I remember lending way back in 1981, which was when I first started in this industry. A 21 percent prime? Having no reference point to begin with, it didn't mean a thing to me. Laser printers, fax machines, e-mail, computers and certainly the Internet weren't real things. Yet here we are in 2005 and all of the aforementioned are now necessities in the loan business. With all these great tools, however, there is no "super fix" for getting and retaining customer loyalty. Have you ever lost a customer? Of course you have, and you will again.
While some loan officers are waiting for the phone to ring, others want to be a bit more proactive in shaping their future. Let's assume that you have automated underwriting, good pricing, a great processor and no major drug habit. A racecar without the proper care won't go very fast for very long. And yes, it's a race out there there are many loan officers with good pricing and good service, who are all competing for the same customers. All things being equal, who gets the deal? Loyal customers are wonderful to have. Usually, they are less sensitive to price and you may actually earn a fair commission. An "infinite" source of advertising dollars could do the trick as well. The national lenders have that. For the regular "Joe" or "Josephina," you need to be ahead of the curve.
Modern marketing tools will give you an edge, but nothing will win you 100 percent of the deals 100 percent of the time. There's no such animal. Of course, there are "must-have" marketing tools for professional loan officers. The first is a Web site. I've had a Myer's Internet site since early 1996, but just because you have a Web page, doesn't mean that the phone is going to ring off the hook. There are many mortgage sites out there for customers to choose from, all of which are fantastic tools for working the system. Your Web address goes on your business card just like your e-mail and phone number, and most sites include online applications and calculators. Who wants to drive to take an application, if they can get the customer to visit their Web site? In eight years, I've probably taken 40 in-person applications while tripling my business. Online applications are a real timesaver. Now I can concentrate on better service and marketing during the process. You can also display your rates online so there's no need to distribute flyers all the time. Customers can automatically track rate changes, and you can advertise why you are better than anyone else in the universe!
Do you maintain a customer database? Of course you do, but do you work it or watch it? How often do you send something to your customers? If you're not contacting them, then someone else is. Keeping your name in front of customers is important to maintaining their loyalty.
Do you work your database regularly, including asking your customers for referrals? Aren't they a big part of your sales force? How about using automated underwriting for quick answers, and creating spreadsheets for your customers? I guarantee that most loan officers don't know as much about it as you might think. Understanding "mortgage math" is essential. Take apart the numbers and give concrete advice. Demonstrate after-tax breakeven points, amortization and principal reduction. Show them the variable vs. fixed-rate scenario. There are many different software programs that will give you the answers quickly.
Should you tailor your pitch for different personality types? You bet. If you have the same pitch for everyone, you're limiting your success. Do you think that engineers want to hear the same pitch as your "touchy, feely" customers?
There are various Web sites, including Granza.com, that give loan officers a competitive advantage. Granza lets you use smaller, local businesses from the loan officer's exclusive "team" area to supply "rewards." Granza rewards are one-time, private, best-deal discounts for customers that close a deal with you or a real estate agent on your team. Thousands of dollars of best-deal discounts will entice more customers, both new and existing, to choose you over the next guy. The bad news is that just like other tools of the trade, you have to be proactive. Too many loan officers jump right in and expect that someone will do everything for them. A miracle cure doesn't exist! This is not a "one-size-fits-all" business. Is any business? Some approaches work for some and not for others.
Now what? Put a toe in the water. Get yourself some tools and don't be lazy. Realize that things may not work the first time and learn to be okay with that. Go through the learning curve. Take chances and break your own personal mold. If you're already hugely successful, then this is old news and thanks for reading. If not, it's time to get to work!
Paul Burger is president and chief executive officer of Glendale, Calif.-based Granza.com. He can be reached at (818) 243-7063 or e-mail [email protected].