“Will the New Year be a “NEW” Year?

Just a few days left in 2016 and we are all going to usher in 2017 this weekend. However, just because we celebrate “New Year’s”, it doesn’t always translate into a “NEW” year! With that in mind, and avoiding making resolutions that we know we won’t implement, what are the changes you are prepared to make in 2017?

Now, if 2016 was as good as it gets for you, and everything that worked for you in 2016 will work just as well or better in 2017, then there are no changes you need to make. But if 2016 wasn’t as good as it gets, or the things you did weren’t working well enough to get you to where you needed to be, then what are you prepared to do to make the changes needed for a different result?

To help you along, I have a few questions that might frame the picture for you.

  • Did you meet or exceed all of your professional targets in 2016?
  • If you lost 80% of your refinance business, would you meet next year’s production targets?
  • Are you currently working less than 50 hours a week?

If you answered “NO” to any of these questions, you have some work to do! If you answered “NO” to ALL of these questions, you really need to look at your business and get a better plan!

It all starts with an honest assessment of your numbers.

  • What business did I do?
  • Where did that business come from?
  • How much time was spent generating the opportunities?
  • How long does it take me to go from contact to closing?
  • Am I closing 40% of my referrals or more?

If you don’t have a real idea of your own numbers and how your time is spent to get those numbers; you have no chance in making solid adjustments! You can’t create more time. That is why I want to focus on the 50 hour work week. Many will say they work more than 50 hours a week, but very few people really do; they just burn more than 50 hours getting their work done! There is a big difference in how long things take you, and how long things should take to get done!

So as we look at 2017, see it as an opportunity to make the adjustments needed to reach the professional projections you have made for yourself. Reaching your targets, understanding your business, and getting your work done in 50 hours or less a week can be accomplished, providing you are honest with the math, the plan, and the effort! If it’s going to be “NEW”, it’s up to YOU!

Have a healthy and safe New Year celebration! I am looking forward to a productive and profitable year for all of you!

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


“Expired Opportunities!”

Merry Christmas everyone! I wish all of you a safe and happy holiday and much joy with your friends and families!

This year we find that Christmas and New Year’s fall squarely on the weekend. Plenty of ways to make excuses why you aren’t out and about prospecting for sure; but also a few good reasons to be engaged! One of those reasons would be expired listings! The end of the year is the busiest time for expired listings. Many people who wanted to see have found themselves still in their homes for the holidays and their listings about to expire!

Expired listings are an opportunity for a mortgage professional to go out and engage people who really wanted to move on, but find themselves with their lives on hold. Some may have come on the market priced too high and became stale. Others might have issues that need to be resolved that have cost them opportunities. The reality is, they wanted to go but don’t have a plan to make that happen. As a mortgage professional, you are in a position to help!

First you will need some help from your Realtor® referral partner identifying the listings that are about to expire. Then, you will need to figure out why the house did not sell. Obviously your agent can be of some help in that regard. Spend some time doing the research and running the numbers. Maybe you will find quick answers, but you may have to do more work. Remember, your agent can’t communicate with the seller while the house is still listed with another agent. Nothing stops them from sharing information with you!

Once you get an idea of what the property landscape looks like, you will need to reach out to the seller and offer your help. Asking simple questions like, “Are you still interested in selling your home?” or “Why do you think you house hasn’t sold yet?” are good ways to break the ice. You can tell them that as a financial professional, you might be able to look at the situation and offer some potential solutions. Depending on the property condition, or other outside factors, you might be able to identify the issues behind the lack of an acceptable offer?

Sometimes it comes down to looking at the offers and the dollars differently. The seller may have received an offer that was short of his asking price. Sometimes it looks like a great deal of money until you break it down for them. Say the offer was $10,000 less than the desired selling price. That seems like a great deal of money. But in terms of monthly payment, it’s really less than $50 a month on a 30 year mortgage payment.

Now I know that even $50 a month sounds like a great deal of money, but let’s look at the seller’s cost of waiting. Interest rates have gone up since summer. In fact, the mortgage payment on a 30 year fixed rate loan of $200,000 has gone up by about $60 a month since the summer due to higher rates! Had the seller taken the offer of $10,000 less a few months ago, they would have actually saved about $10 a month by financing a larger amount under the lower rates!

Sometimes it just takes a few minutes to change a person’s perspective. As a mortgage professional, you might be in a position to help an expired listing develop a new selling strategy? And who knows, if they aren’t happy with their current agent’s approach, you can certainly recommend someone for them to talk too that might have a plan more to their liking?

Don’t waste the week between Christmas and New Year’s. Even if you only talk to one potential expired listing a day, you might find yourself with a few new opportunities for 2017!

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

“Focus on what matters”

We have spent a great deal of time this year focusing on details and specifics. In many cases, as a coach, that is what your job is, to be aware of the details and help your clients incorporate those details into actions that generate the results they are looking for. For many, the remaining days of this year will be spent looking for the next party to go too! While I think the parties are great, it is important to keep focused on your process and your schedule. Failing to do so will only cause a lag in your pipeline that may take months to correct!

What matters to people now are rising interest rates. The Fed moving the needle will undoubtedly cause some severe volatility and continue the overall trend of higher rates. It is important to focus on what matters! Rates are going up and certainly aren’t as low as they were just a few months ago. But that is the market we live in. Don’t allow the conversation to become negative. Focus on what matters! What matters is that rising rates are still less of a burden than rising rents!

Sure it costs more money each month with higher mortgage rates. But have you taken the time to do a rent vs own comparison? Rising home prices and higher rates make for a higher monthly payment, but that payment didn’t go up anywhere near as much as rents did year over year. So while the monthly payments are certainly higher than they would have been a few months ago; rents are moving much more quickly higher in most markets. Take this opportunity to share these thoughts with a few of your real estate referral partners. Look at properties and their rental equivalents, do the math and see what your market looks like. I am sure that owning still represents a significant value over renting!

The other area of focus is timing and speed. While some people would have you believe that you need to focus on the speed of the pre-approval process, I contend that the pre-approval process is exactly where you need to focus and spend the time to get everything right and in order! The speed in the transaction needs to be from contract to closing because that is where the value is for the consumer! Why do I say this? Well, look at your rate sheets and note the cost of extending a rate lock or a longer lock period. You will quickly note that using a shorter rate lock saves your customer money!

Get the numbers on paper. Show the customer and the referral partner the real dollars involved in having to extend a lock or lock for a longer period of time. Look at the real dollars and you can see that it isn’t the speed of the pre-approval that matters; it’s the speed in which you can take that deal from contract to closed!

So don’t be put into a position to quickly help someone into a bad choice or to lose money. Focus on getting the deal done correctly and being fast and efficient where it really matters, where the money matters, the time you lock to the time the deals closes is where you have the need for speed!

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

“Don’t lose momentum”

It is very likely that by now you have put together all the deals you are going to that are going to close in 2016. In many cases, both originators and their referral partners take their feet off the gas pedal and begin that long coast into the next year. I am here to tell you Don’t Do It!!!

Every year I see it happen, the “year” is seemingly “over” so people relax and hit the parties, go off shopping, or just goes through the motions of “pretending” to work every day. Now notice I didn’t include vacations. Vacations are a great thing to me and an important feature of a productive person. So if you are truly going on vacation, then go! If you are just going through the motions, stop it right now!

Momentum is a very powerful thing. We often don’t realize how important it is to generate and maintain your momentum until you are looking at a giant hole that once was your transaction pipeline! Like water flowing through a pump, your business flow is much the same. Like an old farm pump, you have to work really hard for a period of time to even begin to get the water to flow. As you continue to pump the handle, the flow of water begins to increase. That very first stream of water may not be as clean as you would like, or as much as you would like, but as you continue to pump the handle, the flow gets stronger and the quality of water gets better!

Just like the farm pump, you need to be prepared for what to do with the water once it starts to flow. If you use your final vessel to collect the first dirty water, you now ruin the clean water when it comes, or have no room for it when it does! You need to be prepared for both! Just like in your business, you are likely to not get the best referrals right up front, but it gives you the chance to show your systems and be sure they function well so once the “better water” starts to come, you have a good way to handle the business you really want and to keep that business flowing!

As with the farm pump, once you stop pumping, the water slows and then will eventually come to a stop. The longer you wait to resume pumping, the longer it takes for the water to flow and the quality to come back! Your business is the exact same thing! You don’t have to work your business as hard all the time, but you can’t leave it alone completely for too long or you run the risk of never getting back the quantity and quality you once had!

So the action plan for the next few weeks is to be certain you are engaged with your referral partners. Not just at holiday parties or events, but by having meaningful conversations about specific actions and activities you would like to plan in the first quarter of 2017! Get commitments and secure and schedule appointments! You can’t allow your referral partners to stop working their “pumps” as well! If they dry up, YOU dry up! Over the next three weeks we will look at a few ideas that will help you keep things flowing into 2017!

For those of you who came by and said hello at the Triple Play Event in Atlantic City the last couple of days, it was great to see you and share our new “Power Partnerships” program with you! We are very proud of what we have put together and your warm reception of this new program was very much appreciated! For those of you who would like to learn more about “Power Partnerships” you can go to www.rlppnow.com and take a look.

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

“Locks to Learn”

This may seem like a very obvious observation, but it’s one that I needed to share. For many in the business of real estate and real estate financing, they have never been through a rising rate environment before, and as such, have never had to deal with the importance of rate locks. Here are a few things that I think everyone needs to be aware of:

  • The free market determines interest rates, not any one individual.
  • Time matters!
  • Think of it as insurance.
  • You might NEVER see that rate again.
  • Offer information but never give ADVICE!

Far too many people believe that a loan officer or a particular lender has the ability to move the markets. Mortgage interest rates are set by the entire market. While some lenders do have some minor ability to impact the rate on the loans they provide, as a whole, the market is the market and rising rates are a function of the markets! Your job is to explain rates and points, products and programs, lock options and the costs associated with them.

We also must explain in detail the cost of time. We all know there are a number of ways to lock a rate. Some programs have a degree of flexibility and others are etched in stone. But the basic rule is, the longer you need the lock, the more it’s going to cost! Share information about the different types of loan locks and what is required in order to lock a rate.

I have found in the past if you explain a rate lock like an insurance policy, people have an easier time understanding it. Everyone has some form of insurance. You always have to pay for it, but you don’t always use it. And just because you don’t use it, doesn’t mean they are going to give you back your money!

You have to be very careful to explain the long term markets and where people are in that history. 30 year fixed rate mortgage loans over the last 45 years have ranged between 17% at the high, and 3.25% at the low. If you take the average over that time, we see the rate at 8.26%. So while rates have moved up, historically we are still much closer to the bottom than the top. You must caution your clients about the potential real costs of waiting. Rates may NEVER go lower than where we are, but they can always refinance down the road if they do!

NEVER OFFER ADVICE!!! You are NOT A BOND TRADER! You don’t know for sure where rates are going or have the ability to see into the future! All you can do is to share information and options about the rates in question, show in detail the costs associated with each option and let the customer choose a path. It’s their money and their set of values. Some people are happy to pay a few dollars more a month than a point or two up-front. Some people have real emotional hurdles at certain rates. It is important that you share the real numbers and costs about what each option costs, as well as the risks if they do nothing!

Rate locks are not that complicated. It is important that you know your rate sheet and the costs of each program and investor because all are not the same. You also can’t hide from a rising market. Rates go up. The cost of houses goes up. You control neither! Just share the real information. Just as I said last week, rates are going up, home prices are going up, and so is the cost of RENT, but with renting you NEVER have the option of stopping the rise in cost!

Information, education, and options! That is your job; help the customer make an informed choice. More than that and you are playing with fire!

Questions or comments: Mike@IMTcoaching.com