7 Reasons Why Loan Officers SHOULD NOT Market to REALTORS
Written by: Joe Pahl
I know it goes against what the top mortgage marketing experts
and even your manager is telling you, but I would like to make a
case against marketing to real estate agents.
Now don't get me wrong. I am not implying that there is anything
wrong with real estate agents. A competent agent can help many,
many people in his or her career. I just don't think that
marketing to REALTORS should be our only option when trying to
find purchase business.
What I typically see happen is this: you beg and plead to get an
appointment with this particular real estate agent that you
would like to start getting referrals from. After five letters
and six phone calls, he finally agrees to have a lunch
appointment with you.
You get all ready and when you meet him for lunch, you give him
your best performance. You go on about how great you and your
company are, and how you can give him the best service around.
You beg and plead for his business, but he gives you a "we'll
see" and you are happy with how the meeting turned out.
Six weeks later he sends you a referral. It is a very
complicated lead. The referral just started a new job, he filed
bankruptcy a couple of years ago, and has no reserves.
You bust your butt trying to close this loan because you want to
look good to the REALTOR that sent you the referral.
You do your best, but the loan falls through. You don't get any
more referrals from that agent and all the time and energy you
put in to get him as a referral source is now wasted.
There has to be a better way to get purchase business, and here
are seven ways to do it.
1. Market to For Sale By Owners. The FSBO pool is always there
and when marketed correctly, can generate many loans. You see,
working with sellers directly creates a win-win situation for
both of you. They need to sell their home, but don't want to
lose a bunch of hard-earned equity paying a real estate agents
commission. You can help them with handling the buyers that are
interested in the home. When you get an appointment with a
seller, you explain to him that a majority of FSBO deals fall
through because the buyers can't get qualified. Convince him to
let you prequalify all buyers, and you have a referral source
for the next 30-60 days.
2. Market to financial planners. I knew this loan officer that
got ALL of his purchase leads from a very busy financial
planner. And the great thing about those leads were that they
tended to be with people that had their finances in good shape
(they have a financial planner). They also had larger assets and
income, and were therefore looking to purchase investment
properties, vacation homes, or bigger primary homes.
Establishing a financial planner as a referral sources will give
much higher quality leads than you can get from a real estate
3. Market to credit counselors. This is going in the opposite
direction of the financial planners leads. You will many more
leads, but you lose much of the quality. These will be complex
and challenging loans that you would probably charge extra on.
An option for many people who are going through financial
difficulties is to sell their current home, and buy something
smaller. I saw this a lot with women who were housewives and the
got divorced. Now they have a home (and a mortgage) that they
just can't pay on their income. You can help them with the
financing of a smaller residence. Keep in touch with them
because when they become established again, they are going to
want to buy a larger home, and will need your assistance again.
4. Market to human resource managers. I read somewhere that
employees that own their own homes have fewer instances of being
late to work, work harder, and are much less likely to quit
their jobs than their renting co-workers. And this is the
selling point you are going to present to the HR Manager. You
want to express that you can help their company and their
employees but helping them ALL own their own home. Emphasize
that you will be handling all the work, and that it won't
interfere with employees on the clock. Here is a GREAT TIP if
you can convince the HR Manager to allow you to put inserts
along with their paychecks. The insert would be for a free
consultation and $250 closing costs. All you would need is for
2-3 HR Managers to agree, and you would have a strong purchase
5. Market to renters. Many renters that I have known were
unaware that they could be living in their own home right now.
For whatever reason, they were given a lot of mis-information
about what it takes to qualify to purchase a home, and have
never really looked into it. Here is another idea that worked
well for me. You are going to do a postcard mailing to a
targeted apartment complex near you. It will simply state, "For
what you are paying in rent right now, you could be living in a
$120,000 home. Call me today for a free consultation, and I will
tell you the steps you need to take to own your own home." Trust
me, you will get a ton of calls. Many people won't people to
qualify at this point, but you can give them a plan on how to
improve their finances and possibly qualify them later when they
are ready. But you will get another group who can qualify, but
never thought they could.
6. Market to your past customers. In this instance, I would use
a direct mail campaign with a checklist letter. Many of your
customers may have thought about purchasing more real estate,
but it wasn't a strong enough concern to warrant calling you for
advice. In this letter, you are going to ask them to call. You
are going to say something like, "Right now is the perfect time
for buying a home. If you have questions about any of the
following topics, please give me a call this week." You will
then have a checklist including several reasons why someone who
need financing assistance like: buying investment property,
buying a vacation home, buying a second home, purchasing a
smaller home because the kids have moved out, purchasing a
bigger home because the family size is increasing, etc. And
please make it easy as possible for them to contact you to get
the largest response.
7. Market to builders. This is similar to marketing to FSBOs
except that this would be on an ongoing basis. Most builders
that I know don't really like dealing with the selling and
financing of their homes. They want to focus on what they do
best, which is building more homes. Being able to partner up
with a successful builder would provide you with many, many
leads. Not only will you be helping those who want to purchase
the new construction home that the builder is selling, but you
will be helping many MORE of the people who aren't interested in
that particular home, but are still want to purchase.
So do I think that you should never market to real estate
agents? No, I just believe that it shouldn't be the first or
only option that mortgage professionals turn to. As you have
seen above, there are so many other possibilities to find
referral sources for purchase loans. And once you establish
these referral sources and can develop working relationships
with buyers before the REALTOR does, than you will now have
control of the situation and you will start to get real estate
agents calling YOU for business.
About the author:
Joe Pahl is a marketing consultant and co-creator of the Loan
Maker Gold System for Loan Officers. To learn more marketing
strategies targeted at loan officers and orginators, please
visit http://www.LoanMakerGold.com or send an email to
firstname.lastname@example.org for a FREE marketing eCourse.
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