In the movie, "Seabiscuit," the trainer of the now-famous horse took it out to a field and just let him run, realizing that he had forgotten what he was born to do. In so doing, Seabiscuit found his legs and became one of the great horses of the 20th century. In 2004, I think brokers need to take a clue from this movie. We have been feasting on refinances for so long that we have forgotten what we were have been trained to do--help people into homes. Return to the things you once did to explode your volume in 2004 ... I offer a few refreshers for you.
Master the art of the follow-up!
Let's face it. 2004 will be a year that you will come up against your competition in a way that you have not seen in years! Most experts are projecting a drop of more than 60 percent in loan origination volume, with a decrease of just 30 to 40 percent in loan officers and companies. Something's got to give!
Personally, I am of the opinion that I cannot control what the industry does or what my competitors do; I can only control what I do. If there is one glaring opportunity, an area where even the largest lenders fall short and an area where real estate agents complain about the most, it is in following up. Simply put, our industry is pathetic at following up with leads, and therein lies an awesome opportunity. Leads are precious, and each one needs to be followed up with at least five contacts! If one of your borrowers is pre-qualified, send out a follow-up e-mail or phone call within a few days--followed by a mailing, and then another phone call, until you have touched base with them at least five times. Why five? Because the Law of Five in Sales says that 80 percent of all business happens after the 5th contact. By that rationale, even if you convert just 20 percent of your leads, you can quadruple your income!
The key is to alternate your phone call with something of value, whether it be a report on homes in the area or a letter from you. Your competition rarely even calls back once, let alone up to five times. This simple follow-up procedure can virtually eliminate your competition!
Get a loan from every loan!
Sound easy? Let me tell you, it is rarely done. I have heard people say that it is not as easy to get referrals from purchases as it is from refinances--that's bunk! Purchasing a home is a huge deal, and your borrowers will tell everyone they know about their experience. Try this simple technique. Each Friday, while your loans are in process, call the customer up and update them on its status. Each week, before you hang up, casually ask them if they know anyone who is looking to buy a home. They may not know someone after the first call, but by the fifth, they will be working for you without even realizing it! This one tip can double your business by the end of the year!
Consistently market to multiple groups!
Never put all of your eggs in one basket. You need to have your marketing working with at least three groups simultaneously. If you only target real estate agents, you are missing some great synergies that go on. When I was a full-time originator, it was not unusual for someone to come to me who was referred by their real estate agent, their best friend, their mechanic, etc. It was not a question of if they were going to use me, it was when!
The key to marketing in 2004 is consistency. It does not matter how good your strategy is, it must be done consistently. Don't stop after two weeks, that's what your competition does. It won't be until the fifth week when you have their attention. The key is to market consistently to several different groups at the same time--one simple marketing system to each group happening concurrently.
Master the art of time blocking!
There are only a few tasks each day that really build your business. These are the activities that should be blocked off and treated like an application appointment. When you write a loan application and are across from a client, you do not take pages or inbound calls. Yet, when you're making sales call, you answer pages and e-mails, and open the morning mail. You need to block these key activities--leave a message on your pager saying you are in with a loan applicant until 11:00 a.m. Tell the receptionist to hold your calls. Pretend each block is an important client and treat it that way, because in truth, these may be the important clients in your future.
Capitalize on the alternative products you already
In a purchase market, you will have many unconventional loan requests. You need to have low money down and alternative credit sources available in order to capture maximum volume. The good news is, you probably have the lenders already signed up ... you just don't know it! Look up your neighborhood lenders--Chase will do loans at 100-percent with alternative credit; ABN AMRO will do loans with Fannie Mae rates and no money from the customer and just a five-percent gift; GreenPoint will do loans at 97-percent with a 575 credit score. Your ability to offer these products will help separate you from your competition that only knows Fannie Mae and FHA. Block off one hour each week and call some of these lenders to learn what they offer. You will be amazed at what you already have available! The year 2004 is not the year to leave even one deal on the table!
All of this boils down to basic common sense, things we used to do without thinking about it. This year, it is time to get back to mortgage brokering and regain the power!
Brian L. Peart of Nexus Financial is an industry trainer and publisher of Top Producer magazine. He offers a free netletter which you can opt-in for at www.nexusfinancial.com. Brian may be reached by phone at (800) 905-0452 or e-mail [email protected].