As published in Scotsman Guide's Residential Edition, November 2005.
Selling is an art, a skill and a learned method. To sell successfully in your own style takes practice and education. Converting a customer contact into a loan application is part of the art of selling.
An important, basic part of any sale is initial contact. Early in the sales process, loan officers must talk to clients on the phone or face to face. The first seven seconds of the first contact is vital to a successful sell. The next week is just as vital.
Follow the formula
How does a loan officer develop a 100-percent conversion rate of contact to contract? The first step is to use "the formula": benefit minus cost equals value. This concept is an often-overlooked, basic marketing concept. Let's break it down:
Cost is a constant in the formula. It may fluctuate from company to company, but the actual cost of doing business is generally the same across the board. If we keep origination at a constant (say 1 percent) and add processing, underwriting, title fees, government fees and closing fees, the good-faith estimate should be similar among companies. Cost can also be measured in non-monetary terms, such as the time involved, emotional elements, travel time or customers' efforts to gather necessary documents. Because the cost of doing business is constant regardless of with whom customers do business, the variables within this equation are benefit and value.
Benefit is the only thing loan officers control in this formula. The benefit is anything the customer receives in a business exchange. Control this, and you have the key to meaningful contact with customers. Without benefit, there is no value. That is, if benefit is zero, then the value is negative. If the benefit is the same as the cost, there is zero value. If the benefit is substantially greater than cost, then the value is great.
Value is customers' perceived benefit in the transaction. Loan officers have no control over what customers perceive to be "of value." Loan officers, however, can control how to gain the necessary information from customers about what they hold dear in the transaction. Customers' goals for transactions will define their baseline for value. In other words, if they get what they want as a minimum, then the value is zero. Anything they get beyond that is a value-added proposition. The more benefit provided to customers, the more perceived value they gain in the transaction, and the greater chance of getting them to sign an application.
Considering this formula, how do you glean information from customers to discover their definition of value? This is where I always insist on meeting clients. I typically meet them at their house after business hours. Often, this is unnecessary, but for busy professionals who have no other free time during the week, you can add a huge benefit by visiting them at their convenience.
Another option is simply to enclose a cover sheet with a brief, understandable description of the documents when you mail or e-mail them to customers. Benefit can come in the form of a numerous simple actions, based on customer needs.
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