How one successful originator is developing “raving fans.”
Ten years ago when I started in the mortgage industry, $100 million Mortgage Originators seemed to be more an “urban legend” than a reality to me. Just like when Roger Banister broke the four-minute, the initial $100 Million Originators have raised the bar for the entire industry. It took the combined first six years of my career to originate a total of $100 million. In 1992,Todd Duncan Seminars introduced me to the concept of the super originator. Todd Duncan helped me to dream big. Thanks to Todd, I finally joined the “$100 Million Originator Club” in 1998. And this year, I have already closed $100 Million personally in the first six months.
Building a referral by design business was the key for me becoming a top originator. One “raving fan client” at a time, I have grown my business 99.9% by referral. As I network with other top originators around the country, the common “secret of success” is building a referral business, largely based on outstanding customer service.
Referral Service
Referral Service is a personal commitment to wowing your customers by providing the best service imaginable. Disney, Ritz-Carlton and Nordstrom are examples of companies that are truly passionate about exceeding client expectations. Far too many mortgage originators think like traditional salespeople, rather than entrepreneurial business owners. Create a big hairy audacious goal for your business. Defy the odds, set a new standard and step-up to outstanding service.
In today’s competitive mortgage environment, satisfied clients are not good enough. In fact, having your clients just satisfied will bankrupt your business when rates go back up and the refinance boom ends. You can’t afford to have clients just satisfied, because there are too many originators competing for the same client in a purchase market. Your goal is to create raving fan clients. You want clients so thrilled with you that they are literally running up and down the halls of their office singing your praises and referring you to everyone they know.
An inspiring three-year vision for all of us is to double our net income and double our time off by implementing a world-class, turnkey mortgage system that predictably creates clients for life and generates referrals by design. My personal mission is to set the standard of service excellence and to care more for my clients than anyone.
The goal with referral service is to wow and delight your clients and compel them to become raving fans for you. Commit to delivering world class service. For us, world class service means spending time with customers to answer their questions, taking an educational/financial consulting approach, keeping them constantly updated on loan status, and of course, fast turnaround time. We do much of our business via mail, so meeting and greeting in our office isn’t a big issue. However, for many originators, welcome signs, coffee and rolls, and soothing music are part of the application time customer service environment.
Develop predictable systems that guarantee excellent service. Consistently let your clients know that you value their business. Systemically let your clients know that you appreciate their referrals. Build your system so that you are communicating your vision and a heartfelt message to your clients on a regular basis.
Once you have a compelling vision and a clear mission, you’ll be in a position to grow your referral business.
The Point of Sale
Referral Selling is going beyond value-added selling to “wow selling.” According to Dave Savage, the CEO & founder of Mortgage Coach Software, the first step to building a referral business is to wow your customers at the point of sale My team goes out of their way to make clients feel special when they arrive at our office or when they talk to me. My team members use the following script: “Hello, you have reached Steven Marshall’s office, this is Patti, can I help?” When I am unavailable, Patti will respond to the client, “Steven is with clients, I am his senior processor, is there something I can help you with?” The key is that my team never says that I am on the phone, or unavailable, or in a meeting. They always say that I am with clients. When I am actually talking to the client, I go out of my way to make the customer feel appreciated and valued. I devote all of my attention to the client. I know of several other $100 million loan officers that are working two phone lines and one cell phone at the same time. I believe that this sends the wrong message to the client. I don’t want my clients feeling like I am too busy for them. I want to send the message to the client that they are my number one priority. I want them to feel valued and appreciated. And most importantly, I want them to know that I want my referrals. Too often mortgage originators consciously or unconsciously sent the message that they are super busy and don’t need the client’s business or the client’s referrals.
Top originators (and good friends of mine) Jim McMahan and Tim Broadhurst have mastered the art of scripting their team’s and themselves during the initial conversations with clients. There is much to learn from professionals like Jim and Tim on the power of wowing customers at the point of contact. For example, clients will bring up the “interest rate question” in the first two minutes of a conversation. Why not create and memorize an eloquent script that effectively handles the questions. Here is just one of the many scripts that Tim and Jim have taught me: “There are really two ways to look at rates—quoted and real. Many lenders today will give you a quoted rate. It is not always a real rate. My goal is to help you make smart choices when selecting the right loan and the right rate and through integrating the loan and the rate into your overall lowest cost of borrowing. Based on that commitment, do you feel comfortable moving forward?” The key to professional selling is to prepare in advance for the objections that we experience on a daily basis.
The best way to wow your customers is to position yourself as a mortgage planner. When I meet with my clients, I also help them understand that I see my role differently than a traditional loan officer. As a mortgage planner, my role is to help them integrate the home loan that they select into their overall, long and short-term financial and investment goals to help minimize taxes, improve cash-flow and minimize interest expenses. I find out what is really important about a home loan to the client. I position myself as a “highest value needs” consultant, which again, is a key part of our customer service philosophy.
When I meet with clients, I also help them understand that my goal is to create an outstanding loan experience. I want them so thrilled with the level of my service that they refer their friends and family to me. I let my clients know that the greatest compliment I ever receive is a personal referral.
I consistently tell my clients that I appreciate them, and value their referrals. I want my happy clients to understand that they are my greatest assets. Too many of us get busy closing loans and send out the unconscious message that we don’t need or want any more loans. Instead, let your clients know that if any of their friends are thinking of buying or refinancing, that you’d love to be of service to them.
Service Systems
Recently, I was talking with my business coach, Daniel Harkavy, the CEO of Building Champions. Daniel made a very important point. If you don’t close your loans on time and manage and exceed people’s expectations, you’ll never build a referral-based business. Often, we get so focused on originating loans, that we forget the most critical part, making sure that your clients are happy with the way the loan was processed and closed.
With the huge volume of loans clogging up the back-end underwriting and funding systems today, it is a challenge to wow your clients with the loan process. In today’s market, securing a home loan is like going to the dentist and getting teeth drilled. All we do is shot our clients full of Novocain and try to ease the pain.
My company’s goal is to anticipate problems in advance and to consistently manage and exceed expectations. I have spent five years trying to build a turnkey, bulletproof system that serves my clients at the highest level with or without my presence. The goal is to McDonaldize your business. Consistency of service is often more important than wow service. For example, if you do a loan 98% right, but the loan closes one day late, you will be in trouble. Your homeless client will not be a raving fan of your company. Raving fans are the result of consistently exceeding expectations.
Today’s technology makes it much easier to wow customers. LP & DU underwriting create a sense of certainty up-front for the client. The automated approvals help prevent last minute surprises. Two-minute loan approvals help you deliver outstanding service. It is also important to work with a lender that is integrating technology to help improve back-end processes and systems. After talking with top originators around the country, I have found that Interfirst Wholesale is the best for streamlining closings. I have already personally closed 100 loans in the last year using the “Interfirst Fly” program, which makes 15-day refinance closings easy.
Technology can be used to automate many of the processes and reports involved with loan flow management. Most sales automation systems can print out dozens of status reports within a few minutes. I use technology to proactively manage my loans. We contact clients with loan updates before they ask for status. We use reports to track every aspect of the loan process to make sure that there aren’t any surprises. The days of running a successful mortgage company without a customer relationship management system are over. No longer is it acceptable service to keep all of the files in a processor’s file cabinet and rely on the processor’s memory or weekly pipeline meetings to keep on top of your files. Your loan flow system should allow for instant, real-time updates on any of your loan files in process.
Even more important than the technology itself is creating an operations procedure that makes your processing team accountable to the technology system. I can vividly remember three years ago when I first decided to send e-mail updates to my clients during the loan process and to also generate a special daily report for all loans in our system that were less than 10 days before closing, but still didn’t have documents prepared. I knew that these two systems would substantially improve customer service and allow my team to more proactively manage loans. My processing team fought me on implementation and gave me every possible excuse why the system couldn’t be developed. I had a very good processing team, but they were not committed to keeping up with the new technology. Rather than giving up on the new systems, I replaced my processing team. Far too many mortgage originators are held hostage by loan processors. Today, I have one of the best processing teams in the world. My processing team closed $20 million a month for three months in a row. Our e-mail systems and special pipeline report paid off big time by creating tremendous efficiencies during this refinance boom.
Exceeding your clients’ expectations should not be something that happens from time to time, or by accident. Exceeding expectations should be by design. Build your loan processing system so that it consistently and proactively delivers beyond anticipation and expectation. Clients shouldn’t have to call you during the loan process if you’re doing your job right. You should be anticipating their needs for information in advance. That’s great service. Most of your clients should just call twice; once to start the loan process and again when they thank you for a great loan experience and give you your first referral.
Ongoing Contact
The previous steps lay the foundation for a referral business, but it is the follow-up that will allow your referrals to grow exponentially. Once you have a vision of outstanding service and wow your customer with expert advice and then deliver excellent loan processing, you are now in a position to have your cake and eat it too. Unfortunately, way too many loan officers stop after the first three steps and never execute an ongoing plan. It can actually be frustrating for many originators. I often hear originators say that they give great service, but just don’t have a substantial referral business. Most originators don’t go the extra mile. All of the money and glory is in going the extra mile and creating raving fan clients.
A fundamental part of customer service is staying in touch with customers. From loan application until 30 days after closing, my referral marketing plan delivers 16 personal touches to my clients. These 16 personal touches consist of e-mails, letters, cards, gifts and special mailings. Although each referral marketing piece serves a different purpose, the theme remains the same. Here are some examples of phrases that I have pulled from the letters and e-mails that I send: “It’s my goal to make the loan process simple for you and the closing as stress-free as possible.” “Is there anything I can do to make the home closing easier for you?” “I look forward to both a smooth closing and a lasting relationship with you in all of your real estate needs.” “I appreciate you and value your referrals.” “Your closing is my top priority.” “Thanks for being one of my favorite clients.”
There are several strategies that I recommend implementing. First, try to make your notes as personalized as possible; handwritten notes are my favorite idea. However, it is a little difficult to send thousands of handwritten notes a year. I have created my own computerized handwritten font with Signature software. This creates a very individualized letter.
Design unique and personalized stationary with your photograph. For my referral marketing, I have created special letterhead that is only six by nine inches. At the top of the note, it reads, “A personal note from Steven Marshall, your personal mortgage planner.”
Develop thoughtful, wow gifts to send to your clients during the loan process. Within a day of receiving a signed purchase and sale agreement, my team mails our clients thank you cards to remind them that they are our most important priority and that we will take care of all the details. As soon as we receive final written approval, my team mails our clients a congratulations card to let them know that they are approved and that we look forward to a smooth closing. Included with the congratulations card are free Starbuck’s certificates and a Bellevue Mutual mug. About a week before closing, I send my clients a hand-written note letting them know that I want to make sure the last seven days of the loan process are smooth and hassle free. I include a Bellevue Mutual key-chain, a flyer that outlines the five steps to a successful escrow closing and a U. S. Postal Service change of address packet.
At closing, my team delivers a gourmet gift basket to our clients with a thank you note to let them know we appreciate their business, and hope to be of continued service to them, their friends, and family. About a month after closing, my team mails a live friendship tree for our clients to plant in their new yard. The card thanks our clients for being one of our most valued customers, and that we look forward to a long and lasting business relationship with them in all of their real estate financing needs. After closing, we launch an intensive client for life marketing plan that consists of dozens of wow services and mailings.
My most effective, high-impact, low cost strategy is my proactive, systemized e-mail campaign. As I mentioned earlier, I had to struggle to make this system a reality. Now that it works, I am able to deliver excellent service and not even be in the office. I developed e-mails for all of the high-impact points of contact; Introduction E-mail; Approval E-mail; Loan Docs Ordered E-mail, HUD-1 Reviewed E-mail and Closing E-mail. The e-mails look and feel like a personal contact to my clients. I integrate some of the phrases outlined above. And I also try to answer questions in advance of clients asking them. After personally closing 2,500 home loans, I started to realize that there is a pattern to the questions and concerns that clients have during the loan.
Last year, I enjoyed the opportunity to really experience the difference between a satisfied client and a raving fan client. In February, I helped a client purchase a $950K home with 20% down. I went the extra mile to make sure that they received special and thoughtful gifts during the loan process, in addition to making sure the loan went perfectly. Within 90 days of closing, this client referred me to new clients buying a $1.5 million home, $1.3 million home, $800K home, and $500K home. And this year, I have already refinanced several of these loans. I successfully closed over $6 million of loans in one year directly from one client. I am a successful originator because I build my business 99.9 percent by referrals from raving fan clients.
Developing an “extra mile” referral marketing plan, seems to be the barrier that keeps many good originators from becoming outstanding originators. The good originators work hard, treat their clients well, close on time, add value, but don’t always get the jackpot referrals. Build a service system for your business, one that consistently “wows” your customers.
By Steven Marshall