Being a salesperson is never easy. To sell effectively, you must to be willing to do things that challenge you. No top producer has ever reached the upper ranks without first moving outside their comfort zone.
Someone recently sent me this poem and I wanted to share it with you. I hope it inspires you to keep challenging yourself and be willing to do whatever it takes to succeed.
No one ever said that sales was easy, but a little bit of inspiration never hurt either!
From one friend to another, here is the poem…
Comfort Zone
(Author Unknown)
I use to have a Comfort Zone
Where I knew I couldn't fail
The same four walls of busy work
Were really more like jail.
I longed so much to do the things
I'd never done before,
But I stayed inside my Comfort Zone
And paced the same old floor
I said it didn't matter,
That I wasn't doing much
I said I didn't care for things
Like diamonds, furs and such
I claimed to be so busy
With the things inside my zone,
But deep inside I longed for
Something special of my own.
I couldn't let my life go by,
Just watching others win.
I held my breath and stepped outside
And let the change begin.
I took a step and with new strength
I'd never felt before,
I kissed my Comfort Zone "goodbye"
And closed and locked the door.
If you are in a Comfort Zone,
Afraid to venture out,
Remember that all winners were
At one time filled with doubt.
A step or two and words of praise,
Can make your dreams come true.
Greet your future with a smile,
Success is there for you!
Monday, March 31, 2008
Friday, March 28, 2008
How To Choose A Mortgage Netbranch When Starting Your Own Mortgage Company
In my last article, I covered the two main ways to start your own mortgage company. One way, was to go it completely alone…apply for your own broker’s license, set-up all the relationships with the various lenders, handle all the back office stuff like accounting, compliance, etc. All of this, giving you your independence, but being extremely time consuming.
An easier and more productive way for the loan officer wanting to go on their own, is to join an existing company and operate their own individual “net branch”. It’s where you are working under a head-office, but operating as an individual with all the perks and privileges that go along with independence, but without a lot of the chores and headaches associated with a start-up company. A net branch is simply a way of doing business.
Net branching is a term that is very loosely thrown around the industry, and not every partnership opportunity a company offers is a true “net branch”. Please be careful.
Mortgage companies net branch because it is a way for them to expand their sales force with very little cost or financial risk. Because you are working solely on commission, they don’t have to pay a salary. And, if you don’t produce, you won’t last. Only the strongest will survive. It’s as simple as that!
Companies also already have the structure, compliance, auditing and lender relationships set in place. To add a new salesperson or branch, takes little time and can mean a new on-going revenue source for the firm.
Since the start of the low interest rate boom, companies have recognized that net branching is a smart and viable solution to expansion, especially when adding new states to their lending roster.
Here are the top reasons why loan officers decide to branch-out on their own:
1. They want more commission. They are sick of doing all the work, and getting a measly pay split. They want financial independence.
2. They want more control over their career. They are sick of being micro-managed and controlled by the boss.
3. They want their time back. They have other life obligations and want to spend more time with their family doing the things they enjoy. They are sick of the long hours and late nights.
4. They are emotionally drained and tired of all the office politics. They want to “choose” the people they deal and work with.
5. They are sick of being a robot. They want to fully use all their skills and knowledge and remain challenged in their career. In essence, they want creative and personal freedom.
Here are the advantages of joining a net branch:
1. Better pricing on rates, due to the volume of loans the company as a whole originates. Remember, although you are a single net branch, you have the buying power of thousands of other net branches that are within the company.
2. Greater depth of loan programs. With access to more lenders, you can offer more programs to the consumer and cover virtually any loan scenario.
3. Higher commission payment, usually in the 70% to 80% range, sometimes 90% to almost 100%.
4. Ability to originate loans in multiple states, even all 50! This means more loans for you! Don’t throw those out-of-state leads away!
5. No accounting or compliance headaches to deal with. The head office has these structures already in place. This leaves you more time for selling.
6. More attention from the wholesale account executive. Account reps know that if they are dealing with a large firm, they will get more business. They don’t want to waste their time dealing with the small fries.
7. Ready marketing materials. You do not have to start from scratch and create your own marketing collateral and brochures.
8. Licensing and start-up requirements from the state are significantly less, because there is an operating mortgage firm already underway.
9. You have the resources of the head office, as well as other local net branches. This forms a significant support network, which should not be underestimated.
10. Freedom to make your own schedule and call your own shots. You are in the driver’s seat and if you want to earn more income, simply work harder. No one is holding you back from your career.
11. You can multiply your efforts by hiring loan officers underneath you, and get a cut of THEIR commission as well.
Disadvantages of joining a net branch are:
1. You still must follow the company’s internal rules. You are technically an “employee” of theirs, and at their mercy.
2. Are they really telling you the whole story upfront? Will you be hit with any company surprises down the road?
3. Once you join a net branch you can’t easily jump and join another one.
4. You can’t choose the mortgage company name, you have to use their name. Also their logo, business cards, marketing materials, etc.
5. You may feel isolated by not having an office to go to, as most net branches are operated out of the loan officer’s home. And, if you do choose to rent an office, that’s an expense you must pay for.
6. People may not always be accessible or return phone calls when you have a question.
7. Some net branches have minimum sales requirements, and will fire you if you do not meet their sales goals.
8. Expect to do a lot of the loan processing yourself. After all, you are working solo now. Or, if you don’t want to do processing, expect to hire someone to do the work. Again, another expense.
9. Most net branches don’t offer health benefits. Some say they do, but when you read the fine print, they have 1 or 2 year timeframes you must be with the firm first. Or, they don’t cover all states. Mostly, it’s just the run around. So, make sure you get on your spouse’s health plan before you make the jump. Or shop around for personal health coverage.
Before deciding to join a net branch, here are some personal questions to consider:
1. Are you financially ready? Can you live off your current savings while your new branch is getting set-up? How much are your personal living expenses? What future expenses are likely to come-up?
2. Are there any business start-up costs? What are the fees upfront that must be paid before you can begin? Things like individual state licensing, setting-up a reserve account, office expenses etc. are costs that are borne by the individual loan office NOT the net branch.
3. Do you have a support network in place? Will your family support your efforts in your new business? Who will you turn to when things get rough?
4. Who is your competition? If you are leaving a local firm, mostly likely your former employer will be your fiercest competitor.
5. Did you sign a non-compete clause with your current mortgage firm? Check you’re your attorney. Although, not entirely legal in all states, companies will use this as a way to brow-beat you into submission. You can’t be stopped from earning a living. Don’t let them stop you from your dream.
Remember, going it alone comes with a price; and one which should be carefully considered. There are advantages and disadvantages of starting your own firm. In the end, a net branch is simply a way of doing business. It’s a conduit by which you can originate and close loans. Net branching is a great way to have the freedom and independence of your own mortgage firm, but with significantly less risk.
So, go ahead and give yourself an instant promotion this year. Consider net branching, but look carefully before you leap.
An easier and more productive way for the loan officer wanting to go on their own, is to join an existing company and operate their own individual “net branch”. It’s where you are working under a head-office, but operating as an individual with all the perks and privileges that go along with independence, but without a lot of the chores and headaches associated with a start-up company. A net branch is simply a way of doing business.
Net branching is a term that is very loosely thrown around the industry, and not every partnership opportunity a company offers is a true “net branch”. Please be careful.
Mortgage companies net branch because it is a way for them to expand their sales force with very little cost or financial risk. Because you are working solely on commission, they don’t have to pay a salary. And, if you don’t produce, you won’t last. Only the strongest will survive. It’s as simple as that!
Companies also already have the structure, compliance, auditing and lender relationships set in place. To add a new salesperson or branch, takes little time and can mean a new on-going revenue source for the firm.
Since the start of the low interest rate boom, companies have recognized that net branching is a smart and viable solution to expansion, especially when adding new states to their lending roster.
Here are the top reasons why loan officers decide to branch-out on their own:
1. They want more commission. They are sick of doing all the work, and getting a measly pay split. They want financial independence.
2. They want more control over their career. They are sick of being micro-managed and controlled by the boss.
3. They want their time back. They have other life obligations and want to spend more time with their family doing the things they enjoy. They are sick of the long hours and late nights.
4. They are emotionally drained and tired of all the office politics. They want to “choose” the people they deal and work with.
5. They are sick of being a robot. They want to fully use all their skills and knowledge and remain challenged in their career. In essence, they want creative and personal freedom.
Here are the advantages of joining a net branch:
1. Better pricing on rates, due to the volume of loans the company as a whole originates. Remember, although you are a single net branch, you have the buying power of thousands of other net branches that are within the company.
2. Greater depth of loan programs. With access to more lenders, you can offer more programs to the consumer and cover virtually any loan scenario.
3. Higher commission payment, usually in the 70% to 80% range, sometimes 90% to almost 100%.
4. Ability to originate loans in multiple states, even all 50! This means more loans for you! Don’t throw those out-of-state leads away!
5. No accounting or compliance headaches to deal with. The head office has these structures already in place. This leaves you more time for selling.
6. More attention from the wholesale account executive. Account reps know that if they are dealing with a large firm, they will get more business. They don’t want to waste their time dealing with the small fries.
7. Ready marketing materials. You do not have to start from scratch and create your own marketing collateral and brochures.
8. Licensing and start-up requirements from the state are significantly less, because there is an operating mortgage firm already underway.
9. You have the resources of the head office, as well as other local net branches. This forms a significant support network, which should not be underestimated.
10. Freedom to make your own schedule and call your own shots. You are in the driver’s seat and if you want to earn more income, simply work harder. No one is holding you back from your career.
11. You can multiply your efforts by hiring loan officers underneath you, and get a cut of THEIR commission as well.
Disadvantages of joining a net branch are:
1. You still must follow the company’s internal rules. You are technically an “employee” of theirs, and at their mercy.
2. Are they really telling you the whole story upfront? Will you be hit with any company surprises down the road?
3. Once you join a net branch you can’t easily jump and join another one.
4. You can’t choose the mortgage company name, you have to use their name. Also their logo, business cards, marketing materials, etc.
5. You may feel isolated by not having an office to go to, as most net branches are operated out of the loan officer’s home. And, if you do choose to rent an office, that’s an expense you must pay for.
6. People may not always be accessible or return phone calls when you have a question.
7. Some net branches have minimum sales requirements, and will fire you if you do not meet their sales goals.
8. Expect to do a lot of the loan processing yourself. After all, you are working solo now. Or, if you don’t want to do processing, expect to hire someone to do the work. Again, another expense.
9. Most net branches don’t offer health benefits. Some say they do, but when you read the fine print, they have 1 or 2 year timeframes you must be with the firm first. Or, they don’t cover all states. Mostly, it’s just the run around. So, make sure you get on your spouse’s health plan before you make the jump. Or shop around for personal health coverage.
Before deciding to join a net branch, here are some personal questions to consider:
1. Are you financially ready? Can you live off your current savings while your new branch is getting set-up? How much are your personal living expenses? What future expenses are likely to come-up?
2. Are there any business start-up costs? What are the fees upfront that must be paid before you can begin? Things like individual state licensing, setting-up a reserve account, office expenses etc. are costs that are borne by the individual loan office NOT the net branch.
3. Do you have a support network in place? Will your family support your efforts in your new business? Who will you turn to when things get rough?
4. Who is your competition? If you are leaving a local firm, mostly likely your former employer will be your fiercest competitor.
5. Did you sign a non-compete clause with your current mortgage firm? Check you’re your attorney. Although, not entirely legal in all states, companies will use this as a way to brow-beat you into submission. You can’t be stopped from earning a living. Don’t let them stop you from your dream.
Remember, going it alone comes with a price; and one which should be carefully considered. There are advantages and disadvantages of starting your own firm. In the end, a net branch is simply a way of doing business. It’s a conduit by which you can originate and close loans. Net branching is a great way to have the freedom and independence of your own mortgage firm, but with significantly less risk.
So, go ahead and give yourself an instant promotion this year. Consider net branching, but look carefully before you leap.
Tuesday, March 25, 2008
Be Thankful As A Loan Officer For The Mortgage Industry Shake-Up
I got a call from a loan officer in Lansing, Michigan recently and he called to tell me that he was an avid reader of my newsletter but was giving-up and throwing in the towel. He said he was burnt-out, tired of chasing realtors, and dealing with customers that play games. He had had enough!
When I asked him what lead to his decision, he said that he had only been in the industry for about a year, and had to learn everything himself along the way, but didn’t feel confident in himself because he wasn’t closing many loans. He said that business became a lot tougher and more cut-throat and he just couldn’t compete with everyone else out there. (His wife was all on him too!)
When I asked him why he had gotten into mortgages, he said he did it because he heard that there was “big money to be made” and he figured a couple loans under his belt would be more than he made in a year. He said he always had a passing interest in “real estate” but had never bought or sold a home before and didn’t know much about the finance side of things. He quickly found-out how complex and difficult this business is.
I had little sympathy for him. With chasing “big money” and having absolutely no training whatsoever, it’s no wonder he didn’t succeed. He got into mortgages for the wrong reason—to chase a golden ticket. Not, because he was passionate and wanted to help people.
Yes, this business is difficult, but it’s the easiest job in the world once you know what to do. (We were all new at one point!) No other industry is so step-by-step and logical. On every deal, you know the end result—close the loan. But, how you get there is where the challenge lies, and why people thrive in this business! They love the challenge and the rewards that come every day. It’s exciting!
Over the past few years, mortgage ranks have swollen from 180,000 to over 300,000 people in the industry. That’s a whole lot of people who have only known the golden days of the refi-boom. They know how to be an order-taker not a loan officer.
People who have been around for 10 years or more know what it means to ORIGINATE a loan. It means marketing yourself aggressively, building a reputation and generating a steady stream of referrals. They’ve seen high rates and low rates and they know that this too will pass. In another 8 to 10 years, rates will start to go down again, and they’ll be well prepared to take advantage of the next interest cycle. Veteran producers aren’t giving-up. Neither should you. Decide now if you have the guts and determination to stick-it out. Do you have a passion for what you do?
Be thankful for the shake-up because it means that a whole lot of unskilled loan officers will go the way of the dodo bird and stop ruining the reputation of the industry. And it means a whole lot more business for you!
When I asked him what lead to his decision, he said that he had only been in the industry for about a year, and had to learn everything himself along the way, but didn’t feel confident in himself because he wasn’t closing many loans. He said that business became a lot tougher and more cut-throat and he just couldn’t compete with everyone else out there. (His wife was all on him too!)
When I asked him why he had gotten into mortgages, he said he did it because he heard that there was “big money to be made” and he figured a couple loans under his belt would be more than he made in a year. He said he always had a passing interest in “real estate” but had never bought or sold a home before and didn’t know much about the finance side of things. He quickly found-out how complex and difficult this business is.
I had little sympathy for him. With chasing “big money” and having absolutely no training whatsoever, it’s no wonder he didn’t succeed. He got into mortgages for the wrong reason—to chase a golden ticket. Not, because he was passionate and wanted to help people.
Yes, this business is difficult, but it’s the easiest job in the world once you know what to do. (We were all new at one point!) No other industry is so step-by-step and logical. On every deal, you know the end result—close the loan. But, how you get there is where the challenge lies, and why people thrive in this business! They love the challenge and the rewards that come every day. It’s exciting!
Over the past few years, mortgage ranks have swollen from 180,000 to over 300,000 people in the industry. That’s a whole lot of people who have only known the golden days of the refi-boom. They know how to be an order-taker not a loan officer.
People who have been around for 10 years or more know what it means to ORIGINATE a loan. It means marketing yourself aggressively, building a reputation and generating a steady stream of referrals. They’ve seen high rates and low rates and they know that this too will pass. In another 8 to 10 years, rates will start to go down again, and they’ll be well prepared to take advantage of the next interest cycle. Veteran producers aren’t giving-up. Neither should you. Decide now if you have the guts and determination to stick-it out. Do you have a passion for what you do?
Be thankful for the shake-up because it means that a whole lot of unskilled loan officers will go the way of the dodo bird and stop ruining the reputation of the industry. And it means a whole lot more business for you!
Saturday, March 22, 2008
How To Approach “For Sale” Properties As A Lead Generation Strategy
POSTCARD MARKETING IDEA
“Here is a quick marketing idea you can use immediately to generate new business. Send a postcard to all the new property for sale listings in your area (whether they are on MLS or are FSBO’s from the newspaper).
Often times, the person selling the property hasn't yet lined up financing for the "new" property they are buying. And this is a great way to get new purchase loans lined-up early and fill your pipeline. Realtors have been “double dipping” on commissions for years, selling one house and getting another commission on the new deal. If they can kill two birds with one stone, so can you!
Combine this pro-active postcard technique with your own lead generation site and you’d have a killer combination. Certainly something to consider in this competitive rate environment.”
---------
A got a lot of emails back, asking what to put on the postcards to get attention. Here a few great headlines you can use in your marketing copy.
* Before You Sell Your Home, How Do You Know You Can Afford Your Next One?
* How Soon Do You Want To Close On Your Next Home?
* If You Are Having Trouble Selling Your Home, Wouldn’t It Make Sense To Get Potential Buyers Pre-Qualified First?
* How Much Time Are You Spending With People Who Won’t Buy?
* Can You Afford To Take A Chance That Your Home Won’t Sell In Time?
* Will Your Dream Home Still Be Available By The Time Your Financing Is Set Up?
* How Soon Do You Want To Close On Your Next Home?
* A Little Birdie Told Me You Were Selling Your Home, Do You Know What Your Next Move Will Be?
* If You Don’t Take Control Of Your New Home, Who Will?
Notice, that all of the headlines are leading, asking questions which cause the person to stop and think. Also, never, ever use the words “property” or “house”. You always want to use “home”. It’s powerful. It’s emotional. And it’s where the heart is. ;-)
Postcards are effective because they are inexpensive, short and to the point . Even if they are thrown away, your marketing message is STILL seen. Run this campaign over several months, with several headlines to the same prospects and it will be impossible for them not to notice. Repetition breeds action. And action breeds business.
I would also advise offering a special report or other incentive to increase your response rate. Having a loan pricing website would also help, similar to the one I have at http://www.FindTheLowestRate.com You want something that isn’t a “corporate” image site but rather one which captures the prospect’s information so you can later follow-up with them and convert them into a customer.
Give this low-cost marketing technique a try today and you’ll write more loans this month.
“Here is a quick marketing idea you can use immediately to generate new business. Send a postcard to all the new property for sale listings in your area (whether they are on MLS or are FSBO’s from the newspaper).
Often times, the person selling the property hasn't yet lined up financing for the "new" property they are buying. And this is a great way to get new purchase loans lined-up early and fill your pipeline. Realtors have been “double dipping” on commissions for years, selling one house and getting another commission on the new deal. If they can kill two birds with one stone, so can you!
Combine this pro-active postcard technique with your own lead generation site and you’d have a killer combination. Certainly something to consider in this competitive rate environment.”
---------
A got a lot of emails back, asking what to put on the postcards to get attention. Here a few great headlines you can use in your marketing copy.
* Before You Sell Your Home, How Do You Know You Can Afford Your Next One?
* How Soon Do You Want To Close On Your Next Home?
* If You Are Having Trouble Selling Your Home, Wouldn’t It Make Sense To Get Potential Buyers Pre-Qualified First?
* How Much Time Are You Spending With People Who Won’t Buy?
* Can You Afford To Take A Chance That Your Home Won’t Sell In Time?
* Will Your Dream Home Still Be Available By The Time Your Financing Is Set Up?
* How Soon Do You Want To Close On Your Next Home?
* A Little Birdie Told Me You Were Selling Your Home, Do You Know What Your Next Move Will Be?
* If You Don’t Take Control Of Your New Home, Who Will?
Notice, that all of the headlines are leading, asking questions which cause the person to stop and think. Also, never, ever use the words “property” or “house”. You always want to use “home”. It’s powerful. It’s emotional. And it’s where the heart is. ;-)
Postcards are effective because they are inexpensive, short and to the point . Even if they are thrown away, your marketing message is STILL seen. Run this campaign over several months, with several headlines to the same prospects and it will be impossible for them not to notice. Repetition breeds action. And action breeds business.
I would also advise offering a special report or other incentive to increase your response rate. Having a loan pricing website would also help, similar to the one I have at http://www.FindTheLowestRate.com You want something that isn’t a “corporate” image site but rather one which captures the prospect’s information so you can later follow-up with them and convert them into a customer.
Give this low-cost marketing technique a try today and you’ll write more loans this month.
Wednesday, March 19, 2008
Another Way To Kick People Off Mortgage Rate And Capture Their Business As A Loan Officer
How many times have you answered the phone and heard “What’s your rate?” from a customer? I guarantee it comes-up on every phone call, usually within the first 30 seconds of the conversation. Customers ask it because they don’t know any better. To them you are just like every other loan monkey out there. They don’t care about you, they just care about THEIR interest rate they’re going to get and that’s all that want to know. Anything else you say is in one ear and out the other.
But you the loan officer, don’t care about the rate. Your concern is trying to figure out the customer and seeing what loan program you can get them into. You care about their property type, loan amount, FICO score, etc. Then after all this is said and done, the rate then becomes of INTEREST to you. ;-) But the customer doesn’t care about all that!!! They just want the rate! Now won’t you just give it to them, so they can hang-up and call someone else? You know what will happen…POOOOOFFFF! THEY’RE GONE!
One of the best ways I’ve found to steer a customer off of rate…rate…rate is to ask open-ended questions. No longer am I just asking about the property type and loan amount, but rather asking if they would like to take cash-out of the property, how long they intend to stay there, what their future plans are and so on.
I ask questions other loan officers don’t and it helps me to get in touch with my customers true internal motivation. No longer am I an order taker, the customer now sees me as a helpful friend and trusted advisor. In today’s competitive marketplace, this is truly the best hassle-free way to sell. It really works…works…works!
Here are some open-ended questions you can use to get the customer to open-up to you, creating trust and minimizing the “rate” question:
* What timeframes are we looking at for this loan?
* Do you know what type of program you might be interested in?
* Have you been shopping for a while?
* What kind of property are you buying, tell me a bit more about it? (People love to talk about their new home!!!)
* How long do you intend to stay in the property?
* Have you done any remodeling on the house which may increase it’s value? (Again, this has little to do with the actual loan pricing, but is a great conversation starter and trust builder as Mr. Handyman can tell you about all the wonderful projects he’s done, etc.)
* What are your long term goals and plans?
* Do you know what your credit score is, and what’s on your credit report?
* Haven’t you heard horror stories of people being burned at the closing table?
* Have you considered rolling any other debt into the mortgage in order to lower payments and save money on interest?
* Has anyone ever told you what a true “no closing cost” loan is?
* Has anyone ever explained the loan process to you step-by-step?
* Have you had any problems in getting a loan in the past?
* Is there anyone else involved in the mortgage or is it just yourself?
* How soon would you like to close by?
* And my favorite question, “Have you seen any other rates you liked?” (this tells me if they are a hard-core shopper or not and lets me know what I am up against).
These are just some of the questions to get the customer to tell you their “story” and open-up. (I cover hundreds of questions in my training at http://www.loanclosingsystem.com ). It is important to ask questions that don’t have a firm yes or no answer. The sooner you get people off rate, the more likely you are to capture their business and close their loan. The next time someone calls, try using one or more of my open-ended questions above and you’ll see the difference! The results will amaze you!
But you the loan officer, don’t care about the rate. Your concern is trying to figure out the customer and seeing what loan program you can get them into. You care about their property type, loan amount, FICO score, etc. Then after all this is said and done, the rate then becomes of INTEREST to you. ;-) But the customer doesn’t care about all that!!! They just want the rate! Now won’t you just give it to them, so they can hang-up and call someone else? You know what will happen…POOOOOFFFF! THEY’RE GONE!
One of the best ways I’ve found to steer a customer off of rate…rate…rate is to ask open-ended questions. No longer am I just asking about the property type and loan amount, but rather asking if they would like to take cash-out of the property, how long they intend to stay there, what their future plans are and so on.
I ask questions other loan officers don’t and it helps me to get in touch with my customers true internal motivation. No longer am I an order taker, the customer now sees me as a helpful friend and trusted advisor. In today’s competitive marketplace, this is truly the best hassle-free way to sell. It really works…works…works!
Here are some open-ended questions you can use to get the customer to open-up to you, creating trust and minimizing the “rate” question:
* What timeframes are we looking at for this loan?
* Do you know what type of program you might be interested in?
* Have you been shopping for a while?
* What kind of property are you buying, tell me a bit more about it? (People love to talk about their new home!!!)
* How long do you intend to stay in the property?
* Have you done any remodeling on the house which may increase it’s value? (Again, this has little to do with the actual loan pricing, but is a great conversation starter and trust builder as Mr. Handyman can tell you about all the wonderful projects he’s done, etc.)
* What are your long term goals and plans?
* Do you know what your credit score is, and what’s on your credit report?
* Haven’t you heard horror stories of people being burned at the closing table?
* Have you considered rolling any other debt into the mortgage in order to lower payments and save money on interest?
* Has anyone ever told you what a true “no closing cost” loan is?
* Has anyone ever explained the loan process to you step-by-step?
* Have you had any problems in getting a loan in the past?
* Is there anyone else involved in the mortgage or is it just yourself?
* How soon would you like to close by?
* And my favorite question, “Have you seen any other rates you liked?” (this tells me if they are a hard-core shopper or not and lets me know what I am up against).
These are just some of the questions to get the customer to tell you their “story” and open-up. (I cover hundreds of questions in my training at http://www.loanclosingsystem.com ). It is important to ask questions that don’t have a firm yes or no answer. The sooner you get people off rate, the more likely you are to capture their business and close their loan. The next time someone calls, try using one or more of my open-ended questions above and you’ll see the difference! The results will amaze you!
Sunday, March 16, 2008
How To Create A Lead Generating Mortgage Website In Record Time
You have three choices you have in getting your mortgage site up and running. To recap, they are:
1. Go it alone and design it yourself.
2. Hire a web design firm to custom build a mortgage site for you.
3. Use a ready-made instant website from a design company that specializes just in the mortgage industry.
My suggestion was that your time is far too limited to waste on trying to go it alone, and your money is far too valuable to spend on hiring a web design firm to custom build a site for you. Your best option is number 3, using one of the ready-made instant websites from a company specializing in the mortgage industry.
Here is my list of some of the best firms out there, and ones you should consider before making a decision.
READY-MADE INSTANT MORTGAGE WEBSITE PROVIDERS:
* LoanBright.com
* FireComm.com
* FreeLOWebsites.com
* Avicy.com
* DigitalOrigination.com
* FindTheLowestRate.com
Any of these firms can provide you with a very professional looking site and help you create the company image you are looking for. Although pricing and services vary, be sure to evaluate each to determine the type of features you want your website to have. Things such as an online 1003 application, rate alerts, and newsfeeds can add a tremendous amount of interactivity to your site and get prospects to return again and again (because of the updated information).
One additional website you might want to consider is my FindTheLowestRate.com site. Although it isn’t a “company” oriented site, it’s purpose is solely to help you generate leads. You can learn more at:
http://findthelowestrate.com/leadsite.htm
I always tell my clients that you should have two websites at a minimum, maybe more. One site to create your company image, and one to act as a lead generation source. Of course, your company site will generate leads as well, but having a separate site whose sole purpose is lead generation can put you head and shoulders above all the other “me-too” mortgage firms out there. To attract hard-core rate shoppers and purchase-loan customers, this is an absolute must!
Review all your website options, set a firm goal and make a decision. Only by putting a stake in the ground and beginning where you stand, will you be able to reach your sales goals this year.
1. Go it alone and design it yourself.
2. Hire a web design firm to custom build a mortgage site for you.
3. Use a ready-made instant website from a design company that specializes just in the mortgage industry.
My suggestion was that your time is far too limited to waste on trying to go it alone, and your money is far too valuable to spend on hiring a web design firm to custom build a site for you. Your best option is number 3, using one of the ready-made instant websites from a company specializing in the mortgage industry.
Here is my list of some of the best firms out there, and ones you should consider before making a decision.
READY-MADE INSTANT MORTGAGE WEBSITE PROVIDERS:
* LoanBright.com
* FireComm.com
* FreeLOWebsites.com
* Avicy.com
* DigitalOrigination.com
* FindTheLowestRate.com
Any of these firms can provide you with a very professional looking site and help you create the company image you are looking for. Although pricing and services vary, be sure to evaluate each to determine the type of features you want your website to have. Things such as an online 1003 application, rate alerts, and newsfeeds can add a tremendous amount of interactivity to your site and get prospects to return again and again (because of the updated information).
One additional website you might want to consider is my FindTheLowestRate.com site. Although it isn’t a “company” oriented site, it’s purpose is solely to help you generate leads. You can learn more at:
http://findthelowestrate.com/leadsite.htm
I always tell my clients that you should have two websites at a minimum, maybe more. One site to create your company image, and one to act as a lead generation source. Of course, your company site will generate leads as well, but having a separate site whose sole purpose is lead generation can put you head and shoulders above all the other “me-too” mortgage firms out there. To attract hard-core rate shoppers and purchase-loan customers, this is an absolute must!
Review all your website options, set a firm goal and make a decision. Only by putting a stake in the ground and beginning where you stand, will you be able to reach your sales goals this year.
Thursday, March 13, 2008
An After-Closing Letter That Asks For More Mortgage Referrals
Let your customers know that the best compliment they can give you is a referral.
Here is a sample follow-up letter (I pulled out of my personal files) you can use with customers who have recently closed a loan with you. You’ll see that it congratulates them on completing the process, re-emphasizes the benefits of doing business with you, and asks for referrals.
By acknowledging the customer’s involvement in the loan, and following-up with them even after the loan is completed, you can generate additional business opportunities with very little effort. The difference between mediocre loan officers and top producers is often just going the one extra step to make the customer’s experience exceptional.
SAMPLE FOLLOW-UP LETTER, SENT AFTER LOAN CLOSING
Dear (CUSTOMER),
Congratulations, you’ve successfully completed the mortgage process!
Please find enclosed copies of any loan documents as well as a complimentary copy of your appraisal. You will want to keep these in a safe place for future reference.
With every loan, we strive to make you a “customer for life” through our outstanding service. Every loan experience should be as simple and pain-free as possible and we hope we have exceeded your expectations.
Remember, that as a mortgage broker…
We can help you purchase a new or second home—even an investment property!
We can present you with several loan scenarios that consolidate your debt thereby reducing your monthly cash flow.
We specialize in loans for people even if they have poor or have not so good credit.
We even have loan programs available for people who own their own business and are self-employed.
In closing, let us say that it was an absolute pleasure doing business with you and we look forward to helping you again in the future. Thank you so much for your business and welcome to our family of repeat customers.
Warm Regards,
(YOUR NAME)
Loan Officer (YOUR TITLE)
(YOUR COMPANY CONTACT INFO)
P.S.- We build our business on a referral basis. The highest compliment we could ever receive is a referral from our past friends and customers. Please share your experience with us to others.
Enclosure(s):
(LIST WHAT IS ENCLOSED WITH LETTER, ALWAYS INCLUDE BUSINESS CARDS, REFERRAL POSTCARDS, AND FOLLOW-UP SURVEY).
**** END SAMPLE LETTER ****
Feel free to use and modify the above letter as you see fit. The goal is to make it as personal as possible to fit your customer type and local marketplace. By doing what other people DON’T do, you can set yourself apart from the hundreds of other “me-too” loan officers out there.
Here is a sample follow-up letter (I pulled out of my personal files) you can use with customers who have recently closed a loan with you. You’ll see that it congratulates them on completing the process, re-emphasizes the benefits of doing business with you, and asks for referrals.
By acknowledging the customer’s involvement in the loan, and following-up with them even after the loan is completed, you can generate additional business opportunities with very little effort. The difference between mediocre loan officers and top producers is often just going the one extra step to make the customer’s experience exceptional.
SAMPLE FOLLOW-UP LETTER, SENT AFTER LOAN CLOSING
Dear (CUSTOMER),
Congratulations, you’ve successfully completed the mortgage process!
Please find enclosed copies of any loan documents as well as a complimentary copy of your appraisal. You will want to keep these in a safe place for future reference.
With every loan, we strive to make you a “customer for life” through our outstanding service. Every loan experience should be as simple and pain-free as possible and we hope we have exceeded your expectations.
Remember, that as a mortgage broker…
We can help you purchase a new or second home—even an investment property!
We can present you with several loan scenarios that consolidate your debt thereby reducing your monthly cash flow.
We specialize in loans for people even if they have poor or have not so good credit.
We even have loan programs available for people who own their own business and are self-employed.
In closing, let us say that it was an absolute pleasure doing business with you and we look forward to helping you again in the future. Thank you so much for your business and welcome to our family of repeat customers.
Warm Regards,
(YOUR NAME)
Loan Officer (YOUR TITLE)
(YOUR COMPANY CONTACT INFO)
P.S.- We build our business on a referral basis. The highest compliment we could ever receive is a referral from our past friends and customers. Please share your experience with us to others.
Enclosure(s):
(LIST WHAT IS ENCLOSED WITH LETTER, ALWAYS INCLUDE BUSINESS CARDS, REFERRAL POSTCARDS, AND FOLLOW-UP SURVEY).
**** END SAMPLE LETTER ****
Feel free to use and modify the above letter as you see fit. The goal is to make it as personal as possible to fit your customer type and local marketplace. By doing what other people DON’T do, you can set yourself apart from the hundreds of other “me-too” loan officers out there.
Monday, March 10, 2008
10 Ways To Survive And Prosper In A Down Mortgage Market
Again the Fed raised interest rates. And if you haven’t felt the noose tightening yet, you certaininly will now. With rates continuing their gentle climb and the refinance market now nothing but tumbleweeds, you MUST TAKE IMMEDIATE STEPS NOW if you want to survive in this industry.
Here are 10 immediate action steps you can take now. And, I emphasize the word “ACTION":
1. Give yourself an instant raise. Find a mortgage company that pays a small salary plus commission, or one that has a very high commission structure like many net branch companies do. Again, my recommendations are: Allied Mortgage, Carteret Mortgage, and 1st Metropolitan. They were my top three picks from my past article on mortgage net branching. They pay upwards of 70% or more and even if you only do a few loans a month, you can still make out pretty well. Ask yourself, how much you are earning now?
2. Stop loan fallout. Review all of your current loan procedures and notice at what stage the majority of loans are killed at. Is it during the sales pre-qual phase? Is it during processing? Is it at the closing table? Wherever your loans fallout is where you should focus and scrutinize your efforts. (If you don’t have an organized system in place, you can always use my Sink or Swim Loan Closing System at http://www.loanclosingsystem.com . No matter what, the important thing is to start somewhere and write all your mistakes down. And I’ve done a lot of the work for you!) Remember, if you can save just 1 extra deal per month from dying somewhere during the loan process, that’s an immediate $2,000 to $3,000 extra per month in your pocket. Cha-ching! Another instant pay raise.
3. Focus on purchase money loans. I would give-up on the refinance market unless you are going after sub-prime loans or debt consolidation cash-outs. The interest rates just aren’t there and it won’t make sense for your prospects. The days of 5% on a 30-year fixed are over. Don’t waste your time trying to rework a deal a thousand times. If the numbers don’t add-up, the deal is dead anyway.
4. Become an expert in niche loans. Do you know what an Option ARM loan is? What about the LIBOR index? You should. These 4-payment plan loans are the hottest things out there and are extremely popular! Niche loans you should consider focusing on are: interest only, option arm, regular arms, stated income, no-doc, reverse mortgage, A-minus, Immigrant Visa, and first-time homebuyer programs for specific fields like police officers and teachers. These loans appeal to a specific buyer and the interest rate is always secondary to the end-result. Become the “go-to guy” as an expert in one or more of these specialties and watch the referrals flow-in.
5. Try a new lead source. Where do you currently get your leads from? Have you been tracking their conversion ratio? How many leads resulted in actual closed loans? If you current source isn’t performing, you may want to consider another method of lead generation such as live-transfer calls, attending open houses, or choosing another Internet lead source. You can see how I generate all my own leads myself at http://www.FindTheLowestRate.com . You can too!
6. Don’t forget about HELOCS and second mortgages. These are small but powerful loans that can put immediate cash in your pocket. Surely, you have a base of customers that would like an extra source of credit if needed?! And the best part is, you already have all of their information on file and to close the loan is SIMPLE. Check with your company to make sure they can broker seconds and what the payouts are. I can tell you this, when times are slow, a few small second mortgages goes a long way.
7. Change your sales approach. How do you approach your customers? Are you saying the right thing? Do you fumble for words? Do what I did, write everything down and come up with your own “monkey scripts”. Once I started recording the objectives I would get, I simply wrote them down and came-up with a better response and a way to answer the customers questions. How fast you can overcome objections, will mean the difference between success and failure. You must know what to say if you want to sell!
8. Generate immediate referrals. Go through your ENTIRE customer base. Call every customer and thank them for their business. Give them a courtesy call to see how their mortgage is going and tell them that you would be happy to assist anyone else they may know of who is interested in a mortgage with a free rate quote. Even if it has been 6 months or a year, a personal phone call and a simple thank you works wonders.
9. Get into another part of the mortgage industry. Maybe selling loans isn’t for you. Maybe you need a change. I know many loan officers who get burnt out and move into the processing or underwriting side of the business and become extremely successful. Because they have the sales skills under their belt and have been on the front lines, they can do things that others can’t. Some of the best underwriters I know are former l.o.’s and brokers. Being an underwriter or processor is a more stable salary structure without all the ups and downs.
10. Decide if this is really something you want to do. If you don’t love this business, you shouldn’t be doing it. The mortgage industry isn’t just about money. It’s about helping people. You need to have a hunger and passion to be relentless and never give-up no matter the challenges. Top producers succeed because they love the variety and excitement they encounter. No day is ever the same and that’s why they love it! You should too!
I challenge you to take at least 1 step a day. Don’t wait. Do it now. Just take 1 step today and another tomorrow and you will be well positioned to turn things around. Stop procrastinating. Because if you do nothing, nothing will happen. So do something and even if nothing happens, that’s still something. Get it? ;-)
Here are 10 immediate action steps you can take now. And, I emphasize the word “ACTION":
1. Give yourself an instant raise. Find a mortgage company that pays a small salary plus commission, or one that has a very high commission structure like many net branch companies do. Again, my recommendations are: Allied Mortgage, Carteret Mortgage, and 1st Metropolitan. They were my top three picks from my past article on mortgage net branching. They pay upwards of 70% or more and even if you only do a few loans a month, you can still make out pretty well. Ask yourself, how much you are earning now?
2. Stop loan fallout. Review all of your current loan procedures and notice at what stage the majority of loans are killed at. Is it during the sales pre-qual phase? Is it during processing? Is it at the closing table? Wherever your loans fallout is where you should focus and scrutinize your efforts. (If you don’t have an organized system in place, you can always use my Sink or Swim Loan Closing System at http://www.loanclosingsystem.com . No matter what, the important thing is to start somewhere and write all your mistakes down. And I’ve done a lot of the work for you!) Remember, if you can save just 1 extra deal per month from dying somewhere during the loan process, that’s an immediate $2,000 to $3,000 extra per month in your pocket. Cha-ching! Another instant pay raise.
3. Focus on purchase money loans. I would give-up on the refinance market unless you are going after sub-prime loans or debt consolidation cash-outs. The interest rates just aren’t there and it won’t make sense for your prospects. The days of 5% on a 30-year fixed are over. Don’t waste your time trying to rework a deal a thousand times. If the numbers don’t add-up, the deal is dead anyway.
4. Become an expert in niche loans. Do you know what an Option ARM loan is? What about the LIBOR index? You should. These 4-payment plan loans are the hottest things out there and are extremely popular! Niche loans you should consider focusing on are: interest only, option arm, regular arms, stated income, no-doc, reverse mortgage, A-minus, Immigrant Visa, and first-time homebuyer programs for specific fields like police officers and teachers. These loans appeal to a specific buyer and the interest rate is always secondary to the end-result. Become the “go-to guy” as an expert in one or more of these specialties and watch the referrals flow-in.
5. Try a new lead source. Where do you currently get your leads from? Have you been tracking their conversion ratio? How many leads resulted in actual closed loans? If you current source isn’t performing, you may want to consider another method of lead generation such as live-transfer calls, attending open houses, or choosing another Internet lead source. You can see how I generate all my own leads myself at http://www.FindTheLowestRate.com . You can too!
6. Don’t forget about HELOCS and second mortgages. These are small but powerful loans that can put immediate cash in your pocket. Surely, you have a base of customers that would like an extra source of credit if needed?! And the best part is, you already have all of their information on file and to close the loan is SIMPLE. Check with your company to make sure they can broker seconds and what the payouts are. I can tell you this, when times are slow, a few small second mortgages goes a long way.
7. Change your sales approach. How do you approach your customers? Are you saying the right thing? Do you fumble for words? Do what I did, write everything down and come up with your own “monkey scripts”. Once I started recording the objectives I would get, I simply wrote them down and came-up with a better response and a way to answer the customers questions. How fast you can overcome objections, will mean the difference between success and failure. You must know what to say if you want to sell!
8. Generate immediate referrals. Go through your ENTIRE customer base. Call every customer and thank them for their business. Give them a courtesy call to see how their mortgage is going and tell them that you would be happy to assist anyone else they may know of who is interested in a mortgage with a free rate quote. Even if it has been 6 months or a year, a personal phone call and a simple thank you works wonders.
9. Get into another part of the mortgage industry. Maybe selling loans isn’t for you. Maybe you need a change. I know many loan officers who get burnt out and move into the processing or underwriting side of the business and become extremely successful. Because they have the sales skills under their belt and have been on the front lines, they can do things that others can’t. Some of the best underwriters I know are former l.o.’s and brokers. Being an underwriter or processor is a more stable salary structure without all the ups and downs.
10. Decide if this is really something you want to do. If you don’t love this business, you shouldn’t be doing it. The mortgage industry isn’t just about money. It’s about helping people. You need to have a hunger and passion to be relentless and never give-up no matter the challenges. Top producers succeed because they love the variety and excitement they encounter. No day is ever the same and that’s why they love it! You should too!
I challenge you to take at least 1 step a day. Don’t wait. Do it now. Just take 1 step today and another tomorrow and you will be well positioned to turn things around. Stop procrastinating. Because if you do nothing, nothing will happen. So do something and even if nothing happens, that’s still something. Get it? ;-)
Friday, March 7, 2008
How To Get Mortgage Clients To Stop Dragging Their Feet When Shopping For A Home Loan
At one time, borrower procrastination wasn’t a common problem, but has now become one, as more and more people got into the mortgage industry. Many of them were bad apples, incompetent or worse. Bad experiences and bad memories are what you are competing with.
For some customers, rate shopping is a game. No matter how hard you try, they will never go with you. They just want to see how low a rate you could get them. It may be that they aren’t procrastinating, but rather are just putting you off, because they decided to go with someone else. Anything they say such as “hassle”, “it’s not worth it”, etc. may be just a cover.
On the other hand, if the deal you give the customer isn’t meaty enough for them, (meaning that they aren’t going to save a significant amount), some customers will simply throw up their hands in frustration. These are the ones that have gotten burnt before in the process, leaving a sour taste in their mouth. For them, it’s just not worth it.
Provided your mortgage deal makes sense and is in the best interest of the customer, here are a few ways I’ve learned to get clients to stop dragging their feet.
1. Explain the entire process in full. Show them how simple it is and that you will take care of all the necessary paperwork. They merely have to follow your lead. Although, getting a mortgage is a long and tedious process, you have to prove your case and demonstrate that your firm is different from the rest. Despite what the customer has experienced in the past, you aren’t like other loan officers.
2. Create a compelling reason to act. How much will they save per month? How much in interest will they save over the life of the loan? Demonstrate the financial incentive to them in black and white.
3. Translate the financial numbers into a real-life perspective that clients can understand. People need to be able to rationalize things. How many nights-out is this? How much extra “fun” money will they have? Whatever the client is into, put the financial motive into a physical, tangible one. When people think about things that way, money becomes all the more real.
4. Let them know that there will be “pain” if they don’t act. The opportunity won’t last forever, and their reluctance to act will cost them in the long run. Are the interest rates rising? Is there something about their situation that will affect their ability to refinance in the future? Are they looking for cash out, and if so, can the pain of their debts/bills be used to motivate them?
5. If the customer doesn’t listen to reason, and still won’t act, they may have paralysis by analysis. I call these the “engineer types”, as they want to nit pick every part of the process and will shop forever, always looking for a better deal. My advice—give up on these loans. They will cause you more trouble than they’re worth.
For some customers, rate shopping is a game. No matter how hard you try, they will never go with you. They just want to see how low a rate you could get them. It may be that they aren’t procrastinating, but rather are just putting you off, because they decided to go with someone else. Anything they say such as “hassle”, “it’s not worth it”, etc. may be just a cover.
On the other hand, if the deal you give the customer isn’t meaty enough for them, (meaning that they aren’t going to save a significant amount), some customers will simply throw up their hands in frustration. These are the ones that have gotten burnt before in the process, leaving a sour taste in their mouth. For them, it’s just not worth it.
Provided your mortgage deal makes sense and is in the best interest of the customer, here are a few ways I’ve learned to get clients to stop dragging their feet.
1. Explain the entire process in full. Show them how simple it is and that you will take care of all the necessary paperwork. They merely have to follow your lead. Although, getting a mortgage is a long and tedious process, you have to prove your case and demonstrate that your firm is different from the rest. Despite what the customer has experienced in the past, you aren’t like other loan officers.
2. Create a compelling reason to act. How much will they save per month? How much in interest will they save over the life of the loan? Demonstrate the financial incentive to them in black and white.
3. Translate the financial numbers into a real-life perspective that clients can understand. People need to be able to rationalize things. How many nights-out is this? How much extra “fun” money will they have? Whatever the client is into, put the financial motive into a physical, tangible one. When people think about things that way, money becomes all the more real.
4. Let them know that there will be “pain” if they don’t act. The opportunity won’t last forever, and their reluctance to act will cost them in the long run. Are the interest rates rising? Is there something about their situation that will affect their ability to refinance in the future? Are they looking for cash out, and if so, can the pain of their debts/bills be used to motivate them?
5. If the customer doesn’t listen to reason, and still won’t act, they may have paralysis by analysis. I call these the “engineer types”, as they want to nit pick every part of the process and will shop forever, always looking for a better deal. My advice—give up on these loans. They will cause you more trouble than they’re worth.
Tuesday, March 4, 2008
How To Find “For Sale By Owner Properties” FSBO’s In Your Area To Market And Sell To
For sale by owner properties, or FSBO’s as they are commonly refereed, are some of the best places to look for new clients. If done correctly, they can provide a steady stream of interested and motivated new home purchasers. And at very little cost.
As a loan officer, your goal is to become the mortgage source that the FSBO seller will refer interested home buyers to, to get pre-qualified. And don’t forget that the FSBO seller may be looking for a new property as well—and with that a new loan. If you work the arrangement properly, you can get loans coming from both ways.
Here are some of the best places to locate FSBO’s in your area:
* The real estate classified section of your local newspaper.
* The Want Advertiser Magazine, and other small local buy/sell classified ad magazines. To give you a sense, a similar magazine is the Auto Trader, but there are ones out there that deal specifically with items and property.
* Drive around the neighborhoods you know are hot markets.
* Ask real estate referral partners such as realtors (they look for FSBO’s too, so may have seen one), appraisers (most FSBO’s will an appraisal report to justify a price), real estate attorneys (FSBO’s need contract work done), and others.
* Real estate section on ebay. A great resource!
* Warnock’s By Owner, an alerting service for real estate and mortgage professionals that tracks FSBO’s all over the country. You can visit their site at http://www.wbyowner.com
* Other FSBO sites to look at: http://www.fsbo.com, http://www.virtualfsbo.com, http://www.isoldmyhouse.com, http://www.salebyownerrealty.com, http://www.fsbonetwork.com, http://www.fsbo.net.
The most important thing to remember when dealing with FSBO’s is to identify to the prospect that you are NOT a real estate agent. You are there to help them weed out the unqualified prospects and save them time, money, and aggravation. These are the hot- buttons that will get your foot in the door, and a sale in your pocket.
In our next installment, we’ll look at how to best approach a FSBO prospect.
As a loan officer, your goal is to become the mortgage source that the FSBO seller will refer interested home buyers to, to get pre-qualified. And don’t forget that the FSBO seller may be looking for a new property as well—and with that a new loan. If you work the arrangement properly, you can get loans coming from both ways.
Here are some of the best places to locate FSBO’s in your area:
* The real estate classified section of your local newspaper.
* The Want Advertiser Magazine, and other small local buy/sell classified ad magazines. To give you a sense, a similar magazine is the Auto Trader, but there are ones out there that deal specifically with items and property.
* Drive around the neighborhoods you know are hot markets.
* Ask real estate referral partners such as realtors (they look for FSBO’s too, so may have seen one), appraisers (most FSBO’s will an appraisal report to justify a price), real estate attorneys (FSBO’s need contract work done), and others.
* Real estate section on ebay. A great resource!
* Warnock’s By Owner, an alerting service for real estate and mortgage professionals that tracks FSBO’s all over the country. You can visit their site at http://www.wbyowner.com
* Other FSBO sites to look at: http://www.fsbo.com, http://www.virtualfsbo.com, http://www.isoldmyhouse.com, http://www.salebyownerrealty.com, http://www.fsbonetwork.com, http://www.fsbo.net.
The most important thing to remember when dealing with FSBO’s is to identify to the prospect that you are NOT a real estate agent. You are there to help them weed out the unqualified prospects and save them time, money, and aggravation. These are the hot- buttons that will get your foot in the door, and a sale in your pocket.
In our next installment, we’ll look at how to best approach a FSBO prospect.
Saturday, March 1, 2008
How To Deal With Pushy Wholesale Account Representatives In The Mortgage Industry When You Are A Loan Officer
As a mortgage broker, one of your main advantages is that you have access to many different lenders and hundreds of loan programs, which you can offer your customers. Having too many lenders to deal with--however--can become one of your biggest problems.
As the person between the borrower and the bank, you’re responsible for dealing with the myriad of third parties involved in the transaction. You’re dealing with appraisers, title companies, attorneys, underwriting, wholesalers, etc. You’ve already got a lot on your plate, so adding more “things” or “people” for you to deal with in your office, isn’t going to help you get any more loans closed. You want to simply your business and your life.
How many times have you been bombarded with rate sheets, special pricing offers, free donuts, luncheons, etc. from wholesalers? How much time did these people cost you? Did they help you close any of your “difficult” loans? Did anything come of it? Are they bringing anything of value to the relationship? These are questions to consider before letting another lender’s rep into your office. They can suck-up all your time, and leave you with nothing to show for it. Don’t go down a road to nowhere and let this happen to you.
Here are some of my top tips for dealing with pushy wholesale account representatives:
* Realize that there are some stellar wholesalers out there. They aren’t all bad. Some will go the extra mile for you and fight your case to the underwriter on difficult loans. Unfortunately, you won’t find this out until you are deep into the loan process, and after your relationship has progressed to a respectable working level. Until it gets to that point, it is impossible to differentiate one wholesaler from another.
* Never deal with an account representative that is new to the lender, or has only been in the mortgage business a short time. You’ll end-up having to “train” them, and they won’t have much value to bring to the table. They also tend to be the ones who call all the time begging for a loan, because they don’t have many clients to service. To get the best rates, and highest level of service, demand someone with at least 2 years of experience, preferably more, with a particular lender.
* Don’t allow yourself to be stuffed onto the wholesalers marketing lists. Your fax machine and email with be overflowing with gimmicky sales pitches and mortgage hyperbole.
* Never allow a wholesaler into the office, without first speaking to them IN-DEPTH over the phone about their loan programs. They will try to schedule an appointment to come see you, but why spend an hour or two in a meeting, if their programs and rates aren’t competitive?
* Ask for a sample rate sheet upfront, so you can see what their rates are. Better yet, get their program and underwriting guidelines so you can judge how “strict” the underwriters will be. Even if their rates are low, can you still get the deal closed?
* If you are a new broker, and don’t have many lenders, try not to go overboard and sign-up with everyone. Believe me, you’ll be overwhelmed with phone calls, and only have so many loans to go around. Not every wholesaler you sign-up with get a loan from you. They should know this upfront.
* Wholesalers can be a valuable resource into the rest of the industry. They all know each other and are great for getting the inside scoop on the other local mortgage companies as they make their rounds. They also have a lot of connections with lenders and should know how their programs stack up to others.
* When a wholesaler calls and starts in on his sales pitch. Say, “Why should I do business with you?” “What will you offer me, other than low rates?”. A low interest rate is not enough, these days you also need a high degree of service to get the deal closed. I’ve seen many deals fall through not because the rate wasn’t low enough, but because the account representative sat on his hands. Is this guy going to go to bat for you? Ask him.
* Focus on working with a handful of lenders, and send them the majority of your business. You should have 5 to 10 A-Credit lenders, and know their programs inside and out. B-Credit is more complicated, so you’ll need between 10 to 15 for shopping purposes. By narrowing your field of lenders, you’ll get to know the account reps better and can deepen relationship. They will become more like a partner and an extension of your mortgage office. But, remember to choose wisely because your loan rests in their hands.
These are some of the policies I follow in my office and teach my students. The mortgage business is full of people who are all acting in their own business interests. Remember, the wholesaler’s job is to bring in loans from mortgage brokers. They are selling to you, as much as you are selling the loan to the end-borrower. Use them as a valuable and trusted resource, but don’t fall into the trap of being distracted by an endless array of programs and rates.
Follow these tips, and your business will be much more focused and on track.
As the person between the borrower and the bank, you’re responsible for dealing with the myriad of third parties involved in the transaction. You’re dealing with appraisers, title companies, attorneys, underwriting, wholesalers, etc. You’ve already got a lot on your plate, so adding more “things” or “people” for you to deal with in your office, isn’t going to help you get any more loans closed. You want to simply your business and your life.
How many times have you been bombarded with rate sheets, special pricing offers, free donuts, luncheons, etc. from wholesalers? How much time did these people cost you? Did they help you close any of your “difficult” loans? Did anything come of it? Are they bringing anything of value to the relationship? These are questions to consider before letting another lender’s rep into your office. They can suck-up all your time, and leave you with nothing to show for it. Don’t go down a road to nowhere and let this happen to you.
Here are some of my top tips for dealing with pushy wholesale account representatives:
* Realize that there are some stellar wholesalers out there. They aren’t all bad. Some will go the extra mile for you and fight your case to the underwriter on difficult loans. Unfortunately, you won’t find this out until you are deep into the loan process, and after your relationship has progressed to a respectable working level. Until it gets to that point, it is impossible to differentiate one wholesaler from another.
* Never deal with an account representative that is new to the lender, or has only been in the mortgage business a short time. You’ll end-up having to “train” them, and they won’t have much value to bring to the table. They also tend to be the ones who call all the time begging for a loan, because they don’t have many clients to service. To get the best rates, and highest level of service, demand someone with at least 2 years of experience, preferably more, with a particular lender.
* Don’t allow yourself to be stuffed onto the wholesalers marketing lists. Your fax machine and email with be overflowing with gimmicky sales pitches and mortgage hyperbole.
* Never allow a wholesaler into the office, without first speaking to them IN-DEPTH over the phone about their loan programs. They will try to schedule an appointment to come see you, but why spend an hour or two in a meeting, if their programs and rates aren’t competitive?
* Ask for a sample rate sheet upfront, so you can see what their rates are. Better yet, get their program and underwriting guidelines so you can judge how “strict” the underwriters will be. Even if their rates are low, can you still get the deal closed?
* If you are a new broker, and don’t have many lenders, try not to go overboard and sign-up with everyone. Believe me, you’ll be overwhelmed with phone calls, and only have so many loans to go around. Not every wholesaler you sign-up with get a loan from you. They should know this upfront.
* Wholesalers can be a valuable resource into the rest of the industry. They all know each other and are great for getting the inside scoop on the other local mortgage companies as they make their rounds. They also have a lot of connections with lenders and should know how their programs stack up to others.
* When a wholesaler calls and starts in on his sales pitch. Say, “Why should I do business with you?” “What will you offer me, other than low rates?”. A low interest rate is not enough, these days you also need a high degree of service to get the deal closed. I’ve seen many deals fall through not because the rate wasn’t low enough, but because the account representative sat on his hands. Is this guy going to go to bat for you? Ask him.
* Focus on working with a handful of lenders, and send them the majority of your business. You should have 5 to 10 A-Credit lenders, and know their programs inside and out. B-Credit is more complicated, so you’ll need between 10 to 15 for shopping purposes. By narrowing your field of lenders, you’ll get to know the account reps better and can deepen relationship. They will become more like a partner and an extension of your mortgage office. But, remember to choose wisely because your loan rests in their hands.
These are some of the policies I follow in my office and teach my students. The mortgage business is full of people who are all acting in their own business interests. Remember, the wholesaler’s job is to bring in loans from mortgage brokers. They are selling to you, as much as you are selling the loan to the end-borrower. Use them as a valuable and trusted resource, but don’t fall into the trap of being distracted by an endless array of programs and rates.
Follow these tips, and your business will be much more focused and on track.
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