I'd like to see the loan officer who consistently converts prospects into borrowers simply by providing great service, especially in this market. I'm not knocking service. I like dealing with pleasant people who are professional and on time. I like people who go the extra mile and I like it when salespeople remember my kids' names. I'm just not sure that would be enough to make me choose one loan officer over another.
The truth is, we work in a market where a lot of folks are convinced that the lowest rate equals the best deal and where the mortgage decision is considered a commodity. We're dealing with an economy where lots of people are still losing their homes and many are lacking confidence in their financial futures.
If people in this type of an economic climate think their one deciding factor—the almighty interest rate—is the key to making the best financial decision about their mortgages, you'll be hard pressed to provide service levels that can make them think otherwise. You can't counter that intense financial focus with great service. Great service should be a given, not a differentiator.
The good news is, as originators, there actually is something you can do that can snap a prospect out of a rate shopping mindset. It is absolutely possible to consistently convert prospects into borrowers in a single phone call, all the while distinguishing yourself from your competition. You can do this by providing obvious value.
You may be wondering: So, what does that mean, exactly? Good question. Let me explain. You need to provide your prospects with information that can make a meaningful difference in their lives. That information has to be truthful, relevant, and easy to understand. The mistake that many originators make is that they simply respond to borrower questions—and most borrowers rate shop. Borrowers ask about rates, fees and maybe annual percentage rate.
Originators assume that by giving borrowers what they're asking for, they're providing service and value. They're not. Borrowers simply take that information and use it to compare lenders. And often times, the originator with the lowest rate wins—even though the borrower may end up with a loan that is not the best option.
Borrowers want to make the best financial decisions, but most are not knowledgeable enough about personal finances to know which pieces of information will actually make the biggest difference in their financial lives. They forget that money itself isn't what's important. It's what you do with it that is.
If you provide your prospects with information that demonstrates how one or two different programs will impact their lives, you have created value and you've probably earned yourself a customer.
A lot of originators provide comparisons between loan programs. That's not what I'm talking about. Because by telling someone that interest rate A will cost B dollars each month with C dollars in closing costs, while interest rate X will cost Y dollars each month and Z dollars in closing costs, you're not really providing any relevant information to the prospect.
However, if you show that person how much a loan program will cost over the life of the loan, or how they can pay off their loans faster, or what types of efforts it will take to get to that “freedom point,” when they will be financially capable of paying off their mortgage altogether, then you've created value.
It's the difference between selling someone a loan and helping borrowers not only actualize their financial goals, but also make the smartest decisions for what will likely be the biggest investment they will make in their lifetimes.
When providing this information, don't overlook the value of the presentation. The bottom line is that information is only valuable when it's understood.
Let's say you help explain certain points to your borrowers by taking out your trusty legal pad and jotting numbers down. Maybe you get creative by using arrows and circling some of the more pertinent or important points.
Do you honestly think that your prospects are going to decipher your diagrams and remember what you were talking about when they to review that piece of paper a few days later?
If you want to get maximum value out of the information you provide to your prospects, try to use software that presents, on screen and on paper, all of the relevant information in an easy-to-read, visually pleasing format. Give your prospects something that they can read and understand at a glance.
With originations expected to drop in 2012, originators will be vying for even fewer pieces of the pie. If you want to convert prospects to borrowers, do yourself a favor. Stop relying on customer service and start delivering obvious value.
Give prospects information that is truthful, relevant and easy to understand, especially when your competition is still hogtied to legal pads and rate quotes, and chances are, you've got yourself a customer.
Dave Savage is chief executive of the Mortgage Coach. For more information, please visit
