“Taking What You Get or Getting What You Need?”

We have been talking a great deal this time of year about business planning and setting the proper expectations for 2016. So many of my clients do such a great job, it is often difficult to get them to expand their thought process and reach deeper into a better personal outcome. While speaking to a group of originators in Houston this past week we came across the challenge of leaving behind the things we have based our business on in order to move to a higher level of quality. It’s uncomfortable to leave behind what we know in search of what we really want. What we have is often frustrating and short of what we truly want, but it’s all we can do working the way we work, doing the things we do.

Change isn’t such an easy thing to deal with. Given the whole TRID situation we are often forced to deal with outside requirements that force change, even if we aren’t happy about it. So if we have all had to deal with TRID because that was the new requirement; why isn’t it just as simple to make the very structural changes to our business that we need to make so that we are getting what we want and need, not just accepting what we are getting? As my good friend Steve Probst would say, “In order to make any significant change to your current situation, the first thing that must change is your mind!” I have valued that statement a great deal and as a coach, it is likely more true in my business than most other situations. We have to change our mindset in order to change our outcomes!

So during this business planning season, and it IS business planning season, you must first take a good hard look at where you are and how you got here. Is what you are doing worth the outcome you are getting? If so, keep working that plan and see if you can reduce the time it takes so you can either work in more opportunities, or take more time off! If things are NOT going as you had wanted, look at what you are getting, where it’s coming from, and make the following determinations:

  • Can I get more from those who are giving to me?
  • Can I find more people like those who are currently referring me?
  • Is what I am getting, worth the time and money invested?
  • If the answer is “YES”, then proceed and grow. If the answer is “NO” then something has got to go!

You can’t keep following the same failing pattern in hope that things will get better. They won’t likely get better by themselves. You are going have to make some changes.

Those changes can be anything from improving your prospecting to improving your pull through rate. The changes can be in your system of how the client goes from contact to closing and paying attention to the question: “Have I done all I could to replace this file with another file, or have I gained a referral partner who will now refer me as a result of this experience?” Have I looked at each activity and referral partner and calculated if they are a part of the team I bring with me into 2016, or do I need to cut them loose in order to focus on people or activities that generate a better result? Sometimes the best addition to your life can be made by subtracting something that isn’t working as well as it should!

Change is never an easy thing to deal with. Fear of the unknown can be a very powerful thing. But the pain of living with unacceptable results and not doing anything about it is capitulation! You never have to accept poor results. You never should be satisfied with not living up to your own expectations. I am often accused of asking more of my clients than they are prepared to give. That may very well be true. But I have never asked of my clients anything that they aren’t capable of doing!

So as you plan for 2016, ask yourself this question: “Am I prepared to live 2016 the same way as I did in 2015, or do I expect more of myself?” If you fall into the camp of wanting more of yourself, then what about you and your actions are you prepared to change in order for 2016 to be different?

Will I keep accepting what it is I am being given; or am I going to go out and do what it takes to get what I need?” It’s your choice.

Questions or comments: Mike@IMTcoaching.com

Planning the last 60 days of 2015

Now is a good time to take a look at where you are and how things stand. It is likely that you only have another thirty days to meet someone and get a deal together that will close in 2015. So look at your numbers.

  • How many transactions have I closed year to date?
  • How many deals are in processing and will close by the end of the year?
  • What is my total number of pre-approvals out shopping for a home right now?
  • Who will I meet that can put together a deal that will close in 2015?

If you total all of these numbers up, you will have your likely total closed loan production for 2015. Take a few minutes and do this exercise, I believe it will be beneficial.

If you are not happy with what that number looks like, you have a very limited window to do something about it. You need to plan out the next few weeks and be sure to push hard to the end of the year. Here are a few things you might really want to consider doing,

  • Plan a special event like the “Black Friday Sale” or “Movie Night” to get engaged with your referral partners and your database.
  • Sort through your database for any loans over 4.5% or in an old FHA program, or maybe even an adjustable to refinance.
  • First Time Home Seller and Forever Home Strategy is a great plan for this time of year.
  • In the colder climates, working the local neighborhoods asking if they are really prepared to live in the house they are living in for the coming winter?
  • Working closely with your HVAC professional to do furnace tune-ups and change filters.
  • Are you prepared for a “Fall Back” time to change your smoke detector batteries?
  • Halloween TRID or TREAT candy bags?
  • Holiday Party, 2016 calendars, event schedule for the holiday season.
  • Scheduling meeting with your accountants and financial planners to offer the Annual Mortgage Fitness Check-up and Identity Theft Screening for all of their clients?
  • Has everyone you know “Liked” your professional Facebook® page?
  • Are your promoting properties, events, and information there?
  • Video coupons and testimonials being shared through social media?

All of these should be part of your schedule for the end of the year. Don’t believe what others will tell you about “Business slows down in the fourth quarter”. That is pure nonsense. If business slows down in the fourth quarter it’s because PEOPLE slow down their actions and activities in the fourth quarter! You need to be out and engaged. You have to be talking about transactions with people! You have to be sharing solutions to the issues in your local market. You have to be working through the end of the year to capture every last opportunity of 2015 and to have a healthy pipeline moving into 2016.

You know the old saying; “Those that fail to plan, plan to fail!” What is your plan for the balance of the year? Are you proactively working toward a solid finish and a strong start of 2016? It’s 100% within your control! YOU make it or you don’t. YOU put in the work or accept whatever outcome you get! What is your choice?

Questions or comments: Mike@IMTcoaching.com or visit us online at http://www.imtcoaching.com

“The GUESS before the MESS!”

We are all watching intently as the first TRID compliant LE documents come off the presses and while slow, many seem to be quite comfortable with the new form and will in no time forget all about the old GFEs and TILs we used to deliver. So in my opinion, we are off to a great midpoint. Midpoint; what do you mean by “midpoint”? Well, by the time you issue the LE you are really at the midpoint of the process, the entire process from first call to closing. So with no surprise, the new LE will likely do its job and make the loan more understandable to the consumer, but there is still a few aspects of TRID that will cause far more harm than good. This week we look at what I think was the worst part of the entire rule, the part where you can’t require documentation before disclosing costs.

Now I understand that those in the government, who are really trying to help the consumer, really blew it with this provision. You can’t possibly disclose real time numbers without knowing the real facts of the transaction. If ANYONE in the process would have spent a few minutes actually talking with people who work in the mortgage industry, those at the CFPB would have discovered that IF you REQUIRED people to check Income, Assets, Property, and Credit BEFORE sharing ANY information, the consumer would have a real understanding of what THEIR true costs would be.

You see if you are actually in the mortgage industry you would know that there are multiple factors involved in a consumer’s actual costs in purchasing and financing real property. It’s ironic that the very laws that govern lending actually make this true. The same exact property can have completely different costs to finance depending on a whole number of items, including loan chosen, down payment, credit history, and any number of other factors. So how in the world does the consumer benefit from the fact that a lender can’t REQUIRE this information before providing costs? I know the thinking was that it was too much work for the consumer to give all of this information to multiple sources to check the real numbers. So the government just made it so we can’t require documents to provide information.

The result will become two fold. Many lenders will now prepare generic transaction information about a single fictitious loan scenario, so when a customer elects NOT to provide the necessary documentation to provide the real numbers, all they will get is a wordy pre-qualification letter that basically says “The customer has provided no proof or documentation to justify any of the claims they have made. Based on nothing other than the customer’s word, they may or may not qualify for a loan. If what the customer states are true, documentable, and conforming to all qualifying guidelines, they could qualify for a mortgage loan. Before accepting any offer, or committing legally to a financial transaction, it is advisable for all potential borrowers to obtain a full document pre-approval by a licensed mortgage professional.

You see; this generic set of figures, what I call the “Guess before the Mess!” Is just that; a guess! Many people are going to act on these numbers only to find that their specific transaction costs will be completely different. In fact, some poor people will get involved in actual transactions, only to find out that there is no possibility for these people to obtain any type of financing, let alone anything near the prices quoted.

Now I understand that it is a great deal of work to assemble this paperwork. Yes, it is work. But if the law required this documentation be reviewed BEFORE any numbers were given, then the potential borrower could really compare from lender to lender. And that part about it being too much work to put together all the paperwork? Well, they are going to have to put all that paperwork together to get a loan, so why not do it up front? As far as having to supply it to a number of different lenders to get prices? Well, the CFPB could have made it a requirement that the first lender scan all the information into their system and provided either an electronic folder or place the information on a zip drive for the customer and they could have sent the file to anyone who they wanted a quote from.

Not making the consumer get their paperwork in order before shopping is just plain silly. Why is it a consumer going out to buy a pair of shoes knows their budget, the type of shoes, where to look for it, and that they have enough cash or room on their credit card with them BEFORE they go to the store? So why is it that the CFPB thinks it requires LESS preparation to go shopping for a home than buying a pair of shoes?

The guess before the mess! Don’t get caught up in it. Yes, you must have numbers to share if a consumer asks for them. NO, you don’t have to invest more time into that customer than they are willing to invest in themselves! Share with them a winning strategy. Know before you owe should have been, Prepare before you dare!

Questions or comments: Mike@IMTcoaching.com or visit us online at http://imtcoaching.com

Last Push of the Year!

It’s hard to believe we are already in October. We are about forty-five days away from putting together the last deals of the year that will close and get you paid in 2015! Are you on track to meet all of your projections for this year? What is still left to be done?

You have just about a week to get in front of all of your accountants who are scrambling to put together those last tax returns for those that filed extensions. It’s an important time to remind them to ask their clients if they are planning to purchase a home in the next couple of years as now represents an opportunity to look at those returns and know that the returns they file now, and those they can file in February 2016 for 2015 income, represent two years’ worth of qualifying income! Paying your taxes never was more advantageous if you are looking to maximize your qualifying income for that next purchase. This can be a significant conversation with your accountants to show you are all about expertise and solutions, not just an order taker and paper pusher!

October also is the month we begin to focus on fall strategies. Are you planning a Halloween event? Is it possible for you to put together all the pieces for a “Black Friday Sale”, maybe a movie night or client event of some kind? It is also time to seriously put together your business plan for 2016 and get it done, scheduled and implemented by doing what it takes to really do what you know you should be doing. We will talk more about business planning with the monthly coaching call the end of the month.

We are not even a week into TRID and the stories are coming in about all of the misinformation on the street. Realtors® saying that the new “law” requires a 60 day contract; that the new “law” requires a seven day waiting period before closing; even that the new “law” eliminates the ability of a borrower to get pre-approved for a loan. It is just amazing to me the stories we are getting back from the street. If you have a wild and crazy TRID story, please let us know; we all need to get correct information out to the people; we know. The very people TRID was supposed to help clarify the process for?

Interesting opportunity and idea comes from one of my clients, Yvonne Godina in San Antonio Texas. She was thinking about how to incorporate some fun into all of this TRID conversation. Yvonne wanted to get information to the street and be a resource for accurate and timely information, but how could she do this in a fun way? Yvonne came up with a great idea. She calls it “TRID or Treat”. Using the Halloween time of year and a little bit of ingenuity, Yvonne came up with the idea to make a play of “Trick or Treat” by creating “TRID or Treat” holiday bags. They contain some candy, and a short letter sharing a few simple points about TRID and how to connect with her via phone, email, website, or social media to get more information about the truth when it comes to TRID.

When she first started sharing, her realtors® were amused, but then began really asking serious questions. A few agents shared the information with their managers and she has received requests to come back to the office and do an office wide presentation. Most importantly, Yvonne has received referrals from agents she has never received referrals from before as a result of just getting out into the market, sharing accurate information, and having a little fun with a confusing subject.

Great job Yvonne, I am sure this is just the beginning of a whole new stream of business from people who would have never referred you until you took a chance and got out and got engaged with sharing solutions to complicated challenges! It makes me very proud to have an opportunity to work with such great people on a daily basis.

Questions or comments: Mike@IMTcoaching.com or visit us online at http://imtcoaching.com

Full Document Pre-approvals

With TRID just a couple of days away from being our reality, the one most critical piece of the puzzle will remain in the control of the originator, the power of the pre-approval. While many will argue semantics, we need to be specific. We need a letter that everyone can see that describes clearly what it is, how it was prepared, and most importantly; creates a clear expectation for all parties to consummate a transaction within a specific time frame. Since turn-around times vary a great deal from market to market and company to company, you will have to be clear on your timelines and setting proper expectations.

The full document pre-approval should make it very clear that the originator has already received, reviewed, and calculated all the numbers from all necessary documentation. We are talking about a minimum of:

  • W-2s
  • Pay stubs
  • Bank Statements (Verifying all needed assets to close)
  • Tax Returns
  • Tri-merge credit report

Before issuing the pre-approval it is critical that the originator do the work and run all the numbers. If anything raises a question or a concern, you must get supporting documentation before issuing the letter. Once you have issued the letter, the borrower isn’t under any pressure to get the trailing documents. You have to share the value of your letter. Realtors® in your market will quickly know that your letters mean a timely and hassle free transaction! I already have clients that get their offers accepted over other offers, even higher dollar offers because the listing agent recognizes that this letter comes from a respected source and a proven professional. That is the power of getting it right by setting the proper expectations at the very beginning of the process.

With TRID upon us the full document pre-approval can also outline other responsible parties and their obligations to the transaction. An example being that you could include language to say that you will close within a specific number of days from certain other milestones like:

  • 28 days from receipt of a fully executed contract and permission to order appraisal.
  • We will close five business days from receipt of the clear to close from underwriting and final title numbers from the title company.

Just by adding this dimension to your pre-approvals helps set the stage. You can’t make an offer on the first of the month, negotiate the deal for a week, take another ten days to get an inspection done, and expect that you can close on the 30th of that same month. It just won’t happen. So do what I have done my entire career, back out the numbers and create the timeline.

Clear to close has to happen and the loan needs to be locked no less than five business days prior to the closing date. Final title numbers need to be supplied to the closer as well. If you back this up, you will find that the issue with closing in thirty days isn’t at the end of the loan, it is at the Beginning! A full document pre-approval sets the stage for the customer as well as all the supporting parties. When you are specific in your requirements to close in your letter, it puts everyone on notice that you have a specific timeline that everyone needs to follow IF they want to close in thirty days.

So work with your professionals in advance. Use the pre-approval letter to put people on notice. When you get a contract back, review the timeline with the buyer and both realtors®! Use the power of the timeline to keep everyone on schedule. The minute you are even just one day late you need to make calls and notify everyone that the closing date is in jeopardy and why!

Get your client on the plan. Get your realtors® on your plan. Get your inspectors and title agents on board to follow the plan and you will create a great experience for the customer and still close most transactions within thirty days. Obviously new construction and certain local bond programs, as well a USDA loans in certain areas will take longer due to uncontrolled turn times by outside agencies, but you can control most of the process most of the time if you set the proper expectations with your full document pre-approval letter!

Questions or comments: mike@IMTcoaching.com or visit us online at http://imtcoaching.com