Skip Realtors, Why Mortgage Brokers need to Market Direct
Categories: Realty Realities, Disintermediation, Lead Generation, San Francisco Bay Area, Blogging
The Equity Ladies are Cory Lerner and Miriam Mangrum and they are taking the LaMorinda area of the East Bay by storm (Lafayette, Morage and Orinda). They've been contributing locale descriptions of the area on MyHouseKey.org. Cory is one of Transparent's new contributing bloggers - she (and Miriam) has an original vision on building a mortgage business that I find refreshing... she realizes that the key to successful marketing is to break the mold by blogging locally and to not follow some of the "rules" that every mortgage broker is taught. Here's Cory - - -
One interesting observation for the newer loan agent is related to the advice they are often given – to court realtors and build relationships in order to get referrals. Although this seems like a great idea, and probably was at one time, times have changed and this is no longer a recommended exclusive strategy.
There are a few reasons for this rationale.
First, according to the NAR, 90% of the business is being done by only 10% of the realtors. (a shift from the former 80/20 rule). That means that only a handful of realtors have a good business, especially now that they market has taken a slow-down to “normal” times. Guess who is chasing them? That’s right – hundreds of loan officers in a given locale. Some realtors have told me that they get 6-10 calls A DAY from mortgage people trying to meet with them.
Second, no realtor in their right mind will trade-in his or her relationship with a proven loan officer when it affects the realtor’s income. Most realtors have three loan officers they work with and cannot accommodate any more, nor do they want to. Most new loan officers will have to wait a long time to be given that one chance to impress – and it’s often for a junk deal that will be hard to deliver on.
Third, any buyers who have owned a home know by now that they must be pre-qualified for a loan before any realtor will take them seriously. Most buyers already know someone in the loan business and have gone through the motions of pre-approval. By the time they reach the realtor, they have their financing lined up so there is no opportunity to refer them to a loan officer. Although a good loan officer will coach their realtor contacts to recommend a “second opinion” to the buyer about their loan, few realtors will recommend or encourage their buyer to talk to yet another “loan guy”.
What does this mean? Loan officers need to do more consumer direct marketing. They need to limit the time they spend on chasing new realtors. They need to insert themselves earlier into the buying process – not at the end when it’s too late.
This is great advice, thanks Cory!
Technorati Tags: mortgage broker, loan marketing, realtor marketing, equity ladies
Pat and Cory, thanks for this post. The advise is long over due. Loan officers and title agents need to understand that consumers welcome their appearance early in the buying process. Both disciplines have a great deal of knowledge and expertise to share with nervous purchasers.
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Pat: I agree. Times have changed and it's a whole new world out there for marketing. The reverse side of this scenario is recognition by Realtors that consumers are making their own choices. I know that is hard for many as they are used to controlling their business. It will be interesting to see where we all are in a few years.
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Great to hear from Ed and Diane, both from the title industry, who advocate the direct to consumer marketing approach... I applaud your efforts to educate and change the industry in your blogs Title-opoly and Radical Title Talk.
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When you form a relationship in the
mortgage">http://www.mortgagewebsuccess.com">mortgage
business this will potentially take your marketing to another level. I say it will take it to another level because as they say six degrees of separation. You never know who the contact knows ...
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