When the borrower asks the rate question, you must answer the trust questionDave Bartelsinterest rate, excellent service, knowledge, National Association of Realtors
Offering the best interest rate will not determine whether or
not a borrower will choose to do business with you. Our industry
has been pre-conditioned to think this, but loan costs really only
matter if your focus is on rates and fees. In truth, the originator
who best serves the borrower's needs gets the business. As you
provide excellent service, the rate issue will drop on the
borrower's priority list—whether they realize it or not.
To a huge percentage of borrowers, the loan they seek is the
most significant transaction they will ever undertake. They are
often consumed with worry about making a sound decision. As a
result, potential clients approach the discussion with a great deal
of apprehension. Consumers focused on anxiety seek additional
information (they shop), while confident buyers make the purchase.
People in need of a loan approach you because they hope you have
answers. If you withhold information from them that they know you
possess, you increase their anxiety.
The originator's objective is simple: To relieve the prospect's
concern (mystery) and help move them toward knowledge (confidence).
When you dodge the rate question, your method is counterproductive
to the objective. Once your customer is in a state of knowing, they
will gain the confidence needed to select you as their guide and
Consider your own life experience: When you need to make a
decision, but lack adequate knowledge, you have a need to acquire
it. If you cannot obtain the complete, appropriate information you
desire from someone you feel should be qualified to supply it, you
feel mistrust. You seek the information elsewhere. The denial of
your needs causes you to resume your search.
Remember that while you are interviewing the borrower, the
borrower is interviewing you, as well. When a borrower doesn't feel
they are getting enough information from you, they will find
someone else to ask. Their need to validate or expand their
knowledge base will cause them to shop, even when they actually
prefer to buy. Answer this question: Does your presentation create
questions or answer them? Are you relieving anxiety or are you
It's time to make an important mental shift: When a potential
client inquires about rates, don't automatically assume they are
shopping you. Instead, answer with the expectation that they are
going to buy. The rate question now becomes a clear indication that
every borrower is interested.
The very next time a customer asks for an interest rate, this is
what you'll hear: "I want a loan, and I need more information."
Translation: You have an anxious borrower in need of help to feel
better about the huge decision they must make. Your objective kicks
in, and you offer information that will relieve their concern and
move them toward knowledge.
Our core belief must become: "Selling is serving." When this
philosophy is internalized, it will change the way you present
advice. In fact, it will absolutely transform the way you perceive
every client, every loan and every opportunity. If this is the only
element of the sales process you alter, you will immediately
improve the percentage of leads you convert into loan applications
and closed loans.
Did you know that a National
Association of Realtors study reports that 58 percent of
borrowers spoke to just one originator before obtaining a mortgage?
This means that nearly six out of 10 borrowers you speak to have
already chosen you. Knowing this, begin to focus on what you
want—qualified borrowers who are begging to work with
you—and remove your attention from what you don't
want—unqualified, resistant shoppers.
It's safe to say that every originator in the business will
provide an outstanding level of service to a qualified borrower
seeking a huge loan who has already selected that originator to
provide the loan. Immediately, begin to assume:
(A) This is the biggest transaction you have ever done;
(B) The borrower has already chosen you; and
(C) The borrower is qualified.
We've established that borrowers select an originator based on
trust, and providing information fills a need and creates trust.
Simply take the time to discover your borrowers' wants and needs,
and focus on supplying them. If you approach every borrower with an
attitude of service, they'll notice, and it will have a bigger
impact on your fundings than anything else—rates included.
This single-minded approach will banish the perceived need for
high-pressure closing techniques. Choosing you will be the obvious
conclusion, and as a result, you'll close more loans.
David Bartels is founder of the Selling Smarter and
High Performance Strategies for Loan Officers and Their Managers
seminar series. He may be reached by e-mail at [email protected]