Setting Measurable Pull-Through Rates

Coaching has to be a passion. You can’t possibly help bring out the best in the people you work with if you are not passionate about helping people find results. I have spent the better part of the last fifteen years working with and coaching some of the best originators in the industry. I have also had the great fortune to know and learn from those in the mortgage industry, as well as some of the best sales and service minds of our lifetime. When you combine that with what I have read in biographies of some of the great leaders of the world, in sports, business, and military, you get to formulate the process by which you hope to help the people you work with reach their goals and beyond.

Most of the answers can be found in simplicity. Every time you think you have broken a process down as far as you can go, go back and break it down again! The path to success is not paved by making things easy; it is built upon simplicity and fundamentals that are simple to explain and duplicate. Nothing about the mortgage business is easy. However, it can be made incredibly simple. In the weeks and months to come, I am going to put forward some of the very steps I use with each one of my private clients to quickly understand what part of their business needs the most attention, and how we take a few simple steps to see immediate results. I have found that if you can quickly make a few simple changes that generate specific measurable results, people will be more open to future change, and maybe even embrace the changes they need to make to move forward. So here is the first step.

Simple measurable items to track your pull-through rates:

Each and every one of us does some form of prospecting. Whatever that is, it is the first step in the process that goes from contact to closing. In this piece we are not going to worry about how you generate that initial contact, we are going to focus on the math from contact to closing so you can have something to compare your number to. We have talked in the past about the various stages of the business:

• Suspect
• Prospect
• Applicant
• Closed Client

In the purchase-focused arena, we must modify our outlook and tracking to put specific numbers and conversion rates on the steps from contact to closing that look like this:

• Conversation to Credit Review
• Credit Review to Pre-approval
• Pre-approval to Formal Submission
• Formal Submission to Closed Loan

I use this like a baseball diamond, first base, second base, third base, and home. You have to hit all the bases to score a run! Just like in baseball, there are different statistics you can use to track these numbers, and some “players” have different levels of success. Here are the measurable I like to use, not because they are perfect, but because they show you clearly what part of your business needs immediate attention and will likely give you the biggest “return” for time spent working in that area. I call this the 80-80-80-95 rule.

80% of the people you have a mortgage conversation about should allow you to pull credit and have a credit score high enough to credit qualify for a loan.

80% of those people should supply you with enough documentation so you can pre-approve them for a loan.

80% of your pre-approvals should find a property and go into formal application.

95% of all formal applications should close.

If you follow the math, that means your prospecting and follow through should convert slightly less than 50% (48.64%) of the people that call you into closed clients. This is a starting point. I have some clients that are higher, and many that are lower. But the goal here is to track your numbers so you can see where you need to focus your efforts. It’s not always the case that you need more “leads”. You might be getting plenty of leads that either just are not credit worthy, or you are not doing a good enough job moving through the system, or just staying in touch with.

If less than 80% of the people you are talking to don’t have high enough credit scores to qualify, stop and see why! The national average credit score is above 700 and about 80% of the general population has credit score above 650. So watch where you are looking to see if you can improve.

If less than 80% of those who are credit qualified will not give you documentation so you can accurately pre-approve them, you need to look at how you are handling that process, and see what you can do to improve that number.

If less than 80% of your pre-approvals are not finding a property and submitting a formal application with contract, you need to look at how you are following up with them to be sure they are seeing property and reminding them that you are there to help them through the process.

If less than 95% of your formal applications are not closing, you really need to look at your systems and see why!

These are four simple steps with four simple items to measure to see how you are doing. Many people don’t know to track these items; others spend too much time looking for perfection instead of being sure that all of their numbers fall within an acceptable range. We can all pretty much agree that an almost 50% conversation to closing ratio would be a great start!

Questions or comments please contact me at: Mike@IMTcoaching.com or visit my website at hhtp://improvemytomorrowcoaching.com

Connecting with Coupons

Everybody loves a discount. We all like to think we got a good deal on something or did not have to pay bust out retail for everything we own. Let’s face it, millions of people watch that TV show where they buy all the groceries, fill up a half dozen shopping carts, spend three hours in the store, all the time spending only $20 in cash after coupons. Coupons allow us to feel we received good value for the money we spent. Coupons have long been used to promote products, services, and the thought that we were gaining a good deal, or getting a better value.

Now, not everyone is a big fan of clipping coupons. Some people would be embarrassed to use a coupon. But a great many people have no issues using a gift card or a gift certificate. So why not look at these items as possible links to new business? Can we combine these items to promote opportunity by sharing exceptional value? Of course we can, and here are a few ideas on how we can do it.

Many of us already use the closing cost discount or the certificate for a “free” appraisal to attract new clients or to entice our Realtor® partners to share this discount with their clients. But what if we raised the bar on that just a little? What if we went to our local product and service providers and put together discounts or free products and services by local providers? Many have used this “coupon book” approach instead of providing a closing gift because there is specific targeted value in the goods and services being offered. The client gets to choose some or all of the options to receive value from and might very well find providers they will use for a long time into the future.

What if we took this a step further and use video couponing to get our message across? What if we had a series of thirty second to three minute videos explaining the product or service being offered, as well as the value of the offer being made? Not only can we just email these to people, we can text them or post them to social media outlets so we can increase the exposure of the offer! Imagine a series of video coupons on your own YouTube® channel? What if you had a “video catalog” available of product and service providers? What if you collected email addresses of people who wanted these offers? What if you shared these to your database and social media outlets? How much extra visibility would that get you? How quickly could you grow your database with people who wanted to hear from you?

The same holds true for our referral partners. How do we share value to them for their clients? Do we offer an “Annual Mortgage Fitness Check-up & Identity Theft Screening” for our accountants, financial planners, insurance professionals, and attorneys? If not, why not? Don’t they have an interest in having their clients pay as little as possible for what they buy or finance? Of course they do. But they don’t know that they have this option, or even if such a thing exists unless you share with them why and how it is of benefit to them to do it. More importantly, why it is important to their clients to take advantage of this offer!

In an interesting twist to this whole idea, what about offering your Realtor® a coupon or a gift certificate for a free listing? How interested would they be in talking with you about that? What if you committed to helping them acquire this listing buy working with them using any or all of the strategies we have discussed in the past like;

• Help us pick your new neighbor.
• Neighbor’s only open house.
• Forever Home Strategy.
• First time Home Seller’s Strategy.

What if you made the commitment to work with them until one of these strategies generated at least one new listing for them? What would it look like if you made it happen? How would your business grow if you could make it happen?

Coupons, gift certificates, gift cards, coupon books, and video coupons can all help you differentiate yourself to new clients, old clients, new referral partners, and long-time referral partners. It’s about providing exceptional value.

Questions or comments please email us at: mike@IMTcoaching.com
or visit us online at http://improvemytomorrowcoaching.com

Knowing The Odds

I want to take a quick moment and thank my wife MJ, the staff at Fairway Mortgage Scottsdale North Branch, Nino Pascale, and fellow presenters Terri Murphy, Ski Swaitkowski, Dave Savage, and Tom Ward for their efforts in getting the first of the “Mortgage Success Made Simple” tour event as successful as it could be! We had 58 originators and managers from 26 different companies all attend and I could not be more pleased with the effort and results.

Every year my wife and I spend Valentine’s Day week in Las Vegas where we were married. We enjoy this city and all there is to do, but it also is a reminder of where we have been and the infinite possibilities of what the future may bring. A big part of enjoying Las Vegas is knowing the odds of each game you play because they all are not the same. Clearly this city was not built on the majority of people winning money. While some do win, the majority lose money, but in a way that creates a certain value to the experience.

In many ways the mortgage industry is very similar. For each transaction that closes, there are many originators that did not get that deal, or were “losers”. Some lost because they did not ever get a chance to compete while others lost because they did not make a solid presentation or follow up well enough to keep the client’s attention. Either way, they did not get the deal. The good news is, just like in baseball, we don’t need to get a hit every time we come to bat. In fact, our “batting average” can very well help us determine how effective we are and if we are focused on doing the best things possible with the time we use working.

Imagine if we all kept score? Imagine if we really knew what our batting average was in each area of prospecting and even knew our score by each referral partner? The real question is why don’t we? How come we are not crystal clear about where our business comes from and how many referrals we get from each source and what the frequency is or which activities generate the most closed loans for the time invested? Would not that be of significant value? Could not we all benefit in knowing these numbers and making choices to either improve them or to accept them?

We need to do a better job getting focused and knowing the odds on what efforts and activities generate the referral partners that refer us, as well as the quality and closure rate of those referrals. Imagine if we just kept score? Think about what happens when you know the odds? We all know roulette has terrible odds of winning money over time, yet there are always people at the tables playing. In Vegas, the best rate of return is found at the crap tables but some people find the game too fast and confusing. Does anyone ever win the jackpot in Keno that is not named “Griswald” in a movie? Maybe so, but most of the time it is a losing bet that people are happy to make because of either the potential return of winning, or the time occupied “hoping” they will win.

Hope is NOT a strategy for success! Planning and executing a plan is. We all need to do a better job tracking our efforts and documenting the results of each activity. How much time does something take to do? What are the costs? How many new people do I speak with as a result from doing this? How many credit reports do I pull and what is the percentage of credit approvable scores? We also have to track the number of people we can approve, but also need to know how many actually close a loan!

You can improve your chances of winning, or at least know the risks of losing in each area you work in the industry. The goal is to close loans and generate happy clients and referral partners that keep us working. The efforts and areas you work to do that are up to you. Everyone has a different idea of what is successful. Just make sure you are clear on what success is, and be certain you know your odds of winning in each area you focus on to generate opportunities!

Questions or comments please email us: Mike@IMTcoaching.com or visit us at http://improvemytomorrowcoaching.com

The “TOUR” Begins

Friday, February 7, 2014 in Scottsdale Arizona will be the first stop in the “Mortgage Success Made Simple Tour”. I will be happy to share the time with Terri Murphy, Dave Savage, Tom Ward, and Ski Swiatkowski. I have asked Nino Pascale of Fairway Mortgage in North Scottsdale help with getting the message out and coordination of events at the Orange Tree Golf Resort. This will be the first of what could be as many as ten stops across the country sharing information and strategies to help loan originators make the transition from refinance to purchase based business, and to help move loan origination from sales experience to one of the highest professional standards. We all need to move from salesperson to expert if we are going to thrive instead of survive.

Each of my guests will have paid their own way to the event, and has donated the time and information so we have the ability to share information that matters to all of us. Our industry has to do a better job acquiring new opportunities, generating value to our customers and referral partners, and maintaining contact so we can maximize all of the opportunities we are presented.

As a member of the mortgage community for more than 30 years, and coaching and training some of the best in our industry for more than the last twelve, I have put together a powerful three hour presentation that allows for each presenter to share their insight, explain their strategy, propose solutions, and help make life simple for all originators and managers. Notice I didn’t use the word “easy”. There is nothing easy about our business. However, we can make success simple if we just know the strategies and systems that help us maximize our abilities to generate and convert opportunity while supplying value to those we serve.

If you would be interested in have this tour stop in or near your city, please let us know as we are working to finalize the schedule shortly.

Simplicity means taking the clutter out of things and defining a smooth even process. Often times we make things complicated for no reason. More times than not we don’t even understand ourselves what a “perfect” transaction would look like. So that is what we can do today to improve our tomorrow. Why don’t we all take a few minutes and commit to paper what a perfect transaction would look like, from the time the prospect first calls, right up to and including the closing of the loan and any follow-up that takes place. Seriously, what would it look like? Once you have it down, take each task and assign it to a timeline. Remember, having a great written plan doesn’t do you any good if you don’t schedule the time to actually do the work!

Now that you have the plan and the schedule, all that remains is that you set the proper expectations for everyone involved; clients, referral partners, your support team, everyone that is part of the process needs to know how they fit into the puzzle and be committed to the same perfect process! I know this sounds challenging, and it may be at first. But the rewards of committing to a plan, setting a proper timeline to the work, and creating the proper expectations for everyone will have you doing more loans in less time while building a network of referral partners that know you are the expert they want on their side of the deal!

The mortgage business isn’t easy. The time has come to acknowledge that being ordinary is no longer viable. We need to do the work and transition from salesperson to expert, and that process begins when you decide that making things function as simply as possible is the first stage in developing expertise.

The Mortgage Success Made Simple Tour will be at:

The Orange Tree Golf Resort
10601 North 56th Street
Scottsdale, Arizona 85254

Friday, February 7th 2014. Coffee at 8:30am, we will start at 9am SHARP!

For more information please visit http://www.improvemytomorrowcoaching.com