Hispanic homeownership is steadily on the rise but when it comes to mortgage lending, there are very few companies focusing on the Latino market, says one local industry expert.
Speaking to Pasadena Now, Dawar Alimi, CEO and co-founder of Pasadena-based software company Lender Price, said that lenders need to cater to the Latino community if they want to thrive in the coming years.
“Lenders must focus on the Hispanic market and recognize that Hispanic borrowers will eventually constitute the largest demographic of qualified borrowers in the country,” said Alimi.
His company, Lender Price, is used by lenders to determine how to manage products, programs and pricing for borrowers.
According to the 2020 State of Hispanic Homeownership Report of the National Association of Hispanic Real Estate Professionals, Latinos are the only demographic in the United States (U.S.) to increase their rate of homeownership in recent years.
In the 10 years leading up to the pandemic, Latinos accounted for over 50 % of homeownership growth in the U.S. and this trend is expected to accelerate for the next 20 years.
It is projected that between 2020 and 2040, 70% of new homeowners will be Latino.
According to Alimi, lenders should make an effort to connect with Hispanic borrowers “on a personal level” to understand their financial needs and objectives.
He said Latino consumers are extremely diverse in terms of country of origin, culture, language, and income levels.
As per Alimi, Hispanics also tend to be more family-oriented than other demographic groups. This means that they are likely to consider the needs and desires of their extended families when making financial decisions.
Alimi believes an increasing number of Hispanics will be buying homes in Pasadena and throughout the country in the future.
He also believes that more and more Latinos will be granted mortgage loans as he mentioned that some lenders such as Loan Depot and Alterra Home Loans, are now catering to the community.
“It is essential to remember that Hispanics are a growing and increasingly significant population in the United States. Consequently, lenders who fail to cater to this market may experience a competitive disadvantage in the coming years,” said Alimi.
According to a 2020 census survey, 34.9% of Pasadena’s population are Hispanic. 34.6% of the population are white and 17.9% of the population are Asian.