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Loan Officer Training - how to take an effective loan application that generates locks - customer greeting and establishing rapport

By Edited Nov 13, 2013 0 0

Lead Conversion

Building Rapport

What is conversion ratio?  Conversion ratio is the measure of how many of your loan leads turn into applications (locks).  You or your employer will spend a lot of time and money in order to generate a lead.  Countless hours are spent doing market research, building referral databases, going to open houses, dropping in to sales communities, courting Realtors, etc.  All of this just to generate a lead.  Well, now that you have the lead (have your customer on the phone), how do you turn this lead into lock and later a funding?

You might think that taking a loan application is as simple as asking your customer a series of questions, inputing their responses into a form, running the information through a Desktop Underwriting system and "Voilà", you have converted a lead.  Well, it's not quite that easy.  If it were this easy, then there wouldn't really be a need for Loan Officers because computer programs would be able to take loan application and companies wouldn't need Loan Officers to convert leads. 

The lending industry is one the most competitive industries on the planet.  Many, many, many people have tried to be a Loan Officer but very few succeed.  95% of people who attempt a career as a Loan Officer will quit within the first 5 years.  Those are formidable odds aren't they?  Of this 5% that do make it, many struggle and are lucky to fund one or two loans a month.  You know who I'm talking about.  These are the Loan Officers better known as "order-takers".  Simply going through the motions in their monotone voices and wondering why they're not seeing results.  Burning through leads like they're throwing paper on a fire.  Every branch or call center has these Loan Officers, the under-achievers, constantly complaining about lead-quality, low appraisals and Underwriting.  In the same offices you will also have one or two Loan Officers who run circles around their peers.  It is not uncommon for 1 or 2 Loan Officers in a branch or call center to equal the production of all the other Loan Officers in that branch combined even when provided an equal amount of leads.  Now how is this possible?  What are these 1 or 2 Loan Officers doing that is different than their peers?  Why do customers want to do business with them?  What is their secret formula?

Believe it or not, the process of taking a good loan application is an art.  A great Loan Officer is like a great painter or an exceptional athlete.  A great Loan Officer understands the secret recipe for converting leads into locks.  The loan application is the canvass and the customer is the subject. 

Unfortunately, there is no single thing, that the exceptional Loan Officers are doing different than their peers, rather, it is a series of things, there is a formula.  So what's the formula? 

Most sales books you will read center around a simple premise: People want to do business with people that they like and trust.  In order for someone to give you their money, they will first have to trust you and it's really as simple as that.  If you don't first gain the customer's trust, you will NOT do business with that person, bottom line.  Also, if the customer doesn't like you then you won't be doing business with them either.  So how do you gain the customer's trust, how do you make the customer like you?

 As you go through the loan application with your customer, look for ways to gain their trus by asking the RIGHT questions.  "How long do you plan on being in the home?"  "Why are you moving?"  These are questions that will allow you to design a loan program to fit your customer's needs.  If someone is only going to be in the home for a couple of years, you might want to look at an ARM product to save them as much on their monthly payments during the time they are in the home or pay down the loan balance as much as possible during their short time in the home.  Conversely, if this is going to be the last home your customer plans to buy in their lifetime, we might want to point out the benefit of buying the rate down with points.  Get the picture?  Separate yourself from the competition by asking the right questions.

Next, look for ways to establish rapport with your customer during the application. "You're a computer programmer? Well that sounds interesting, how long have you been doing that?  Tell me more about that?  What do you do exactly?  If they've been with the same company for the past 10 years, well, that's an accomplishment isn't it?  "Wow, XYX company must like you to keep you around that long".  "You must be doing a great job for them"!  While these comments might sound cheesy to some of you, trust me, they will pay big dividends.  Taking a little extra time to show interest in your customer is what will separate you from your competition.

Give your customer your undivided attention.  While taking the application, don't be responding to emails, checking your loan pipeline, or last nights scores (trust me the person on the other end of the phone will be able to tell if you are).  Buying a home is the single biggest financial transaction many of your customers will make in their lifetime so don't take it lightly. 

Finally, it's vitally important to take your time with your customer during the interview.  The home buying process can be overwhelming to your customer especially if it's their first time buying a home.  You don't want them to feel rushed or that they are taking up too much of your time.  You're job as the  Loan Officer is to make the process an easy and pleasurable experience for your customer.  Your goal is not to confuse your customer, you are trying to make them comfortable and confident.  When you are finished with the loan application, your customer should understand exactly what do next.  "Mr. Customer, your next step is to go out and find a property, once you find a property you like you will make an offer on the property to the seller, once the seller accepts your offer you will sign a purchase agreement with the seller, you will then fax or email me a copy of the purchase agreement so that I can review it for you, etc, etc".  You want to establish yourself as the expert.  You want your customer to be excited when they get off the phone with you and you want to leave them with a good, positive feeling.  Make them want to call you back and when they do call you back you want to greet them with excitement: "Hey John, it's great to hear from you!"  How is your job going?  How is the home search going"?  What can I do to help you today?  Did you have any questions about the closing cost estimate I sent you?  Putting in a little extra effort while conducting your loan interview will make a noticeable difference in your career as a Loan Officer.

 

 

 


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