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Pat Sherlock[/caption]
Likewise, refinance applications dropped. Freddie Mac also reported that the percentage of borrowers with rates above 5% has declined. All of these trends indicate a shift to purchase money, which means 2021 will undoubtedly be more challenging for lenders and originators than last year.
None of this should be a surprise for experienced mortgage bankers familiar with the ups and downs of origination. But, for newer LOs who have focused their sales efforts on refinance lending, the switch to purchase money can seem especially daunting.
Many originators are currently faced with attempting to rekindle relationships with referral sources they may have ignored, a nearly impossible task. Any producer who believes that a low price is enough to win back a real estate agent who they have not spoken to in months is living in a fantasy world.
It may not seem fair that a previous referral source has moved on to other contacts for home loans, but that’s the reality. With more than 500,000 originators nationwide to choose from, referral sources have endless options to do business with sales professionals who are attentive to their needs.
So, how can originators increase their purchase money market share? Here are three strategies that work:
- Select a niche. Originators who think that every person is a potential customer is missing out on the benefits of being known as an expert in a particular area. Selecting a niche enables producers to differentiate themselves in the marketplace and better target their sales efforts to potential referral sources.
- Create value for referral sources. What is valuable to one referral source may not be valuable to another. For that reason, originators must learn what a particular referral source values before they can establish a meaningful relationship. Once this piece of the puzzle falls into place, originators can deliver value to a referral source and build a long-term partnership.
- Be consistent in marketing. To attract the attention of referral sources, originators must reach out consistently and frequently with valuable content. Messaging should be presented in a format that matches with how referral sources want to receive information. Mass marketing emails and newsletters are no longer effective at setting an originator apart from the competition.
Right now is the perfect time for lenders and originators to polish their purchase money strategies. Originators who take these three simple steps will have referral sources knocking down their doors.
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.
