The first challenge Healy faced as a newly licensed originator more than a decade ago was developing a book of business. Having no clue on how to start generating leads, Healy first turned to cold calling real estate brokerages in states he was licensed. But he was disappointed to find how difficult it was, even as an extroverted people-person, chatting to people on the phone. 

“I used to call real estate offices in Florida, Louisiana, and Texas,” Healy said, adding that he wouldn’t have to worry about running into those agents if he ended up embarrassing himself — which happened frequently among those first few calls.

“If I screwed up or said something wrong, like, ‘Hey, my name's Matt. I work for… oh God’ — and then hang up the phone. I would never see those real estate agents ever again because in New York, [or] specifically on Long Island, this industry is very small,” Healy said. “So you will see these same people at networking events. And I don't wanna be noted as that guy, [like] ‘Oh, look, there's that loan officer, that bumbling idiot who tried to call me.’ You know? I wanted it to sound confident.”

Lucky for Healy, he was able to secure a few solid connections with out-of-state agents, then applied his newfound knowledge to generating leads and referral partners face-to-face.

“A wise man once told me that the money’s not in the office,” Healy said. “The money's on the street and you gotta go get your money.”

There are plenty of ways originators can generate leads and carry a borrower to closing, but they can be boiled down to two main approaches. The “boots-on-the-ground” method involves walking up to people on the street or at a real estate broker’s office. Healy, who found his groove with this approach, now generates most of his leads through referrals, but started out by visiting Realtor’s offices, hosting first-time homebuying seminars, and attending networking events.

The second method? Cold calling. It’s not hard to understand the appeal: larger retail lenders can offer a bit more stability for new originators who are more comfortable working for a company that provides leads.

“Anybody who’s trying to get into the business, I would say go with the call center model. I think it's a great way to put the training wheels on and learn how to ride the bike,” said Nick Grobnagger, who is now the co-owner of a broker shop, Green Home Loans, with his partner Reggie Green.

In 2009, he joined Rocket Mortgage, formerly known as Quicken Loans, as one of their call center loan officers.

Prior to working in a call center, Grobnagger admits his career wasn’t nearly as stable. He entered the industry as a mortgage banker in 2005, and spent the first five years of his career working for various subprime lenders, which “kept on getting shut down” he recalled.

By the time 2009 rolled around, he had worked for five different lenders where either “this company shut down, or this one got bought out by another company,” he said, forcing him to recognize, “I just needed to get to a spot where I had stability.”

But Grobnagger achieved more than he could have imagined as a cold-calling loan officer. For nearly a decade, he was the top producing loan officer within Rocket’s call center. After gaining a reputation as an expert in lead origination, phone sales, and consumer direct mortgages, he now mentors hundreds of originators in the art of connecting with clients on the phone.

Pounding The Pavement: Look And Play The Part

Whether he’s walking into a Realtor’s office, a first-time homebuyer seminar, or a fast dining restaurant for a luncheon, Healy always shows up wearing a suit and tie.

“I tell all the young guns that are just starting in this industry to make sure you get yourself three suits: Black, gray, and, of course, a blue suit or a navy suit,” Healy advises. “Get yourself building that confidence, [and] not just in yourself, but [with] your referral partners and the first-time homebuyers that you're going to see face-to-face.” 

For the most part, loan officers are selling the same products, mostly conventional and FHA, with slight variations in pricing. What truly sets loan officers apart, according to Healy, is their ability to sell confidence. “That can come from the tone of your voice, your body language, what you're wearing. Also typically what you're driving,” he said.

On the other hand, there is such a thing as too much confidence. Healy uses the expression “all flash, no cash,” to warn his protégés not to go too far with their façade and end up giving the opposite impression.

“They rent their Lambos, Ferraris … they rent Corvettes,” Healy said. “[But] you really can't back up what you're saying. The information that you're trying to provide starts becoming diluted, and that confidence is not there anymore. It becomes almost cheesy, right? Because you're dealing with the person's largest purchase of their life.”

Matthew Healy admits the way he does business is “definitely old school,” but he’s someone who knows how to make an impression. Marching up to an agent in their office or a homebuyer touring an open house is the most direct approach a loan officer can take to generate leads. Healy believes it’s a sure-fire way to spread their name by word of mouth and become memorable to the person they’re targeting, whereas a friend request or message on social media is easily forgettable. 

But, interrupting someone’s day to make a sales pitch can also be annoying. That’s why Healy comes armed with treats to sweeten his offer. Sticking to his “old school” way of business, the most reliable trick in Healy’s book is walking into Realtors’ offices with a box of donuts in hand. 

“Listen, I've been kicked out of offices like every other salesperson on the street,” Healy admits. “[But] the donuts have gotten me through a lot of doors.”

A baker's dozen can feed a small brokerage and be a useful crutch for newer loan officers trying to forge connections with referral partners. It may be a bit stereotypical to dangle a treat in front of their faces, and it might come across as an oversimplified strategy, but according to Healy, simple works. 

Earlier in his career, Healy scored one of his best deals and a long-term referral partner shortly after walking into a random brokerage office called Off The Street. 

“I walked in — suit and tie, no donuts — said, ‘Hey, my name's Matt Healy. I'm a mortgage broker. Do you have any deals that you're looking at right now that just got denied or maybe are running into some issues?’ And right there, standing right in front of me was the buyer. They got denied by Wells Fargo,” he said. “I was able to increase his credit score by doing credit repair for free, and then [he] was able to go conventional to close on that deal. He still sends me referrals to this day as well as the agent and that office, just [by] walking cold off the street and mentioning the phrase ‘Are there any loans I can help you with?’” 

Cold Calling: The First Seven Seconds

The first seven seconds of a phone call can make or break a deal. Grobnagger knows this after nearly a decade of experience, but loan officers don’t have to take his word for it. Studies from the University of Wyoming School of Business have also found that’s roughly how long it takes for people to develop a first impression of someone new.

While working for Quicken Mortgage (now Rocket Mortgage) between 2009 and 2018, all of Grobnagger’s leads were company-provided and distributed from what he called a “hodgepodge” of lead sources. Some came from lead publishers and aggregators while others came directly from Quicken (now Rocket.com), along with a mix of other referrals. As a nationwide lender, those leads would be sourced from all across the country and came with little to no information about the client. Every phone call, as he described it, was a roll of the dice. 

“Within a few seconds, you have to look at what the lead source is and decide what your introduction is going to be, depending on where it came from,” Grobnagger said.

Over time, he became familiar with the demographic of more popular lead sources like LowerMyBills.com, where most people are looking to do exactly what the website name implies, either with a loan modification or a refinance. In such cases, it’s better to open the call by getting right to the point.

His opening line would go something like this: “Hey, my name is Nick, I got your information from LowerMyBills.com and I see you’re looking to refinance in this area.”

Open-ended questions are expected, but Grobnagger stresses not to pry for all the borrower’s information during the first phone call. Not only does it come off aggressive and untrustworthy, but the vast majority of leads come from people who have just started to think about the homebuying or refinancing process.

“The whole goal of the first call is getting them to trust me,” he said, which he does by explaining the value he brings to the consumer. As a mortgage broker, he often explains how they have the ability to shop multiple lenders and nearly every program on the market. 

Some call centers provide loan officers with scripts to keep their conversations speedy and productive. They would list the essential questions to ask, such as the person’s income, employment history, and if they have any debt. But, Grobnagger recommends using those scripts as loose guides and customizing them to be more conversational. 

“There's some stuff that you just have to ask, but that's not what gets you the loans,” he explains. “What gets you the client is not asking the questions that everyone else is asking. What else are you doing on the phone? How are you different from everybody else? That's thinking like a top producer.”

But going off-script doesn’t mean quoting interest rates on a hypothetical mortgage. He adds, “I would never quote or even ballpark figures on interest rates on the first call. You're just gonna end up shooting yourself in the foot.”  

There are plenty of times conversations end pleasantly, simply because the person wants to get off the phone. That’s why Grobnagger advises that it’s better not to assume a lead is fully acquired until their documents are sent. Once they have some skin in the game, he said they're usually pretty committed.

In Person: Repetitive Business

Although a box of donuts provides an easy entryway, there are no miracle strategies for getting someone’s business. Loan officers can’t expect to break the ice with a hammer. Most often, relationships are formed gradually, a fact that Healy says is also true for loan officers who take a direct-to-consumer approach. 

Healy mainly works with first-time homebuyers and real estate investors — a demographic that typically requires more attention and hand-holding. Those borrowers likely won’t be satisfied working with call center loan officers who are motivated to work quickly to increase their sales volume.

“When you're speaking as a first time home buyer, you're like a bull in a China shop,” Healy said. “You're relying on your aunt and uncle, your mom, your dad who are screaming at you throughout the process. It feels so overwhelming because they don't teach this process in school.”

It requires much patience to offer a hand-holding type of service, especially when juggling other clients. First-time buyers and new investors tend to ask more questions and desire more of an in-depth explanation on certain aspects of the mortgage process. 

It's also easy to get frustrated when the client repeats their questions after it's been explained four different ways. In such cases, Healy says the problem is not the borrower’s competence — it's how the loan officer is communicating with them. It can take months for a newly licensed loan officer to adapt to their job, so the average borrower and first-time homebuyer is bound to have a difficult time understanding. 

“I came up with a way of dumbing it down without losing the integrity of the answer,” Healy said. “I also have a policy with all my first-time homebuyers where if you don't know something or don't understand something that I say, don't ‘yes’ me to death. Even if you hang up the phone and you go, ‘Oh, I have a question for Matt, but I don't wanna bother him.’ No, call me right back, because I want everyone to walk outta here with a Ph.D. in mortgages so they feel confident about purchasing a house.”

Patience and solid communication skills are the essential ingredients to gaining repeat business. But newer loan officers might run into trouble when they don’t have an answer to a borrower’s question. Suddenly, the loan officer is taken off guard and fumbling to come up with a response, which can rapidly deplete the borrower’s confidence in them. 

The biggest mistake Healy warns loan officers against is lying and assuming what an answer will be. “Because if you give misinformation and it comes up and it bites you in the butt, then you look like an idiot,” he said. 

Instead, he suggests that loan officers tell their borrower that they’ll get back to them on any questions they can’t currently answer. For example saying, “These guidelines change all the time, so I’ll get back to you on that,” or “My underwriter is really quick, so I can get her on the phone and get back to you as soon as possible.” Then move the conversation along by asking “What's your next question?”

Unlike call center originators who get a fresh supply of leads every day, a boots-on-the-ground originator is focused on developing relationships with referral partners, including real estate agents and financial planners, to gain repeat business. While losing potential clients due to a lack of confidence isn’t as damaging as accidentally misinforming them, it can end up hindering a deal and make it difficult to maintain those referral relationships long-term.

Cold Callers: Boiler Room Experience

“Ninty-five percent of the time you're either not going to get someone. Or, if you do get someone on the phone, they're going to be upset,” Grobnagger said.

It should come as no surprise that most people don’t respond kindly to unsolicited telemarketing calls. Even though lead publishers are required to ask for an individuals’ consent before sharing their financial information to lenders and other solicitors, a number of website visitors don’t read the fine print before consenting. Because internet-purchased leads are typically sold to multiple other lenders, Grobnagger would find that he was not the first lender to call the prospective clients. 

“You should be surprised if you pick up the phone and someone's polite to you,” he said.

It’s a job that requires thick skin, but Grobnagger eventually discovered that he was a lot more successful when he was honest with consumers about how he got their information.

“I found a lot of success with just calling out the situation. I know you probably didn't expect to be getting a phone call, but that doesn't mean that we can't take a look at your situation and possibly help you out,” he said. “It’s like calling a spade a spade.”

When someone does pick up the phone, loan officers must be ready to make it worth the customer’s time. Out of 100 leads, Grobnagger estimates that only 2 or 3 typically convert into fully funded loans — “Maybe five if you're really good,” he adds. 

Likewise, CoreLogic’s data team estimates the average conversion rate on internet-provided mortgage leads to be between 2% to 3%. That’s a low conversion rate compared to most boots-on-the-ground originators like Healy, who’d have to spend a lot of money buying donuts before making a successful sale. But being hooked to an autodialler allows call center loan officers to brush through hundreds of phone calls per day, creating a wider range of opportunity for new originators to generate business.

The “Boiler Room” experience is simply a numbers game. Eventually, the right customer will pick up. It’s a grind, but Grobnagger says that most loan officers aren’t working overtime or even a full 9 to 5. After gaining some experience, he’d typically spend just four to six hours per day on the phone.

Conversations can go south quickly, but there are people who are patient enough to see if the caller can help. Still, loan officers must make their point quickly. 

“Can you help me out or not? And if you can say yes, then they'll listen to you. But if you can't say that within the first couple minutes, then the conversation's done,” Grobnagger said. “Kill them with kindness, ask open-ended questions, and see where the conversation goes from there.”

Upward Trajectory 

Most originators are utilizing both a cold calling and a boots-on-the-ground sales approach to avoid becoming dependent on one or the other. Even if new loan officers find success using one approach, there may be new conditions or regulations that may force them to switch tactics. For example, new TCPA regulations could have an effect on lead supply that most call centers rely on, and unforeseen events like the COVID-19 pandemic could prevent in-person encounters. 

That’s why both Healy and Grobnagger recommend that loan officers build up their skills to diversify their lead generation strategies and become a more dynamic salesperson overall. So, when loan officers are considering which sales approach to master first, they must evaluate whether that strategy or work environment provides them opportunities to progress their careers further. 

Originators don’t need to work in a call center to start cold calling clients and referral sources, but Grobnagger highlights some of the benefits those lenders offer to new originators.

 “You may talk face-to-face with four people per month, whereas in the call center environment, you're talking to like 40 people a day. So you're just going to get a lot better a heck of a lot quicker,” Grobnagger said.

Another benefit of the “Boiler Room”: call center originators don’t have to waste their Saturdays going to an open house just for four people to show up. According to Grobnagger, he can follow up on 150 leads in the same amount of time and likely walk away with a few new clients. However, he notes it can be challenging to take the training wheels off, adding that “a lot of people struggle when they leave that environment because that's all they know.”  

Loan officers’ best option for progressing out of the call center environment is by searching for a lender or brokerage that can provide some support in terms of training or leads. Options are scarce, but his Green Home Loans is one of the few broker shops to offer a hybrid approach where loan officers can receive a few leads per day to help build their referral network.

“We buy leads, we help them, we give them structure,” Grobnagger explains, describing the company’s culture as “a little bit of the call center environment, but we're not like breathing over their shoulders. There's autonomy.” 

But for anyone who struggles to articulate themselves quickly or are simply averse to starting out with a “Boiler Room” experience, then their best bet may be starting out with a boots-on-the-ground approach as Healy did. 

“Cold calling is an art by itself. Then some people are really good at cold calling, but they're horrible in person,” Healy said. “I was always a people person. I definitely strategized better face-to-face because I can see their reaction.”  

Ultimately, both Healy and Grobnagger suggest that new originators step into whichever environment they feel most comfortable in — but warn that whichever approach they take will entail its own challenges. If you’re pounding the pavement, the hours are long and the leads are up to you; if you’re dialing and smiling at a call center, the grind could get to you.

No matter which path new LOs pick, though, there’s no way to avoid hard work in the mortgage industry, especially for those just starting out. They’ll succeed only if they're committed. 

“People don't like the call center environment and they may say it's because ‘I don't like to be micromanaged.’ I think it's more about the grind,” Grobnagger said. “I think the truth of it is that people don't like doing the hard work. [But] if you can do those things, then you get better over time and it becomes easier and easier. You just have to not be afraid to do the work.”