What You Need To Have In Place For Compliant SMS Texting

Email has long been a staple of any mortgage lending operation’s marketing team. But as folks fine-tuned their email filters and stopped opening messages, some companies pivoted. They started sending texts.

Statistically speaking, this pivot makes sense. Texts have a much higher open rate than emails (98% vs. 28%, by one count), plus a click-through rate that’s nearly three times higher and a conversion rate that’s double that of email. 

In fact, this opportunity seemed so ripe for the picking that some companies leaned in too hard. If you’ve ever had your phone spammed by unwanted commercial texts, you know consumers’ pain. Last year, the Federal Communications Commission (FCC) stepped in to put a stop to these spammy texts.

That doesn’t mean the opportunity to leverage texting has gone away for mortgage lenders. In fact, it’s as good as ever before. But it does mean that if you’re going to be sending texts, you need to take steps to comply with the applicable federal regulation. 

Current regulation on SMS texting

Per current regulation, your company needs to register the ten-digit phone number (or ten-digit-long code [10DLC]) from which it will send application-to-person (A2P) messages. In other words, if you’re going to automate texts, you need to make sure the number from which you send them is properly filed with the appropriate mobile carrier, like AT&T, Verizon, or T-Mobile. If you don’t complete this A2P 10DLC registration, the carrier can block your texts. 

(Note that you don’t have to figure out this registration process alone. Our team, for example, works with an AI-enabled SMS text company that can register your company and your 10DLC on your behalf.) 

Beyond that, the number one most important thing you need to do is ensure that you have that person’s consent to receive texts from your company. A lot of mortgage lending institutions will include a check box at the end of a lead workflow to get that consent. Including a box the lead has to check saying, “Yes, I opt in to receive text messages and email communications” helps you be legally compliant. 

The first text in any campaign you send also needs to include opt-out information. It might say “Reply STOP to opt out of future texts” at the bottom, for example. 

Then, it’s critical that opt-in or opt-out information feeds to your CRM and stays updated. If you send texts and the lead opts out of receiving more, for example, your system needs to update so they stop getting texts from you. The right SMS texting platform can manage all of this for you, but it’s still important for you to know. That way, you can shop for these must-have features when you’re evaluating providers. 

Other best practices for SMS compliance

Beyond A2P 10DLC registry and opt-in/opt-out compliance, your lending institution should take additional measures here. Specifically, the experts at Verse and our team recommend:

• Understanding your TCR score. Your company will get assigned a TCR score, also called a trust score, when you register your A2P customer profile for 10DLC messaging. You can score anywhere between 0 and 100. An overly low score can limit how many texts you’re able to send each day. Anything above 50 is considered good and shouldn’t limit your texting capabilities. 
• Be diligent with first messages. The first message you send in any campaign is under extra scrutiny, both from the lead receiving it and regulators. As we mentioned before, it’s key that it clearly gives folks a way to opt out of future texts. But you should take additional steps to craft a message that is compelling and compliant. First messages that include links, for example, often look like spam, so you might want to save links for later messages. 
• Avoid spammy language. Think of phrases that could make your texts look like spam rather than a wanted, personalized communication. Phrases like “best price,” “lowest price,” and “great deal” can all be red flags, for example. The more you can make your texts look like genuine communication with trustworthy, helpful information — rather than a sales pitch or ad — the better.  
• Prioritize first party data. This is lead information your company has directly collected itself. While buying lists of phone numbers might be tempting, regulators are hinting that more rules are coming pertaining to this type of third-party data.
• Use a known litigator filter. Some individuals and companies are trying to catch non-compliant companies so they can bring legal action against them. This type of filter removes numbers that are known to belong to these kinds of litigators, protecting your company. 

A word on state laws

This guide overviews current federal regulation around SMS text marketing, but state laws might come into play, too. In some cases, those state-based regulations align with what’s already in place federally (i.e., making it illegal to text without getting express consent first). In others, if that number is on the state’s Do Not Call registry, that protection extends to texts as well as calls.

Look into texting laws in your state to ensure you comply with any regulation that could apply to your mortgage lending company. 

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Clearly, there’s a lot to consider here. If you want to learn more about unlocking more mortgage lead conversions with SMS texting, this webinar is a great place to start. During it, we talked with the team at Verse, an AI-enabled SMS platform. We explored SMS text compliance in light of the latest laws, plus where the Verse team has been seeing lending institutions win big with this form of marketing automation. 

And if you want to talk with our team about how to unlock the benefits of AI-powered SMS text marketing while complying with federal regulations, we’re here. Book a demo with us and we can show you what texting can do. We’re here to help you maximize this powerful mortgage marketing opportunity while adhering to all the applicable laws around it. And we can connect you with Verse, which has a carrier relations team and can audit your campaigns to check for compliance. 

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