When I say, “Mortgage Marketing,” what comes to mind?
Do you think of ways that you market to real estate agents to earn their referral business? Ways that you market direct to consumer so that you can source your own deals? Or some combination of both?
I started in the mortgage industry at a large bank, where real estate agents HATED most of us. However, we had prospects in the form of bank customers coming in and out of our workplace every day.
Eventually, I grew tired of the red tape and limitations when it came to my ability to service customers. This led me away from the large bank into what I considered to be “the real world” of mortgages. I began working for a retail mortgage company, which led to a variety of challenges and necessary paradigm shifts.
No longer was I accountable to being in a physical location, but more accountable than ever to get work done. I had a lot more leash, which meant a lot more responsibility when it came to managing my business and my clients’ expectations.
There was one paradigm that a lot of the loan officers around me, however, that I couldn’t quite get on board with. That is, that your client when you’re a Mortgage Loan Officer is the agent on the transaction and not the borrower.
Now different LOs take this concept to different levels, but most LOs are going to adopt this either in the way they market, the way they manage a transaction, or both.
Personally, my reluctance to make this shift mentally is what led to me developing the system that is now the backbone of Empower Funnels. I couldn’t get over the idea of bending over backwards for realtors, just so that I could bend over backwards for the borrower in hopes that I not only made the experience as good as possible for the client, but satisfied everything the agent needed as well.
In the process of developing this system, and now using the same system to help 50+ loan officers across the country make the shift from traditional mortgage marketing to consumer direct mortgage marketing, we’ve come across a few benefits that most clients that we onboard have no idea lie on the other side of their new lead generation system.
1. Consumer Direct Mortgage Marketing Leads to More Balance In Your Life, By Having Healthy Referral Relationships
This is a HUGE perk that is impossible to sell, but is extremely rewarding to witness our clients achieve.
In a traditional realtor-centric mortgage marketing business model, every loan officer has to go through a period of time where they sacrifice work-life balance or normal boundaries in order to get more business in the door.
Whether it’s missing family time for an Open House on a Saturday, or missing dinner with the family a couple nights in a row because you’re sending out pre-quals for specific properties, sometimes 5 or more for one buyer.
The fact is, a one way relationship where agents send you business and you do anything you can to keep getting that business is unhealthy.
In a “healthy” referral relationship, the value you bring to the table is no longer based on you providing the best service possible to your agent. No, instead, because you also bring deals to the table, you can choose your relationships more strategically.
You get to work with the agent that is proactive and asks for a few prequalifications ahead of time, or better yet, is fine with sending a prequal for slightly more than asking because they are capable of negotiating with more than “they can’t afford more.”
You can to choose to work with the agent that doesn’t work open houses, or doesn’t need you to as part of your relationship.
Lastly, you get to work with the agent that does enough business, that they don’t need to elevate the blood pressure of everyone around them if they don’t get their commission in 19 days instead of 22.
Think about your agent relationships. Now think about how many of them you’d continue to stick with if you had the choice to receive just as much business from someone who didn’t make you want to pull your hair out.
Now imagine how much better your life could be if you were in that position.
2. You Get to Do What’s Right for the Borrower, Every Time
So many pressures that make a transaction stressful, will stem from improper expectations either from the lender or the real estate agent.
Picture the scenario:
A client comes to you through a realtor, and wants to buy a particular house.
The client doesn’t qualify for that house, it’s about $15,000 more than they can qualify for DTI-wise and realistically is more out of their monthly budget range than that.
However, that client came to you from a realtor, inquiring about a specific property. Who are you to tell them they shouldn’t be buying that house right?
So you begin to look at every way possible to get them approved for that specific house. You talk about getting gift money to payoff debt, looking for a co-signer, negotiating a raise at work, all just so they can get in a specific house that they fell in love with because their agent didn’t set proper expectations.
Now imagine the same scenario without an agent involved.
You get an internet lead that’s interested in a house they see online, and you convince them that the best way to see if that house is realistic for them is to complete a full 1003. They don’t qualify, and to be honest it’s more than they can afford even if they could.
So you have a real conversation about why although buying is better than renting, buying outside your budget can be one of the biggest mistakes you can make. You reset expectations by letting them know their target price range should be about 25k-50k lower. Although they may be initially bummed about not qualifying for the house they were looking at, you put them in touch with one of your trusted agent partners that know that your prequalification amounts aren’t flexible, and they sell the clients a house that is within their means.
This is an obvious scenario, but there are many other less obvious situations where our relationship with an agent can be in conflict with what you feel the best thing to do for the customer is. If your entire business revolves around realtor referrals, what are you going to do in that situation?
3. Earn More Referral Business Than Ever
The obvious benefit here is that you’ll earn more referral business from your realtors if you have deals to refer back to them.
Believe it or not, these aren’t the kind of referrals that I’m talking about though.
We’ve consistently received one piece of feedback since beginning to offer consumer direct mortgage marketing for loan officers. Self sourced clients are more loyal, leave better reviews, and ultimately refer more business back to the loan officer they worked with.
Consider the logic for a minute.
When you get a client referral from a real estate agent, is that client really yours or is it the agent’s?
When that client thinks of real estate transactions, are they going to think of you or the person that referred them to you?
In most cases, the referrals, the reviews, and the long term relationship with a client referred to you by a real estate agent will be centered around that agent.
We’ve received multiple testimonials of clients who received referrals that converted from prospects that they hadn’t even done a loan for!
Can you remember the last time you received a realtor referral, told them they can’t buy a house, and then received a referral a month later from that lead (not the agent)?
When you run consumer direct mortgage marketing, you become the quarterback of your transaction. And when you’re the quarterback, the play always starts out with the ball being put in your hands.
Consumer direct mortgage marketing is the only way to protect your business against inevitable changes ahead.
I’m not Chicken Little, and I’m not here to tell you that the sky is falling. What I can tell you, is that the mortgage business has changed A TON in the last 20 years. I can also say pretty definitively, that the change will continue just as rapidly.
What doesn’t change?
We have a saying here at Empower Funnels: “If you control the leads, you control everything.”
That’s never going to change. The mortgage business has plenty of turbulence ahead, but you can make the most of it. If you have a big enough database of past clients and prospective clients that you’re marketing to, not only will you weather it just fine, you’ll reap all of the rewards that go along with a consumer direct mortgage business.
As always, thanks for reading, and I’ll see you at the top!