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National Mortgage Professional
Apr 29, 2005

How to retain customers and build a referral baseGeorge S. Phelpsreferral sources, customer retention, communication schedule Everyone knows the old adage that it costs more to get a new customer than keep an existing one. This could not be truer in our business. You have basically one shot to make your borrower or real estate agent a customer for life. So, what are some things you can do to retain your customers and build a strong referral base? Develop a customer nurture strategy Whether you are talking to past borrowers or other referral sources, such as a real estate agent or accountant, they need to hear from you on a regular basis. They need to know that they are important to you and your business. So develop a schedule to communicate regularly with themwhether it is by phone, e-mail, regular mail or in person. Marketers call this a "nurture strategy," as you are nurturing the relationship. You are reminding your borrowers and referral sources of their good decision to do business with you, and you want them to think of you for future mortgages. Carol Lynn Upshaw of Upshaw Lending Professionals LLC in Atlanta hosts a Christmas tea every year and invites 150 women. She said, "These people have become my friends. We've developed relationships where if I need to call my appraiser at 7:00 a.m. for an appointment at 10:00 a.m., I can do that." She also sends Christmas cards to all of her past borrowers. Set up a regular schedule of communication In setting up your communications program with your past borrowers and other referral sources, consider communicating with them quarterly. Monthly contact can be considered overkill and may begin to feel like spam to your audience. Most importantly, always respect a person who no longer wishes to hear from you and remove their name from your list. By maintaining quarterly contact, you can stay at the top of their list for mortgage loans. To stay in touch with her real estate agents on a regular basis, Upshaw said she hosts a big quarterly dinner. This enables her to strengthen and build these relationships. What to send past borrowers Remember, borrowers want to hear and read things about themselves and issues that are important to them. Don't send them information about you; send them information about them. Send articles or newsletters with tips on homeownership, how to add value to their home, home repair schedules, etc. Keep them apprised of new mortgage products and the benefits to borrowers. Give them valuable information and they, in turn, will value your partnership. The strength of your referral sources The key to building a solid business is building solid relationships with all possible referral sources--from real estate agents and appraisers, to financial planners and accountants. Drawing from a variety of referral sources is key. Mitsu O'Riley of First Coast Mortgage in St. Augustine, Fla. said her entire business is referrals. She has about five real estate agents who are responsible for sending her the bulk of her business. "The one thing I try to do is treat them well. I answer questions for them and, in turn, ask them to refer me to other real estate agents. I also work to pull together hard deals and not let them down." Reward referrals with a phone call or note Any time a borrower or other referral source sends you business, take the time to pick up the phone or write them a note thanking them. Doing this will reinforce that you are a good businessperson. Business is all about relationships, and you want to maintain a strong relationship with your referral sources. Upshaw rewards her best referral sources with dinner certificates. She said, "It's not just about what I am doing; it's the good people that I have surrounded myself with, and I certainly recognize that." Your best retention vehicle--service! No matter what the process or person, the bottom line is service. Upshaw answers her phone 24 hours a day and O'Riley makes it a point to know the inside reps and underwriters so loans close smoothly. During the mortgage process and even afterwards, by maintaining a high level of customer service with your past borrowers and referral sources, you will ensure they truly stay customers for life. George S. Phelps is executive managing director of Atlanta-based Primary Capital Mortgage. He may be reached at (770) 226-8181 or e-mail
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