Banks acquiring mortgage banking companies constantly harp on their desire to cross-sell other products. While I understand this desire, I also believe that lenders are grossly underutilizing the tools they have to cross-sell.

It seems that for most lenders, cross-selling to mortgage borrowers involves stuffing monthly coupon envelopes with a piece touting Visa cards or a possible auto loan.

This shotgun approach may work. But I believe that lenders can do much more.

The cliche in our business is that you never know more about a borrower than the day his loan closes. You have a current credit report, you know his age, the number and ages of his children, what financial assets he has, the number of his cars and how old they are, and so on.

If we have all this information, why don't we use it? Why can't lenders get away from shotgunning these borrowers and do targeted marketing?

Lenders should take all this information on the borrower and sort it according to specific product lines. It should be broken down and sent to the appropriate departments handling these specific lines. Borrowers could then be targeted for products appropriate to their specific situation and possible needs.

If the borrower's loan application shows that he has a 17-year-old daughter, it is quite likely that he is thinking about college costs. That borrower should get a mailing piece - and perhaps a phone call - discussing the institution's student loans.

Let's take a 63-year-old widow with two Visa cards with zero balances. She is probably not interested in getting one more credit card. She may be interested, however, in certain retirement or health insurance products. Yet the mailer that gets stuffed into the envelope with her mortgage payment coupon is, once again, pushing credit cards.

If a borrower has a one-year-old, he is probably already thinking about how much he'll need to save to be able to send his child to college in 17 years. That borrower could get targeted mailings geared to college savings plans.

If the borrower's application shows that he has two cars, both of them over, say, 10 years old, it is quite possible that he is thinking about buying a new car. Why not mail him something about your auto loan program?

If his application shows that almost all of his savings are in bonds, an investment counselor might contact him about diversifying. If he has no insurance, he could be targeted for that.

At the end of each month, lists could be sent to various departments showing every borrower who might have a need for that department's product.

At the end of the month, the auto loan department would get a list of every borrower owning one or more cars over 10 years in age. The student loan department would get a list of all borrowers with children between the ages of l7 and 23.

We could go on and on. It is simply a matter of disassembling a borrower's application, segmenting the vast amount of information we know about him, and routing that information to the appropriate department.

Marketing pieces can be included with a monthly coupon or sent separately. I am not interested in arguing one position over another The important thing is that lenders start to truly take advantage of the information they have on their borrowers. This is an area where our industry has much room for improvement.

Mr. Garret is president of American Liberty Mortgage Corp. in Lafayette, Calif.

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