To compound these issues, Zillow recently noted that almost 50% of sellers are receiving contracts for purchase within seven days. At the same time last year, this figure was only 30%. And finally, analysts are predicting that volume will slow to a crawl in the second half of the year.
With such a myriad of factors to consider, what should originators do to successfully navigate marketplace conditions? In my opinion, there are three strategies originators can implement to ensure greater stability in the short- and long-term:
- Increase prospecting for referral sources. Amid the historic 2020 refinance boom, many originators pushed prospecting aside in order to close their refi pipeline. As a result, referral sources may have moved on to work with other sales professionals. This means originators will be under the gun to revive old referral sources or add new ones quickly so they can generate enough business to survive a downturn in the market. Consistent prospecting to referral sources will be mandatory for success in a purchase money environment. If originators are not reaching out to potential referral sources, you can be sure that your competitors are!
- Keep in touch with your current customer base. An originator’s previous customers are a potential gold mine that must be tapped. Too often, originators fail to maintain meaningful relationships with former customers. Because they are already familiar with an originator’s level of service and value proposition, previous customers should be a priority because they are an important gateway to future referral business to their family and friends. To engage with former customers and position themselves as local real estate experts, producers should deliver content that is specific and valuable to their customer base. (Sending recipes is not the answer!) There are an infinite number of ways originators can keep in touch with customers and add value to those relationships. Salespeople can conduct surveys to find out what their customers are interested in, host webinars and invite customers to attend, and feature experts on the webinar to share important information on local trends such as current tax laws and recess property legal issues. Podcasts are another effective way to stay top of mind among your target audience.
- Improving your core competencies. When refi volume is robust and borrowers are reaching out in record numbers, origination seems easy. But, the opposite is true when a purchase money market dominates. As every experienced originator knows, mortgage banking is characterized by boom or bust cycles and the best hedge against changing conditions is to commit to one’s personal development. Top producers understand this and are continually improving their selling techniques and tweaking their sales models so they can deliver an exceptional customer experience with every transaction. Learning new sales strategies requires an investment of time and money but the payoff—new customers and referral sources—is worth the effort!
Are you ready to commit to winning today’s dog fight in mortgage lending?
Pat Sherlock is the founder of QFS Sales Solutions, an organization that helps organizations improve their sales talent management and performance. For more information, visit https://patsherlock.com.