Dave: I can't evaluate or comment on the system since I don't have enough information, but I do have enough information about your business model to say that it is not a good idea. While I don't doubt that you may increase your business this way, there are two major issues you should consider:
- Top producers get their business from referrals and their referrals come from their sphere. Bringing in cold leads from across the country will not enable you to build referral relationships. Most of the opportunities you have are right under your nose and instead of looking thousands of miles away, open your eyes wider and see the opportunities which are around you. For example, your pipeline can provide plenty of opportunities for referrals if you work it in the right way.
- Secondly, cold leads are going to be of a lower quality than referrals. They are more likely to be those who are shopping rates harder or poorer credit/income quality. Those with a higher credit quality are more likely to have lender relationships to call upon rather than searching the net. Doubling your income does not make sense if you are doing ten times the work getting leads converted and deals closed. I would rather increase my income through high-quality referrals.
I mentioned that you can produce leads from your pipeline. I have covered this topic in previous columns, but feel that this is a good time for a refresher. Where do you start mining your pipeline for leads? At the very beginning because of the law of selective perception. Like when you purchase a new car and you notice the same make, model and color on the road – when you speak to a prospective homebuyer, their perception regarding homebuying is way high. They are speaking to others and asking questions such as: 'Do you like this neighborhood?' or 'What company did you use?'
Therefore, their ability to produce referrals is the highest earlier in the process. Most loan officers wait to ask for referrals (if they ask at all) until after closing when they know everything went well. We should be asking for referrals at the beginning because their perception is the highest at that point. Later they are asking about drapes and furniture.
Of course, it is not easy to ask when you are fighting for the deal. The key is value and timing---ask when you have delivered value, such as writing a preapproval letter at 10:00 PM on a weekend. When they thank you, say something like: “I love helping my clients get the home they want. Do you know anyone else I can help?” Many find this statement more comfortable versus “Do you have anyone to refer to me?”…
Dave Hershman is Senior VP of Sales of Weichert Financial and the top author in the mortgage industry. Dave has published seven books, as well as hundreds of articles and is the founder of the OriginationPro Marketing System and Mortgage School – the online choice for expert mortgage learning and marketing content. His site is www.OriginationPro.com and he can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..
