketing spending will likely take time to catch up. Mortgage and home equity loan direct mailings are at historic lows, according to Mintel data. Mortgage mailing volume for the first quarter of 2009 was 97.5 million, a drop from 124 million in the previous quarter. In the third quarter of 2005, when the decline began, mailing volume hit a whopping high of 802 million.

 

Mr. McBride said the market will never return to the under-regulated, too-easy credit days, but don't count out a marketing resurgence. "When memories fade and when it's a more sane credit market ... lower interest rates, strong economic growth, population growth, and all those kind of magic factors could come together and suddenly the housing market is attractive again. So I could see the return of marketing then," he said.