Mortgage Refi Boom: 5 SMS Best Practices to Capitalize Without TCPA Fines

By the week ending October 17th, mortgage rates had dipped to the lowest in the last 12 months, around 6.27% for a 30-year fixed, a sign of the exploding refinancing market. According to the latest Mortgage Bankers Association (MBA) Weekly Applications Survey, refinance applications surged 4% week-over-week and are a staggering 81% higher than the same week last year.

This isn't just a blip; it's a golden opportunity for lenders to reengage past customers and borrowers whose equity is suddenly unlocked. With trillions in potential refi volume on the table, sales and marketing leaders have a prime opportunity to recapture lapsed leads from 2024's high-rate drought.

But here's the catch: 

Rushing into outreach campaigns with AI and Automation can be an easy click; however, rushing into outreach without compliance guardrails can lead to TCPA violations, skyrocketing opt-outs, and costly fines. The Telephone Consumer Protection Act (TCPA) doesn't mess around when it comes to SMS campaigns, especially in regulated industries like mortgages. 

The good news? You can harness the power of compliant text messaging to drive higher response rates, nurture warm leads, and close deals faster.

In this post, we'll recap the refi surge and break down five essential SMS best practices tailored for mortgage pros. Whether you're reengaging past borrowers to alert them to rate drops or automating appointment reminders, these strategies will keep you legal, engaging, and conversion-focused. Let's dive in.

Now's the Time for SMS Re-Engagement

Falling rates aren't just news—they're a catalyst. The MBA reports that the refinance share of total mortgage applications jumped to 55.9% last week, up from 53.6% the prior week, as homeowners scramble to lock in savings. Refi demand, ultra-sensitive to rate fluctuations, has skyrocketed 81% year-over-year, outpacing purchase applications, which dipped slightly. For mortgage lenders, this means dormant customer lists are now hot prospects. 

Imagine texting a 2023 borrower: 

"Hey [Name], rates just dropped to 6.27%—could save you $300/mo on your [Loan Type]. Reply YES for a quick quote?"

SMS open rates hover at 98%, and response times average under 3 minutes—far outperforming email. But to avoid "headaches," TCPA compliance is non-negotiable: explicit consent, clear opt-outs, and audited records are a must. Platforms like Botsplash make this seamless with built-in tools for segmentation, automation, and analytics.

Here are five best practices for launching your rate-drop campaigns safely and effectively. Get ready to turn data into dollars.

Best Practice 1: Obtain Explicit Opt-In Consent (TCPA 101)

No opt-in, no send—that's TCPA 101. Requiring clear, affirmative consent (e.g., "Text YES to receive rate alerts from [Your Company]") isn't just legally required; it filters for engaged recipients, slashing spam complaints by up to 70%.

Pro Tip for Refi: During original loan closings or website sign-ups, bundle SMS consent with value-adds like "Get instant rate drop notifications." Track consents in your CRM for easy audits. Result? Higher deliverability and trust—key when borrowers are rate-shopping.

Best Practice 2: Personalize Thoughtfully with Loan Data

Generic blasts scream "spam." Use loan data (name, original rate, property type) to craft hyper-relevant texts: "John, your 7.2% ARM could drop to 6.27%—saving $250/mo. Tap to refinance?"

Personalization boosts engagement by 2-3x, per industry benchmarks, and signals legitimacy under TCPA scrutiny. Botsplash's dynamic templates automatically pull from your database, ensuring every message lands like a tailored offer.

Best Practice 3: Segment Precisely by Loan Type and Geography

One-size-fits-all? Not in 2025. Divide your list by rate sensitivity (e.g., >7% loans), geography (state-specific regs), or behavior (recent site visitors). Send coastal borrowers hurricane-relief refi tips, while Midwest lists get equity-unlock alerts.

Precise segmentation cuts opt-outs by 40% and lifts conversions. With Botsplash, automate tags based on CRM data—no manual spreadsheets needed.

Best Practice 4: Provide Clear Opt-Out Instructions to Build Goodwill

Every SMS must end with "Reply STOP to opt out" or a similar message—it's a TCPA cornerstone. Make it frictionless to build goodwill and prove compliance.

Refi Hack: Pair opt-outs with a soft close: "Not ready? Reply LATER for weekly updates." This keeps doors open while respecting choices, reducing legal risks in high-volume campaigns.

Best Practice 5: Ensure Multi-State Regulatory Compliance

Beyond basics, audit for content rules (no misleading claims), timing (no 2 AM texts), and record-keeping. States like Florida add mini-TCPA layers—use geo-fencing to comply.

Botsplash shines here with automated flagging and consent logs. Proactively compliant campaigns aren't just safe; they're scalable.

The Bottom Line: Compliant SMS Drives Results

The MBA's 81% refi surge is a golden window for re-engagement. By implementing these five compliant SMS best practices, you can turn dormant lists into active pipelines without risking costly fines.

Compliant SMS via Botsplash boosts response rates 3x by ensuring your outreach is fast, personalized, and fully protected.

With Botsplash, you get:

• Centralized Dashboard and Smart Automation for ultimate efficiency.
• Reliable Message Scheduling and Detailed Analytics to keep deals on track.
• Automated Opt-in/Opt-out and Consent Tracking for built-in protection.

Schedule a demo today to automate your rate drop sequences and transform your mortgage outreach strategy.