The 7 Biggest Mistakes That Cause Loan Officers To Fail

by Aidan P

What common loan officer marketing mistakes consistently sabotage a L.O.’s career and business? How can you beat these blunders to build a rich pipeline of income you can count on?

  1. Consistency

Consistency Mortgage Marketing
The number one threat to every business and independent professional’s career is running out of cash flow. All it often takes is a few weeks without closings turning in dollars to send a career or business on an irreversible downward spiral. You can only beat this by being consistent in marketing for new originations in order to keep the processing department full of files and closing calendar stacked.

Yet, far too many loan officers just work in spurts. They do a little marketing and prospecting, land a couple of loan applications, and then sit back and wait to get paid. They get too busy with managing active applications or just mentally check out for the rest of the month because they made enough money for the bills and a few epic happy hours.

Sometimes those loans don’t close and turn into dollars. At best these loan officers are left starting from scratch the next month. There is no consistency in marketing, prospecting or income. It’s highly risky and the fastest way to put yourself back in the regular 9-5 pool looking for a job with someone else.

It doesn’t matter what type of marketing you do, all mediums produce their best results with consistency. That includes direct mail, phone work, magazine ads, blogging, email marketing campaigns and social media. With all the automation tools available today there is really no excuse not to have multiple marketing channels working on autopilot for you all the time.

  1. Not Being There for Inbound Calls

inbound mortgage calls
Generating inbound leads really isn’t that difficult. Where far too many loan officers and real estate professionals in general drop the ball is in being available to handle those leads. Don’t waste money on marketing if you can’t or won’t take the lead calls.

It’s far better if you pace out your inbound leads so that you can take them live than struggling to follow up. Your conversion rates and marketing ROI will be a lot higher. If need be spread out your budget further to generate a more even number of calls on a daily basis, then getting slammed a couple days a month. This can easily be done by batching mailings and email blasts, or by selecting the right features in your Google Adwords and Facebook Ad Manager accounts.

  1. Not Closing & Asking for the Sale

asking for mortgage sales
We often cringe and hide from hard sales pitches from old school salesmen. Yet, failing to push for the commitment, close and ask for the sale is wasting opportunities. All some people need is that extra nudge to make the application and commit. If you are offering a needed and good loan, you should be confident that you are adding value and are helping them by getting them to take the next step in the process.

If it doesn’t work the first time, follow up. Even if a prospective borrower has concerns, they are often sitting at home, just waiting for you to call, text or email and ask them to buy.

  1. Not Making the Most Out of Every Lead

making most of mortgage leads
The loan officers with the most business today are those who worked on filling their pipeline last year, and the year before. Instead of just hanging up the phone or shredding a weak lead, they put those contacts into their mortgage CRM and began nurturing them and stayed in touch. Now many of those prospects are ready to buy, have better credit scores and have been collecting all the paperwork they need to get their loan underwritten successfully.

  1. Not Understanding Lifetime Value

lifetime borrower value
Many loan officers just don’t get the concept of the lifetime value of a customer, or haven’t done the math. Try it out. You might be blown away by just how much each prospect and new client can be worth.

If you only make $3,000 on the average closing, it can add up fast. If you start a relationship early by helping a borrower with a starter home, they may end up moving and needing a new mortgage an average of every 5 years. You can even use 10 years to be conservative. If you get them at 20 and write their last loan at 70, that’s $18,000. There’s a good chance they’ll buy a second home and at least one investment property during that time. If you are doing a good job, they should be able to refer you at least one deal every time they are doing business with you too. That makes them worth at least $48,000. If you are in a high end market you might be making that number of every transaction too.

If each prospect is worth $48,000 or maybe over $480,000 to you, might you treat them a little differently? For many it should affect the deals they give, the loans they set clients up with and how much is invested in retaining and nurturing them.

  1. Failing to Accurately Calculate Cost Per Lead

cost per mortgage lead
In order to balance your accounts and accurately compare marketing choices you’ve got to know your cost per lead. Many don’t. Or at least skip a lot of the math. If you don’t really know your cost per lead and cost per closed deal, you are going to pass up on profitable new options which may be cheaper, or are going to spend too much and go broke on ones which are too expensive. Make sure you are calculating the time and money to create marketing pieces, set up new campaigns, and handle them when they come in.

  1. Not Starting with SOI Marketing

Mortgage SOI Marketing
Not beginning with reaching out to their sphere of influence is one of the biggest mistakes that new loan officers make. In fact, it may be the #1 make or break factor which you can use to predict if a LO will make it or not. This means reaching out to personal contacts, friends, family, past coworkers and ex bosses to let them know you are in the business. That you can help them and the people they know. You can do this via social, letters, phone calls and email. Just do it. Fortunately, it is never too late to do it if you missed it. Put them in your mortgage CRM, make contact and stay in touch.

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