Posted by John Scott Smith on Tue, Mar 09, 2010 @ 03:32 PM
Remember The Waiter Rule? It says that you can learn a lot about my character by how I treat the waiter. The waiter rule exists for a very simple reason: I already know how you're going to treat me to my face. What I want to know is are you looking out for me. Are you concerned about my outcome? Or, are you just in this for yourself?
Particularly after the housing meltdown, customers are leery. They are suspicious of mortgage brokers. After all, they don't really want a mortgage: they just want a house. Our customers are looking for clues, any clues they can find, about who we are and how we'll treat them. Of course, the good news is that means that every single person on our team has the chance to turn the next prospect into a lifelong customer.
I'm a parent of young children which means that going out to dinner can sometimes be...challenging. Recently, when we were at a restaurant the boys were being very good, but it was getting a little late for them. I ordered my burger medium-rare. (Yes. I know. I live on the edge...) Sadly, when it came, it was way overcooked. No biggie. I'll just eat it so we can get the kids home.
The waitress made her routine rounds and asked me how everything was. I just said, "fine," and went back to eating. A moment later, she was back with the manager. The manager said, "Julie (our waitress) told me that she thought that your cheeseburger came out overdone."
"It did, but I hadn't even said anything."
"That's no problem. She noticed and asked me to come over and make it right for you. Would you like me to bring you another one? Or, can I bring you another beer, on us?"
Talk about "above and beyond!"
Julie has a thing or two to teach me about sales. She probably has a thing or two to teach all of us, really.
Look out for our customers. Even when they say that everything is okay, make sure they're taken care of. And, of course, they'll be back. With friends. Besides, after that experience, where else would I go next time? Where would you go?
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Posted by John Scott Smith on Mon, Mar 08, 2010 @ 12:59 PM
Are you a parent? I am. Of two young boys. My oldest is two and a half years old, and is no longer into Elmo, Big Bird, and "Sesame Street". He's moved on to "The Wiggles." Now, that's what we watch, right before bed, as part of his nighttime routine. When he shouts, "It's our SONG!" as "Rockabye Your Bear" comes on, it kind of melts your heart, no matter what my day was like.
Curious, I did a little research on "The Wiggles" and found out something that hadn't occurred to me: "The Wiggles" weren't always "The Wiggles". They had been aspiring musicians, each with a different level of success. After leaving music, three of them met while working on degrees in early childhood education. They had been studying to become teachers.
Money quote from the a New York Times article about them, Murray Cook (one of the founding members) "I'd played in rock bands and didn't get anywhere in the 80's."
For their school courses, they made a music project incorporating early childhood lessons with original music and dancing. And, it caught on. Caught on in a BIG way. (In 2005, they raked in forty-five MILLION dollars from their CD's, concerts, and merchandising.)
What does this have to do with mortgage sales? Pop music was a tough market. But, by discovering an unfilled demand in the marketplace for quality children's music, they got to perform for larger audiences in more venues making a LOT more money.
Right now, amidst this mortgage wreckage, there are still underutilized skills, and market demands that are not, yet, met.
Where can you specialize and make more money? Your unique patch of grass has its own answer, but foreclosures aren't going to end any time, soon. What if you learned everything there was to know about getting people financed to buy foreclosures? Do you know enough, yet, to give an informed presentation on FHA 203K mortgages to your local Realtors Association? On a more basic level, do you know everything there is to know about the changes taking place with regard to FHA mortgages beginning on April 5th?
For a living, I have to stay up on all changes to FHA, so I read several articles per day for my work, here. I am constantly amazed by how much information I find out there that is flat out wrong on ActiveRain and other real estate sites.
If you're still in the business, there are unexploited areas that offer less resistance for those who study and do their homework.
Right now, most of us are struggling pop musicians. Maybe it's time we became "Wiggles".
What do you think? What areas can expand into in your area?
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Posted by John Scott Smith on Thu, Mar 04, 2010 @ 02:08 PM
Whatever business we are in, whether our customers are verbalizing that question or not, THAT is the question that they are trying to answer. "Can I trust you?" In order to offer evidence is why we get licensed. Or, join the Better Business Bureau. Or, ask others to vouch for us.
In a weird, Zen-elusive kind of way, if you think too much about the question, you won't be able to convince anyone of your honesty or your integrity. You have to let it go, and be yourself. Allow yourself to connect. That connection is what builds trust.
In the mortgage industry, product knowledge is useful, so learn it. Availability is helpful, so answer the phone, reply to your emails, and return you messages. But, connection is what people crave and what will lead to higher success.
How do we build that connection? Be sincere. Share your experience. Learn about your customer's needs and keep their needs at the top of your mind.
Before I started in mortgage lead generation, I sold mortgages. Often, I was so focused on getting my customer the right product or pricing it correctly, that I forgot about their anxiety about whether or not they would be approved.
One of the biggest advances that I made in my selling career was when I helped them address their feelings on this. Now, I didn't use any "when you, I feel" statements or anything overly "touchy-feely". What I changed was one simple behavior. When I got a DU "refer/eligible" on a pre-approval, I made a commitment to my customer. "We'll have an answer for you within three days." (That was our timeline, back then.) "In the meantime, I am going to call you with an update, each day, even if that update is to say 'there is no update,' until we have an answer." Of course, once I laid down that bridge, I had to walk over it, each and every day. That daily effort was what built the trust. And, that was what got my customers to commit to working with me.
Someone else may have had an eighth better rate, or a quarter of a point less in closing costs, but I had already had several conversations with my customer. And, I had proven myself to good on my word.
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Posted by John Scott Smith on Thu, Feb 25, 2010 @ 12:16 PM
Monday, I was prospecting for business calling on a customer that I hadn't spoken to in a while. Apparently, I still had his personal cell phone number, so I was able to reach him. After fifteen years of being a mortgage broker, he had decided to get out of the business. Fifteen years....It had become that hard to make a living at selling mortgages, and he didn't see any changes coming down the pike.
The mortgage industry has gotten brutal for everyone in the business. We all feel the pain. There are fewer deals to go around and competition is fierce. Branches are shuttering every single day.
I have found and want to share with you some effective and inexpensive ways that you can help shore up your business.
There are several different companies offering complimentary marketing and sales training that can be applied to the mortgage industry. And, from what I've seen, HubSpot has some of the best.
Are you using LinkedIn to promote yourself? What comes up when you Google your own name? Are you on Facebook?
In this industry, often your fees are what they are. The rate shifts, daily. But, one thing that you have control over is your reputation. And, getting it out there, proudly and prominently, is what today's seminar at HubSpot will be about.
The link is here and if you don't catch it live, I know that it will be posted to view later and for all time, because at HubSpot, that's just how they roll.
Use your social media platforms to promote yourself, so that when your prospective customers Google your name (and, you KNOW they do!) they'll be able to see all kinds of things about you: that you're a tee-ball coach for your kids, that you sent that letter to the editor of your newspaper, that you have a gazillion endorsements on LinkedIn. Be easy to get found, and get found for the right things.
Customers want to work with a real person. They want someone they can trust. Let them see that you're real. And, LinkedIn is one of the ways to do that.
Join the conversation. Comment, below. Tweet. Call us out or voice your support.
Follow us on Twitter or Facebook to participate and stay informed on the latest developments, news, and policies affecting the FHA and FHA mortgages. Follow the author, John Scott Smith, on Twitter.
Posted by John Scott Smith on Thu, Nov 05, 2009 @ 10:50 AM
Before you answer that question, answer this one: do you like to receive handwritten notes? How about those "thank you for helping me get my mortgage" letters? We especially love the ones that people send with a picture of their family in front of their new house. Those get posted in your cubicle. We love it!
Relationships are what get us business, and handwritten notes (along with timely phone calls, professional care, and personal concern) are what build those relationships.
The thing is that you're reading this online. Most of our reading is done online, now. Emails, blog posts, newspapers all make it faster to connect, but less meaningful. One of my favorite tongue-in-cheek business slogans comes from "someecards" where they brag,"when you care enough to hit send". Cute, isn't it?
My point is that when you want to stand out in the mortgage industry, one inexpensive but effective way to do so is with handwritten letters and cards. They really don't take much effort, but they make a significant, lasting impression.
If this is something that you'd like to start doing more often I have found a few ways to make it easy on myself. Maybe you will find this helpful, too.
- If you're having a hard time getting started, pick up a copy of "Business Notes: Writing Personal Notes That Build Professional Relationships" by Florence Isaacs There are excellent examples of short notes and letters in Isaacs' book, and she covers every business occasion that I have encountered. I refer to it often when I'm sending out my own letters.
- Pick up some stationary. There are inexpensive but nice letter-sized papers and envelopes at Hallmark, Papyrus, and even Whole Foods. Get a stash and keep it in your top desk drawer, along with a book of stamps.
- Write out holiday cards right after you close each mortgage. Make them friendly with at least one personal comment about your customer, their kids, or their pet enjoying their new home for the holiday. Collect your stack of these until Black Friday, and then drop them all in the mail to spread the cheer and remind your customers that you exist, that you're thoughtful, and that you care. (Special tip here: on the day after Christmas, I go to Hallmark with my wife. While she gets ornaments and wrapping paper, I pick up several boxes of the nicest holiday cards I can find for next year's batch. They're priced at 40-60% off, and they are sitting in my bottom desk drawer, right now!)
- If you'd like to really get into writing, you can even order special stationary or a nice pen. In order to make my letter-writing as natural as possible, I've indulged in personal stationary and a heavy fountain pen. When letter-writing is a delight (and, much more pleasant than sitting in front of the computer) it comes easily and more often.
Besides remembering and using someone's name after being introduced, I've found that sending out handwritten letters makes the next biggest impression.
So, what do you think? Too "old-school" or out of fashion enough that it works? I'd love to hear your thoughts.
If you'd like to listen to my electronic ramblings more frequently, I'm on Twitter and facebook. If you'd like a personal, handwritten letter from yours truly, become a customer! ;)
Posted by John Scott Smith on Thu, Oct 22, 2009 @ 04:04 PM
You do it. We know you do it. Let's just get this out of the way and say it: you produce your OWN leads. (Not to the exclusion of us, of course, or you wouldn't be here, but you do try.) And, that's okay. In fact, I encourage it.
For most lenders, buying mortgage leads is, and, should be, a complement to your other marketing efforts.
You work open houses with comfort and charm. You teach first time home buyer seminars brilliantly. You produce a beautiful and informative newsletter (that even other agents read!). And, you have a compelling web page where you want to harvest your own leads. So, where the hell are they??
This is where you, the knowledgeable and accomplished loan officer, banker, or branch manager will often fall down. But, it's not your fault. Really, it's not.
Lead generation is its own science. Being good at these other things does not, in any way, imply being good at harvesting leads: in fact, it's being good at those other things that is probably getting in your way. So, together let's take a step back, and let me share some of the "secrets" of mortgage lead generation.
- Don't ask too much. It's tempting to have your prospects fill out a full 1003 on your webpage, but it's also unnecessary. And, it's counterproductive. Your goal is to eventually get them on the phone or into your office. All you need for that is a name and a phone number. (And, an email address would be nice, too). Asking for more information, especially a social security number, leads to what those of us in the business like to call "form abandonment", and, yes, it's exactly what it sounds like. Shorter equals more likely to be completed. Period.
- Get found. Use long tail keywords. Yes, you read that right: "long tail keywords". (And, of course, I'll explain what that is.) The HUGE lead generation companies (you already know who they are) spend tons of cash on the most general and most difficult to optimize keywords in order to be found on the search engines. "Mortgage." "Loan." "FHA." These terms are not only too difficult for you to use and be found by, but they are far too general to be of any good to you. You don't want hundreds of leads from all over the country. So, what about having a part of your web page with the title of something like "mortgage loan for Bethalto, IL" which would look something like this: www.joesmortgages.com/mortgage_loan_for_Bethalto_IL With some decent content, our fictional friend, Joe, stands a very good chance of ranking highly for all of his target customers in Bethalto. Likewise, Joe can work on Rosewood Heights, and Roxana, IL, too. This is what long tail keywords are: longer, more descriptive variations of the big keywords, likely to get you the prospects that you want to turn into leads.
- Nothing flashy. In fact, don't use Flash, at all. I don't like it. At least, not on your page. (Nor, on mine, for that matter.) Have a basic, professionally-built webpage that looks smart and timeless. You don't need distractions. You certainly don't want music that will clue your prospects' employers in to the fact that they're surfing your page while on the clock! Your customers are there for your brilliant content and your reassuring voice. Leave the fancy stuff to the Amazons and the Mercedes of the world.
- Remember your audience. The most common mistake that I see on bankers' and brokers' sites is that they are writing their content to the wrong people. In layman's terms, describe the home buying process. Or, the mortgage application process. Or, the closing process in your target area. Mentioning "supporting documentation" and "1003's" are what we, in the business, do every day. Your customers generally don't know that language, and, more importantly, they won't respond to it.
- Use a pay per click (PPC) campaign. ALL of the pros are running PPC campaigns. Every single one of them. And, most amateurs, too. With Google, it's shockingly easy to get your own campaign started. AdWords at Google will walk you through the whole process of getting your account set up. A couple of quick suggestions which I can add (which may well evolve into an entire other post): choose which page on your webpage that you want people to land on, set a low daily budget, remember what we said about long tail keywords by picking as many of them as you can think of (and, as Google can recommend) when you get started, and (in the name of all that is RIGHT!!), don't ever, ever forget that your campaign is running! Costly mistake. Been there. Done that. Would rather have bought myself something nice...
There you have it. As I read this over before hitting "publish" I fear that I may come across as preachy. I apologize in advance if I do. Instead, I would like to be helpful and approachable.
So, what are your thoughts? How is your own lead generation coming? What other questions do you have for me? Ask, and I'm happy to share what I know.
(As I've said before, you are welcome to follow my constant "stream-of-consciousness" updates on Twitter and facebook .)
Posted by John Scott Smith on Tue, Oct 20, 2009 @ 01:11 PM
I admit it. I'm on Twitter. I'm on facebook. I read and comment on blogs. Struggle that it is, I try to send only "good" Tweets, and avoid contributing to the pointless babble with which these networks are wrought. I do all of these things with the stated goal of promoting my business, but, mostly I do it because it's fun!
Traipsing through the Internets, it will seem that everyone talks about how invaluable these services are to business. Many real estate agents and loan officers out there saying that social media are important to them, too. But, how are they important?
The very best description that I've heard of the usefulness of social media for most of us was from an interview with legendary social media expert, Chris Brogan, when he spoke on HubSpot TV. Brogan explained that social media was a great place to keep people (leads, customers, prospective customers) warm between meetings with them. That's it.
My thoughts are that Twitter, facebook, et.al. are an excellent way to interact, lightly and occasionally, with your leads and customers, but probably not a very good way to get new customers.
What do you think? How are you using social media for your mortgage business?
(By the way, if you would like to read my very own brand of pointless babble, I can be found on both Twitter AND facebook.)
Posted by John Scott Smith on Thu, Aug 27, 2009 @ 09:35 AM
What is the difference between a loan officer who closes 4% of their leads and one who closes 5%? It could easily be twenty-five thousand dollars per year, or more, and the methods can be simple and painless.
Every day I speak with lenders who are looking for leads. And every day, I ask them the same set of questions. How do you manage your leads? Are you using a CRM (Customer Relationship Management program) like Leadmailbox, Leads360, or Kaleidico? What do you do with your prequalified leads if you don't have a real estate agent to send them to?
The vast majority (over 90% of our customers and prospective customers) do not, yet, have a plan for leads that are not ready to pull the trigger.
Designing answers to these three questions can bump up your closing rate, your gross revenue, and most importantly your commission by having a short, boilerplate "treatment plan" for each type of lead that you encounter.
If your lead is ready to move forward, you already know the drill. We don't need to discuss that because that's why you're in this business, and why you make money at it. That's your 4% closing rate in our example. What we are going to focus on in the next couple of paragraphs is how to drive that number up to a 5% closing rate or higher.
We've all missed deals because we didn't get back to someone soon enough. Or, because the lead lost our phone number. Or because we got busy and didn't follow up. Think of all of the reasons that you DON'T get a deal with a lead, immediately, and put those reasons into simple categories. Yours may well be a variation on these: purchase, no property; not enough money for downpayment; not working with one of "our" real estate agents. Let's discuss.
Treatment plan: keep track of all leads.
Bill Rice, the CEO of the mortgage CRM, Kaleidico, freely shares that the most simple lead management tool that you need in order to improve your closing rates is a pen and pad next to your phone. Setting a legal pad and pen next to your phone will ring the cash register. Keeping track of who calls and never abdicating that job to your memory or scraps of paper is going to make sure that you don't let leads fall through the cracks.
Treatment plan: figure out a next step, and commit it to your calendar.
Your first contact with lead can be a very rudimentary pre-qualification. Now, your next step is to pull credit and make sure that things are as they seem. Before you leave, they leave, or you hang up the phone (depending on how this conversation is taking place) get a commitment and an appointment to meet, if appropriate, or schedule your next phone call. If your lead is supposed to call you on Thursday at 2 pm, then ALSO put in your calendar to call THEM some time after that appointment, in case they don't follow through. By making sure that you have a clear, next step in your appointment book, you ensure that you do not lose track of someone who could be one of your next deals simply because they forgot to call you back at their appointment time. Do this at each and every step in the process all the way to the closing table, and you will free yourself up to focus on the work at hand. Your calendar will become your guide telling you what to do, and when to do it.
Treatment plan: set up a real estate agent referral system.
If you already have a real estate agent in your zone of influence to whom you can send your prequalified lead, of course that's your next step. But what about when the lead is looking in an area in which you do not have a real estate agent to send them to? Relocation programs can drive more business back to you and your branch. Set up a relationship with a relocation program so that when you need it, you can send your lead to the program and they will take care of getting your lead set up with an agent.
Here at MyFHA, we can provide that relationship for you with our relocation experts at Cartus. In utilizing the service, you send over a short form saying where the lead is looking and how much of a purchase price they are qualified for, and Cartus takes care of the rest. Further, Cartus, and many other relocation services have a reciprocal agreement set up so that the agent is bound to send the leads BACK to you to get the mortgage once an offer has been accepted. This step with save you time and make you more money.
When you invest time developing lead management strategies, you will have an easy time actually managing those leads: put them into your systems, and do the next, right thing.