Maximizing Your Lead Conversion Rates

Whether you’re generating leads from a direct-mail campaign, or purchasing them from a lead generation company, the same general rule always applies: to get the highest conversion rates from your leads, you’ve got to be prepared.

You’ve likely invested considerable time, effort, and expense into the lead generation process.  By following a few critical steps, you can ensure that these efforts are not wasted, and that you obtain the highest return on investment possible.

Handling Your Incoming Leads
The first step in many lead generation programs will be getting your office ready for a surge of incoming calls.  Some lead generation services provide you with pre-qualified leads—customers that meet your loan qualifications, and have already defined their interest level in a certain program.  But if you’re not dealing with that sort of a program, or have developed your own lead generation campaign, you’ll need to set up a qualification process for your incoming leads.

The first thing to decide is who the best people are to handle your incoming calls,  and what they’re going to ask the consumers. This is going to vary based upon the type of leads you’re dealing with. Let’s assume you’ve placed an advertisement in your local newspaper.  In the case of this unqualified lead, it might be appropriate to have a secretary or junior staff member qualify consumers on the initial call. You’ll also need to develop a script for these team members to properly handle the customer’s call. Develop a loose script, or list specific questions that will allow these team members to determine a base interest level, qualify the consumer, and gather contact information for a more experienced loan officer to return the call.

You’ll want to take a very different approach, however, if you’re receiving leads that have been pre-qualified either from an inside telemarketing department, outbound telemarketing service, or a lead generation company.  These leads have already been partially qualified or “heated up” by the telemarketing service, and should probably be sent to a more senior team member who can provide specific product information. You must also adequately prepare your loan officers for this, or other, incoming leads—if they aren’t ready to properly handle these “hot” leads, they can easily flub the incoming call.  The best way to go about this is to hold regular strategy meetings with your loan officers to discuss what types of leads they’ll be receiving calls from during the upcoming the week, and the best ways to handle each lead source.

Another critical step that cannot be overlooked is setting up a 24-hour/7-day answering service to handle any calls that come in outside of normal business hours—you’d be amazed at how many people want to learn about refinancing at 10 a.m. on a Sunday morning. And if a consumer can’t reach a live person, and is directed to a voice-mail, the chances are high that they’ll simply to go one of your better-equipped competitors. An answering service is a worthwhile expense that will help increase your return on a lead campaign.

With any sort of incoming leads, the best idea is to sketch out a brief “workflow” diagram that traces a lead’s progression through your firm.  While this is a straightforward exercise, it will enable you to visualize who exactly will be handling the leads, and develop appropriate action steps for each step.

Getting Organized
If you’ve developed your own campaign—such as a direct mail piece or a radio advertisement—you’re going to need to keep accurate records of your incoming calls.  Be sure to develop a spreadsheet or note-taking system for whoever will be handling incoming traffic; the worst thing you can do is not get complete information from potential clients.  It’s probably easier to take this initial step before inputting any information into your CRM software of choice—this way you don’t clutter your computer with those leads that look unlikely to pan out. If you’re purchasing leads from a reputable supplier, your leads should ideally be delivered into some form of contact management system, eliminating the headache of dealing with the spreadsheet process.

In order to convert the largest number of leads, it’s also crucial to keep track of your leads diligently and take frequent notes. Organize your leads by their level of interest or status of any loan application to easily send effective follow-up communications based upon their status.

Needs-Based Selling

When it comes down to it, the easiest way to sell a loan is simply to understand your client’s needs, and then provide a solution to meet those needs.  Once your lead-based call has gone through an initial qualification, try implementing the following needs-based selling concepts instead of your usual sales pitches to drastically improve your conversion rates:

Keep It Conversational: Use your initial call to introduce yourself to the potential client, and feel out their reasons for getting in touch. Unless a lead expresses a real level of urgency, you shouldn’t press for the sale on this call—doing so will only turn your leads off, and cause them to look elsewhere for their loan

Ask The Right Questions: Avoid open-ended questions, such as “Why did you call about refinancing?” or “What are your needs?” Instead, ask the client specific questions about the type of house they want to purchase, their current mortgage payments, their current income, or if they’re looking to do home improvements.  Questions like these will help you truly get to know your client, enabling you to offer them a product that can best meet their needs.

Plan for The Future: An alternative to ending your initial call by going for a close, is simply trying to get your lead to the next stage in your relationship. If you’re handling the client strictly over the phone, tell them you’ll run some loan scenarios to find out specific information, and then call back to try and set up a time for an appraisal.  If you’re in more of an outside sales environment, try to set up a time to meet with the client to discuss their options.

Sell Your Service, Not Rates: The first question that many consumers will ask is “What’s the rate on that loan?” Unless you know for sure that you’re going to be the lowest in the marketplace, you don’t want to get into that battle. The best way to handle this type of question is with a “pivot” technique—one where you answer the consumer’s question, and then ask a question to shift the focus of the conversation.  An appropriate answer might be:

“The rate varies between five and seven percent, based upon a variety of factors.  When we get together, I can explain exactly how your rate might be determined, and what your payments will be.  Let me ask you something, are you thinking of doing any home improvements?”

In doing this, you’ve answered the consumer’s question, set-up the potential of a future meeting, and allowed yourself to shift the topic of conversation. Based upon the consumer’s answer to your “pivot”  question, you’ll be one step closer to providing the loan ideally suited to their needs, ensuring that you come across as a knowledgeable mortgage originator.

Following-Up With Your Leads
 So, now that you’ve organized your leads, made the initial contact, and sold to their needs, how can you maximize your return-on-investment by converting as many leads as possible? If you get a meeting with a prospect and they still “need to think about it” before committing, your follow-up will be the most important step toward capturing this customer.

Follow-up is the key to success with any lead generation program. The easiest way to follow-up with your leads is by taking the time to create a suite of re-usable communication pieces.  Remember when we talked earlier about lead status? It’s important to create a set of materials that deals with each particular type of lead, and begins to overcome any objections this lead may have. For example, you would send one type of letter or e-mail to those leads that you have simply held an initial conversation with, and a completely different type of correspondence to a lead that has already gone through the appraisal process.  A lead that has been “dead in the water” for three weeks would warrant a very different letter from one that is about to close on a loan.

You’ll need to develop several effective forms of communication for each stage in the loan conversion process. If your firm has the resources, you can also consider producing professional postcards or flyers that can be sent to your leads.  If not, it’s perfectly acceptable to use direct mailing and emails to stay in touch.  Whatever the medium, make sure that you’re regularly following up with all of your leads – even if they aren’t ready to close the loan. Potential clients will be impressed with your commitment, and will have you in mind when they are ready to move ahead.

There are some basic rules to keep in mind when crafting an effective follow-up letter:
· Remind the lead who you are, and the status of your interaction: “Thank you for calling me last week about your loan refinance. I’ve had the chance to come up with some great options for you.”
· Communicate the value of your services: “Please feel free to contact me for a free analysis of your situation and to see if we can start saving you money.”
· Explain how you/your firm is best suited to meet their needs: “At Company Z, we have access to over 1,000 different refinancing programs, so I’m confident that we can find the perfect one for you.”
· Create a time-sensitive response: “Rates are changing daily, so be sure to contact me as soon as possible to secure the best possible deal.”
While the telephone is also an effective way to follow-up with your clients, don’t overlook the potential response to a personal letter or email.  It conveys an old-fashioned, personal touch that your clients will appreciate.  When using the telephone to follow-up, be sure to follow the “needs-based selling” concept. It’s important to be aggressive in following-up with your leads – but you also have to take care to not be annoying or irritating.  It’s a fine line to walk.

Using Your ROI
The bottom line for any lead generation campaign is, of course, your return.  As your campaign progresses, be sure to keep a careful eye on any associated costs, and track the income that you bring in from closed loans. While a positive return is essential, the degree of your return is also critical.  Depending on your initial investment, the difference between a 20 and 30 percent return can easily be thousands of dollars. By running multiple types of lead generation campaigns and purchasing leads from different services, you can determine which sources are generating the highest returns.

You can also easily boost your return on investment through some careful marketing techniques.  It’s almost guaranteed that some of your leads will have relatives or friends who are also in need of home financing services. By using your existing leads as a referral base, for example, you have the potential to vastly improve your conversion percentages. When you a close a loan, send each customer a thank-you note and gift – and specifically ask them to refer anyone who could also be helped by your services.  Many people overlook this basic, common-sense step. By doing so, they’re giving up the potential for thousands of dollars in referral revenue.