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Establishing and Enhancing Your Relationships

Daniel Milstein
Jun 11, 2012

Developing long-term, effective relationships with customers, prospects, strategic partners and others should be a primary goal for all loan originators (LOs). Many originators place a high priority on this critical part of building their business, while others tend to forget. Of course, it is an ongoing process and all mortgage professionals must continue adapting to changes in their sphere of influence and marketplace. Key guidelines I consider the key components of establishing relationships to be: ►Providing something of value Originators should not have an overly commercial focus when dealing with their key audiences; and refrain from always discussing the lowest rates, the refinance opportunities and so on. Obviously, this is an element of creating relationships, but so is offering educational information and other support that the customer/other considers important, to assist with their personal planning and/or to do their jobs better. ►Showing that you care Customers appreciate their originators and their team members demonstrate an interest in their welfare. This means asking about the customer’s future plans, family members, hobbies and related areas. ►Timely response No matter how busy we are, it is critical to respond to customers’ and strategic partners’ calls and e-mails as soon as possible. Even if you cannot take the time for a lengthy phone discussion, you (or your assistant) can at least send an e-mail or make a quick call to advise someone that you will check back as soon as you’re able. ►Ongoing contact It is essential to maintain an appropriate level of contact so that we remain visible. You have to remind them that you are still available to help with their future home financing needs. Customers first Of course, the most crucial relationship is with your past customers. All successful LOs have a “customers for life” mindset. Establishing solid relationships with customers ensures that you will get their future business, as well as their referrals to others. This sounds so simple, yet the key is to actually follow-through. It begins with first impressions and continues through ongoing contact. We strive to generate a positive initial impression by making customers feel welcome in our office, spending the right amount of time to explain their options, listening carefully to their questions and concerns and emphasizing that we will help them every step of the way. Originators rely on a variety of ways to maintain post-closing visibility with their past customers. Whether it be e-mail newsletters, postcards, holiday greetings or birthday cards, the key is to be consistent. I send customers letters/other mailers at least six times a year and make frequent calls as well. I include a “call to action” in every conversation, by asking how I can help them with a new loan or if I can be of service to a friend or family member. I am a strong advocate of providing useful, educational information, such as “how to” guides. Customers and prospects should believe that you truly care about helping them better understand home financing. This has become especially important following the mortgage industry’s “meltdown” and subsequent tightening of credit and related guidelines. Customers need more direction as to what is possible. Real estate agents We know that during heavy refinance periods, relationships with real estate agents are often ignored, which, of course, is a huge mistake. If you aren’t maintaining contacts with your market’s best agents, someone else is. During refinance boom of 2004, many LOs were too busy to spend time with their favorite agents. When refinance activity began to slow, their overall production suffered because they were not getting much business from real estate agents. However, those who had a purchase/long-term focus and had maintained contact with agents saw their business increase in 2005. Again, there are so many different ways to strengthen your bond with agents, but I believe one of the most effective methods is to ensure their clients get the best possible service. Accurate pre-approvals, timely closings and regular communications to avoid uncertainty/delays can make a major difference in demonstrating that you have their best interests in mind. I know that one of the reasons agents appreciate working with us is that we strive to make every transaction seamless and trouble-free. Another critical element of relationships with real estate agents is the sharing of referrals. Many originators develop a one-sided relationship with agents, with a tendency to ask for referrals rather than to offer them as well. One of my early strategies as an LO was to provide several referrals to agents without asking for any in return. They saw that I was truly interested in building a solid, long-term relationship. It became a win-win situation for all as they soon began providing me with their referrals. I also believe it is beneficial to develop relationships with newer agents, as well as the more seasoned top-producing agents. If you cultivate contacts with agents who appear to be proactive and otherwise on the path to success, they will usually be among your most loyal supporters as they gain more experience and sales. Other industry professionals CPAs, attorneys and business managers are all great sources of business and offer an opportunity to expand your professional sphere of influence. At the heart of these mutually beneficial associations is the offer to share information that will assist these strategic partners and benefit their clients. For example, when I first make contact with a CPA or attorney, I’ll explain that I can assist their clients by providing my expertise with a purchase or refinance, as well as support the strategic partner in other ways. I don’t ask for referrals, but rather suggest that if we have similar business and customer service approaches, we should do whatever possible to help each other. Teachers, fire personnel and more Most LOs have established one or more niches with key groups, such as teachers and fire/safety personnel. Two of my early niche groups were immigrants and professional athletes. The first was based on my own background as a Soviet Union (Ukraine) immigrant who came to America as a youth. As a new LO, I realized that I could be of special service to other immigrants, which included assisting them with finding an apartment and obtaining a driver’s license. Immigrant groups are generally extremely loyal. When you consider developing such a niche, it is important to understand the culture—including the group’s homebuying attitudes—but it isn’t absolutely necessary that you speak their language. By the time they are ready to purchase a home, most people have at least a basic grasp of the English language. I later assisted a professional hockey player and gradually developed a strong base of professional hockey players and other athletes. In order to create effective relationships with such niches, you have to find out what is most important to them and then be certain to provide that. Social media Mortgage lending has changed dramatically during the last five to 10 years. One of the major developments has been the role that social media plays in establishing customer/other relationships. Previously, we were limited to snail mail and face-to-face meetings to develop our relationships, which we later enhanced with e-mail and Internet communication. An ever-increasing number of LOs are adapting Facebook and LinkedIn strategies to reach out to their sphere of influence and stay connected with new groups. It is a timely way to communicate with your customer base—especially with the “younger” generations of buyers and others accustomed to communicating via social media outlets. The challenge is to stay abreast of the rapid marketing-tech advancements, but that is just one more of the LO’s new responsibilities. The common elements in all of our business-related associations are service, communication and support. Those are the basics that make customers, real estate agents and others want to work with us. As all mortgage lending professionals know, it takes time to cement meaningful customer/strategic partner relationships so we should do whatever possible to maintain and improve them. Daniel Milstein is founder and chief executive officer of Ann Arbor, Mich.-based Gold Star Mortgage Financial and the author of the award-winning The ABC of Sales, Lessons From a Superstar. He may be reached by phone at (734) 971-9900 or e-mail [email protected]
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