As published in Scotsman Guide's Residential Edition, May 2011.
With all the changes the mortgage industry is undergoing, mortgage brokers may feel lost at sea. Instead of allowing yourself to drift, though, it's time to set your sail and reclaim your business.
The key to building your pipeline lies with your client base. Here are some tips for increasing your business by building a strong client base.
First, start by setting clear goals on how many loans you want to close in a certain time frame. Write them down, and then break each goal down by originations and fundings per month.
Now you know your desired closing ratio. You must determine exactly how many loans you have to originate each month and each week to attain that ratio. Let's say you want to fund 100 loans in the next 10 months — that's 10 per month. If your closing ratio is 90 percent, then you must originate about 111 loans in that time frame.
Next, consider and list the potential sources for these loans. Generally, you need six sources that are good for two loans a month each. You probably can think of that many prospective or current clients off the top of your head.
The next thing is to look hard at your client base: Is it narrow or diverse? Somewhere in between is good. Stay diverse enough to be unaffected by one area but focused enough to have a clear view of the clients you cultivate.
Now, you have written clear goals and a client list to help attain those goals. The next step is to put your plan into action. Start with the clients with whom you are already working and turn the service candle up. Give them the first-class service and communication that will set you apart from your competitors.
Simultaneously, start developing past clients who have fallen back to customer status. They will give you the time needed to refresh and revive that feeling of trust, and the business will be there in a short time. Remember, the No. 1 reason clients leave is that they think you don't care.
With these two groups in place, it's time to start developing new clients. A new client can come from many sources. Consider the three-loans-in-one principle. The next time your best real estate agent partner gives you a loan, give exceptional service, and the seller's agent will be an open prospect to whom you can also give exceptional service — loans Nos. 1 and 2.
During this process, ask your client to refer you to a friend — loan No. 3. Use every opportunity to tell people what you do. Give them a business card, and you will plant the seeds for the third loan.
To achieve your goals, you must do something to improve your business every day. At the end of each week, measure the distance you are to your goals. Look at and honestly assess your progress in the three areas of client growth.
Finally, be consistent — this cannot be overemphasized. Being consistent breeds credibility and makes the transfer of trust flow naturally. Trust will bring you loyal clients for years to come.
Jim Shubin has been in the mortgage industry since 1975.
Currently, he is a loan originator with Evergreen Home Loans in Apple Valley, Calif. Shubin has owned net branches, been a regional wholesale-banking vice president, and trained hundreds of loan officers and branch managers in the Southwestern U.S. Reach him at firstname.lastname@example.org.