The Mortgage Cicerone - The Loan Attraction Coach - Con

Jackass Proof Your Business.

A New Post By Chris Johnson
Business Development Consultant
Read other posts by Chris Johnson

I hate Real Estate jackasses.

You know the types, some party to some transaction that hijacks everything, tries to twist everything.  These people renegotiate after the deal is decided...with equal parts threat, greed, ignorance and malice?  

Jackasses and fraudsters are why our industry is where it is.  And I've had enough.  In December of last year, a customer was referred to me that was upside down on 6 properties he bought in Phoenix and Florida.   He had bought them in...wait for it...fall of 2005.  They were sitting unrented, and the total equity loss that he had was over 75,000 per property.   He had a stable job, and was looking forward to retirement in a few months.  This made the guy nervous, and he wanted to punish everyone around him.

Specifically, he wanted me to refinance them with 18 month old appraisals, for little to no fees and a 6% rate.  He walked me down the path really slowly, refusing to answer my questions.   He was a jackass, he caused this mess, and wanted someone to clean it up.

When I wanted to verify something, I had to do it  on my own.  He was familiar with the process, and trying to get me on the hook for making loans without knowing anything, as if a loan in Jan of 08 was gonna close without an appraisal.  I was sucked in to the 1.4mm in business that he had to offer, but spider-sense was definitely tingling. 

And when he called my cell phone 14 times before 9:30 am on a Saturday, I told him that I was done speaking with him, and I will send the notice of denial out, and that I will contact law enforcement if he called again.  I got one 'nasty email,' from him that impugned my character, but I was free.  And that was the last Real Estate Jackass I ever dealt with.

What are the signs of a Real Estate Jackass?

1. They overstep your boundaries.  They call you at home, on the weekends, at numbers you didn't expect for them to call you.  They call you day and night, all the time, and feel nothing about making demands of you.
2. They trickle information in to you.  This guy was well coached, he first asked about loan parameters, and interrupted me.  He kept me on the phone, committing me to say yes to an increasingly bad scenario, unraveling one detail at a time. 
3. They remember every nuance of what you said, and hold you to every detail (without keeping theirs).
4. They first call your work number, leave a message that says 'call me,' with no information.  Then they call your cell.  then they check back at both numbers, not always leaving messages.
5. They renegotiate after the fact when the leverage shifts to them (A buyer at the last minute who demands an inspection credit).
6. Wanting you to give first. "Just take a beating on this first deal then I'll give you ALL my business."

Honor has been missing from this industry for years.  Jackasses abound.

What do you do with a jackass?

1. Reserve the 'walk away' option in all things that you do.  At any point in a transaction if you see the signs and your intuition tells you that you're going to be paying out the nose for dealing with this guy, reserve that.  I carve it out in my initial presentation saying that I personally end my relationship with any customer that makes me uncomfortable.
2. Charge More.  Seriously.  Jackasses abound, and what you have to do is without appology tax them for their behavior.  If you've got the 'Win Win or No Deal' ethos summarized in #1, it will be fine.
3. Don't Get Emotional.  We're here to facilitate transactions, not to go to war over a leaky pipe somewhere.  We want to stay reasonable, even in the face of stupidity.  Jackasses will try to pull you into insanity with emotion.

Now, to totally jackass proof your business, you gotta be working with a good variety of clients.  When you're not prospecting, marketing and taking in tons of clients, you're subject to the whims of Jackasses.    Sometimes, you have to deal with those idiots to pay the mortgage.  In order to fully jackass proof your business, you have to give yourself options and outs.

Massive amounts of prospecting and marketing keep you Jacaksass Proof.

When you do your marketing,  you'll also be less likely to encounter jackasses because you'll exude the strength and confidence that comes from being a top caliber person.  Jackasses feast on everyone they think that they can...so give yourself options to NOT work with jackasses.

Chris Johnson has a program for getting enough business to avoid Jackasses at http://loanofficersurvivaltraining.com.

The People You Know?

A New Post By The Mortgage Cicerone
A Guide for Mortgage Professionals
Read other posts by The Mortgage Cicerone

Have you every taken the time to think of or write down the names of all the people you have known? When you you complete this exercise, the web of connections throughout your lifetime is wide.

Yet, HOW MANY ARE STILL INVOLVED IN YOUR LIFE TODAY?

Now ask yourself, HOW MANY HAVE FADED AWAY FOR ONE REASON OR ANOTHER?

Whether they are distant family members, old neighbors, friends from school, ex-coworkers and other casual acquaintances you have met along the way, they have all in some shape, way or form influenced or impacted your life positively or negatively.

It is important to know who you know now and have known in the past...it encompasses who you are today.

Now an even more important question is; WHO WOULD YOU LIKE TO KNOW THAT YOU PRESENTLY DON"T KNOW NOW?

When you ask yourself who you know now or who you would like to know, think about your current state of business and what you would like it to be in the future.

According to Jeffrey Gitomer:

"Who you know encompasses who you can presently connect with easily and obviously. The better you know them, the easier it is to make a connection. How well you know them determines how early or how late you can call them on the phone.

There is power in who you know. Not just the connection power. Growth power. Success Power. Even fulfillment power."

That's why it's critical to your career to know:

1. Who do you know?
2. How well are you connected?
3. Do you know how to make a connection?
4. Who knows you?

Who knows you and did you make a connection?

It's more than just knowing someone, it's making a critical connection with the people you want to know and need to know.

It's the connectors that succeed long term in the mortgage and real estates business. Yet connecting is more about giving than receiving and that's where so many people striving to be a connector fail.

TO BE CONTINUED

Have you every taken the time to think of or write down the names of all the people you have known? When you you complete this exercise, the web of connections throughout your lifetime is wide.

Yet, HOW MANY ARE STILL INVOLVED IN YOUR LIFE TODAY?

Now ask yourself, HOW MANY HAVE FADED AWAY FOR ONE REASON OR ANOTHER?

Whether they are distant family members, old neighbors, friends from school, ex-coworkers and other casual acquaintances you have met along the way, they have all in some shape, way or form influenced or impacted your life positively or negatively.

It is important to know who you know now and have known in the past...it encompasses who you are today.

Now an even more important question is; WHO WOULD YOU LIKE TO KNOW THAT YOU PRESENTLY DON"T KNOW NOW?

When you ask yourself who you know now or who you would like to know, think about your current state of business and what you would like it to be in the future.

According to Jeffrey Gitomer:

"Who you know encompasses who you can presently connect with easily and obviously. The better you know them, the easier it is to make a connection. How well you know them determines how early or how late you can call them on the phone.

There is power in who you know. Not just the connection power. Growth power. Success Power. Even fulfillment power."

That's why it's critical to your career to know:

1. Who do you know?
2. How well are you connected?
3. Do you know how to make a connection?
4. Who knows you?

Who knows you and did you make a connection?

It's more than just knowing someone, it's making a critical connection with the people you want to know and need to know.

It's the connectors that succeed long term in the mortgage and real estates business. Yet connecting is more about giving than receiving and that's where so many people striving to be a connector fail.

TO BE CONTINUED

A Dirty Word In Sales Management - Micro-Management

A New Post By The Mortgage Cicerone
A Guide for Mortgage Professionals
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Nobody Likes a Micro-Manager!

Whenever someone mentions a micro-manager, people grimace. It's as if this is a dirty word. Many times, they will remember a particular person who micro-managed them or someone else. These people are usually remembered unfavorably. Another term for a micro-manager is 'detailed oriented' which sounds better. Most micro-managers prefer this description. They see this as a positive management style. Their colleagues and employees see it for what it is. They regard the 'detailed oriented' person as a meddler who simply does not trust them to do their jobs properly. Sales people generally hate micro-managers. They prefer to be empowered -- left to do the things they are most capable of doing.

Is Micro-Management Inherently Bad?

No. In fact, this is a particularly useful management tool in certain circumstances. Used correctly, this tool can help would-be sales superstars reach their true potential. Used unwisely, it can severely limit good sales people. The truth is that many sales people only reach stardom after they have acquired the habits of success. These habits consist of doing the right things consistently. There is never a dispute among sales people as to what these habits are or whether or not they should do them. They always agree that they will be successful sales people if they perform these successful behaviors as a matter of habit. Many agree that they should do them even to be moderately successful in sales. However, agreement does not always translate into action.

This is where the good sales manager comes in. He or she will help the sales person to develop and cultivate the right successful behaviors specific to the career. They continue to develop these successful behaviors until they become successful habits. They use micro-management to do this by micro-managing behaviors.

Who Hates Micro-Management Most?

Paradoxically, those who hate micro-management the most are the very ones who would receive the most benefit from it. These are the sales people who are still struggling to reach their potential. They continue to struggle because they have not yet learned the habits of success. While they pay lip service to it, they fail to practice the things they know they should - and even preach. They talk a good game. They simply do not follow through because they lack the discipline.

Why do they hate it so much? Because it holds them accountable for their behaviors. They would much prefer to be left to their own devices no matter how destructive this can be. Accountability makes mediocre sales people very uncomfortable. They feel they are being treated like children.

Some sales people are 'self-starters', capable of motivating themselves. These sales people regularly outperform their peers. They hate micro-management because it limits their activities. They have earned the right, however, to be left alone - and empowered!

Who Should Be Micro-Managed - And Why?

Sales managers who come from a background of managing successful sales people have a great deal of difficulty when they take over a seemingly unmotivated sales force. They become frustrated when the things they did before no longer work. They tend to blame the poor quality of their new sales people. They would do well to use micro-management as a tool to get their sales people to the point where they are more comfortable.

This means helping the sales people to develop successful selling behaviors and holding them accountable for these behaviors. For example, in a motivated sales force, it is quite in order to tell them, "These are our targets. You are required to closw x number of loans by the end of each month", and then let them do whatever is necessary to reach the targets (as long as it's legal and ethical).

Try that with a lesser sales force (I have seen myself early in my career do just that). Sure, they help by teaching their sales people ratios, presentation skills, closing skills and all the other good things sales people should know. They then become frustrated when the sales people still do not perform up to standard. They will finally reach the conclusion that their sales people are simply not motivated. So they spend an enormous amount of money on a motivational 'guru' who will fire the sales people up for a week.

Perhaps they should look at managing behaviors and holding their sales people accountable for performing these behaviors. In the above example, they may require their sales people to make a defined number of phone calls, face-to-face calls or follow-up calls each day. They should require that their sales people prove that these behaviors have been done each day. They should institute a process for managing these behaviors so that they become part of the way the sales person does business. Only when they are satisfied that the sales person is now doing these behaviors as a matter of habit should they depart from the micro-management style. At this point, the sales person would have earned the right to be empowered.

Micro-Management Restraints

From the above, it can be seen that micro-management has limitations. There are, and should be, two limitations:

• It should be applied selectively. Not all sales people require it.
• There should be time constraints. A sales person who never comes off micro-management should be let go. The cost in time is simply not worth the investment.

A Final Word

If sales managers genuinely care for the sales people they manage, they will use different strategies for each individual sales person. Micro-management takes time and effort. Sales managers should remember that they are judged not by their own successes but by the successes of the sales people they manage.

THERE IS NOTHING MORE IMPORTANT IN THE DAY OF THE SALES MANAGEER THAN DEVELOPING SALES PEOPLE WHO SUCCEED.

Is The Customer Always Right?

A New Post By The Mortgage Cicerone
A Guide for Mortgage Professionals
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Is the customer always right...no matter what?

My first years in the mortgage business, I believed the answer was emphatically yes. After all, that's what my business professors taught me in college. However, after a few years of dealing with more than a few difficult customers, I seriously began re-thinking the customer service mantra "the customer is always right."

Have you ever had a customer who was impossible to please? No matter what you did, nothing made them happy? I have and below are a few other facts I realized:

• They were typically my lowest profit loans (if they closed at all)
• Allocated three to five times more time/effort/stress on them (at the detriment of my loyal clients)
• Never referred me future business
• I didn't like them
• Shopped you to the very end
• No customer loyalty

No matter how you sliced it, those customers DID NOT excite me. Nor, could I see the likelyhood of building a strong business model by allocating my limited resources towards them.

We are fortunate the mortgage business is an industry that helps people. One of my greatest satisfactions is knowing I make a difference in my clients lives. However, I also believe our business transactions should be a win-win-win situation. It should be a win for our client(s), a win for the company we work for and a win for the loan originator.

It boils down to one simple question: As a loan originator, would you rather work with people you like, who are loyal, profitable and refer you future business or with those that are not and make your life difficult?

Duh, that's even easy for me to figure out!

Does this mean we ignore the customer and treat them badly? NO WAY...they are after all, the reason we are in business. However, it does mean we place limits on what we will tolerate and whom we work with.

When I fully understood and embraced this concept, my career took off and so did my earnings. I remember the first time I released an extremely difficult client. I simply stood up, stuck out my hand for a handshake and graciously explained; "When we first met, I promised I would be honest with you. It's very evident you are not happy with the services and rates I can provide. Based upon that, I believe it would be in your best interest if you worked with another mortgage professional that can better meet your needs."

What is nice is many people will actually apologize after you tell them this and others will leave, both which are fine.

Remember, you do not have to work with everyone, nor should you. Create a target customer profile. Then target those customers that fit your profile. You don't have to please everyone. If you do, no one is happy and and both parties will lose out in the end...it should be a win-win-win transaction. This goes for customers, Realtors, title reps, lenders, and every other vendor in your life. If the relationship is not pleasant, find a way to fix it quick or end it. Life is too short and blood pressure rises too easily to deal with unpleasant people.

As an exercise, start going through your past loan files and identify the individuals whom were the most difficult to work with. I bet you will find you:

• Earned the lowest amount per hour.
• Spent more time on their files, on average, for less money.

Note: The time spent with difficult clients, is time you could have been better serving your good clients (turning them into loyal clients), marketing, networking, being with your family or doing something you enjoy.

A Cicerone Classic

Is the customer always right...no matter what?

My first years in the mortgage business, I believed the answer was emphatically yes. After all, that's what my business professors taught me in college. However, after a few years of dealing with more than a few difficult customers, I seriously began re-thinking the customer service mantra "the customer is always right."

Have you ever had a customer who was impossible to please? No matter what you did, nothing made them happy? I have and below are a few other facts I realized:

• They were typically my lowest profit loans (if they closed at all)
• Allocated three to five times more time/effort/stress on them (at the detriment of my loyal clients)
• Never referred me future business
• I didn't like them
• Shopped you to the very end
• No customer loyalty

No matter how you sliced it, those customers DID NOT excite me. Nor, could I see the likelyhood of building a strong business model by allocating my limited resources towards them.

We are fortunate the mortgage business is an industry that helps people. One of my greatest satisfactions is knowing I make a difference in my clients lives. However, I also believe our business transactions should be a win-win-win situation. It should be a win for our client(s), a win for the company we work for and a win for the loan originator.

It boils down to one simple question: As a loan originator, would you rather work with people you like, who are loyal, profitable and refer you future business or with those that are not and make your life difficult?

Duh, that's even easy for me to figure out!

Does this mean we ignore the customer and treat them badly? NO WAY...they are after all, the reason we are in business. However, it does mean we place limits on what we will tolerate and whom we work with.

When I fully understood and embraced this concept, my career took off and so did my earnings. I remember the first time I released an extremely difficult client. I simply stood up, stuck out my hand for a handshake and graciously explained; "When we first met, I promised I would be honest with you. It's very evident you are not happy with the services and rates I can provide. Based upon that, I believe it would be in your best interest if you worked with another mortgage professional that can better meet your needs."

What is nice is many people will actually apologize after you tell them this and others will leave, both which are fine.

Remember, you do not have to work with everyone, nor should you. Create a target customer profile. Then target those customers that fit your profile. You don't have to please everyone. If you do, no one is happy and and both parties will lose out in the end...it should be a win-win-win transaction. This goes for customers, Realtors, title reps, lenders, and every other vendor in your life. If the relationship is not pleasant, find a way to fix it quick or end it. Life is too short and blood pressure rises too easily to deal with unpleasant people.

As an exercise, start going through your past loan files and identify the individuals whom were the most difficult to work with. I bet you will find you:

• Earned the lowest amount per hour.
• Spent more time on their files, on average, for less money.

Note: The time spent with difficult clients, is time you could have been better serving your good clients (turning them into loyal clients), marketing, networking, being with your family or doing something you enjoy.

A Cicerone Classic

What Is Mortgage Planning?

A New Post By The Mortgage Cicerone
A Guide for Mortgage Professionals
Read other posts by The Mortgage Cicerone

Over the last few years, the term or title "mortgage planner" has been growing significantly in its use by mortgage originators.  While sounding impressive, what does it really mean?  Is it possible for someone to actually plan a mortgage?  After all, don't lenders simply establish the terms of various mortgage products and at that point let the consumer merely select the one they figure best suites their needs? 

For the consumer, where, what and how does the so called mortgage planning actually occur?

<Click Here To Continue Reading>

Generating Referrals Through Affinity Marketing

A New Post By The Mortgage Cicerone
A Guide for Mortgage Professionals
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Came across a great article regarding Affinity Marketing at one of my favorite sites; Top Producer Strategies.

Affinity marketing  simply means forming mutually beneficial business relationships and the continuing process of  nurturing and growing the referral trees that stem from them.

Affinity marketing relationships could be a relationship between a financial planner and mortgage professional, a Realtor and mortgage professional, a corporation and a mortgage professional and/or Realtor and/or financial planner, etc. A sword has two edges. Just as you will only refer your clients to professionals you know, trust and respect, you will only receive referrals from those who know, trust and respect you.

To find out more details, click the hyperlink below and it will take you to the Top Producer Strategies article.

Continue article   

Great Thoughts To Ponder (5/23/08)

"Customers don't make up stories about your business. It is you who creates them - the customer simply retells them. How the story is told and what the content is, is up to you." -- Jeffrey Gitomer

"The twin killers of success are impatience and greed."  --  Jim Rohn

"There is more treasure in books than in all the pirate's loot on Treasure Island... and best of all; you can enjoy these riches every day of your life." -- Walt Disney

"Read something positive every night and listen to something helpful every morning." -- Tom Hopkins

"Within you right now is the power to do things you never dreamed possible. This power becomes available to you just as soon as you can change your beliefs." -- Dr. Maxwell Maltz

"Striving for perfection is the greatest stopper there is...It's your excuse to yourself for not doing anything. Instead, strive for excellence, doing your best." -- Sir Laurence Olivier

"Telling others is the key to changing your wishes into dreams." -- Chris Widener

"The greater the danger for most of us lies not in setting our aim too high and falling short; but in setting our aim too low, and achieving our mark." -- Michelangelo Buonarroti

"Some people plant in the spring and leave in the summer. If you've signed up for a season, see it through. You don't have to stay forever, but at least stay until you see it through."  --  Jim Rohn

"How different our lives are when we really know what is deeply important to us, and keeping that picture in mind, we manage ourselves each day to be and to do what really matters most."  --  Stephen Covey

"Decide upon your major definite purpose in life and then organize all your activities around it." -- Brian Tracy

"All successful people are people of purpose. They hold fast to an idea, a project, a plan and will not let it go; they cherish it, brood upon it, tend to develop it; and when assailed by difficulties, they refuse to be beguiled into surrender; indeed, the intensity of the purpose increases with the growing magnitude of the obstacles encountered." --  James Allen

Client Contact Tip: Economic Stimulus Checks Phishing Scam

A New Post By The Mortgage Cicerone
A Guide for Mortgage Professionals
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It's SO important to keep in contact with your clients, especially when you have important information to share with them.

In my opinion, this is definitely something I would get to my circle of clients:

Economic Stimulus Checks Phishing Scam

May 8, 2008, News Report

The FBI warns consumers of recently reported spam e-mail purportedly from the Internal Revenue Service (IRS) which is actually an attempt to steal consumer information. The e-mail advises the recipient that direct deposit is the fastest and easiest way to receive their economic stimulus tax rebate. The message contains a hyperlink to a fraudulent form which requests the recipient's personally identifiable information, including bank account information. To convince consumers to reply, the e-mail warns that a failure to complete the form in a timely manner will delay the issuance of the rebate check.

Click Here For Full Story

Click Here for FBI News Release

Do You Utilize Photoshop Marketing & Business Practices?

A New Post By The Mortgage Cicerone
A Guide for Mortgage Professionals
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I have recently been deluged with marketing materials from several different so called "mortgage marketing gurus" attempting to sell me their "System" for my geographic area. Each of these gurus promised to show how to develop an endless stream of clients that an LO can make at least five points a deal or pull in over $9,000 in fees on each FHA loan.

I had my pre-conceived ideas on the type of techniques and business practices advocated, however I wanted to give them a fair shake and truly research them.

After extensive research, I believe the video below serves as a metaphor for those "Systems" that in my humble opinion take advantage of borrowers:

This video shows you don't always get what you see. Ethical and professional mortgage originators never give their clients a loan program that has been photoshoped!

If You Can't Describe It, You Can't Sell It

A New Post By The Mortgage Cicerone
A Guide for Mortgage Professionals
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Imagine meeting someone at a party and while conversing with them you learn they are relocating to the area and currently looking for a home. Of course you tell them you're in the mortgage business and would be happy to help them with their mortgage needs. It's at this point they inform you their Realtor gave them a name of a person to call about getting pre-qualified and had planned on calling them tomorrow...

1. What would be your response?
2. What would be your next step in positioning yourself?
3. Do you even have a business card to give them?

Before reading any further, get a pen and piece of paper and within 90 seconds write down in three or less sentences what your response would be to the hypothetical person noted above.

If You Can't Describe It, You Can't Sell It

Were you able to clearly articulate the 3 W's:

1. What you do?
2. What makes you unique?
3. Why the potential client should work with you as opposed to another originator in a positive and compelling way?

My guess is most loan originators would be disappointed in their response?

If you were disappointed, imagine the reaction from potential clients and referral partners when you introduce your professional services to them?

If you are NOT:

1. Providing a compelling reason to give their business to you?
2. Positioning yourself as someone they trust?
3. Providing confidence, competence and clarity in your offering?

YOU will NEVER reach the point in your professional career in which you originally intended upon entering the mortgage or real estate industry. Instead, you will be relegated to bench warmer status and only getting to play (make decent money and have a steady flow of business) when the game gets out of hand and the coach sends in the 2nd and 3rd team players for mop-up (refinance and boom years, e.g. 2000 - 2005).

What's motivating is most everyone (99.5%) in the mortgage or real estate industry started out as a 2nd or 3rd teamer...even the superstars of our industry. What separates them from the pack is their ability to:

• Define their niche(s)
• Articulate and/or communicate their Unique Selling Proposition (USP)
• Establish systems that produce forward action from their clients, referral partners and vendors
• Inspire confidence in their ability to deliver
• Be trusted

Often, we as mortgage professionals are so close to the day-to-day particulars of the business, we often get caught up in the features, functions and benefits of the loan programs subsequently never learning or thinking how to describe both the mortgage process and what we do in simple and effective ways.

That is why a Unique Selling Proposition is so important to your career.

Much has been written on USP's, however what does that mean to YOU, the loan originator?

In a nutshell, an effective USP:

• Is designed to separate you from your competitors (and)
• You can have more than one USP (e.g. FHA, First Time Homebuyers, investors or even one that separates you from your company)

If you don't currently have a unique selling proposition - Develop one IMMEDIATELY! You can start by answering the following questions and you will be well on your way to developing your unique selling proposition(s).

• What makes you different from all the other mortgage lenders out there?
• What makes you better? Why should a prospect use you over a competitor?

Act immediately in developing you USP, because;

If You Can't Describe It, You Can't Sell It