Summary
This article identifies common mistakes mortgage professionals make in a slow market. Learn how to avoid overspending, neglecting marketing efforts, and missing opportunities to nurture leads. Staying proactive and strategic during downturns is crucial for long-term success. By the end, you’ll know how to navigate challenging market conditions effectively.
Has business slowed down? Either because rates have risen or it’s a busy time of year. It’s coming into the holiday season and everyone you talk to is either away or going away or just too busy. You follow up with hot leads, but when you press them to submit the application for the loan you talked about, they say “I’ll do it after the holidays” or “I’ll be away for two weeks. I’ll focus on it when I get back”.
Your pipeline is dwindling. You haven’t booked a new deal in weeks. The ones you brought in are sitting on your underwriter’s desk, waiting to be reviewed, but they can’t move forward because there’s an issue with the bank statements. You’re kind of demoralized. The phone isn’t ringing and when it does, you can’t close anyone because they’re not ready to commit. Rates are too high for their loan to make sense or they’re heading to the airport with their family for vacation.
What’s a common mistake many loan officers make? They do less and ask for more. That’s right – they need to make more on each deal because there are less deals in the pipeline, but they don’t offer any additional service that makes the additional charge worthwhile for the borrower. Borrowers feel squeezed, which hurts your referral network. So next time the market slows down, here is what you should do.
1. Focus on the deals in house
Go through your pipeline. You have three deals in house, and none of them are approved. There’s your money, sitting there on the underwriter’s desk. The sooner the loan gets approved and closed, the sooner you get paid. Problem with bank statements? Set aside time to sit down with your underwriter and understand what the issue is. Large deposit? Get on the phone with your borrower and ask if they can source it. Sure, when it’s busy, you don’t have time for this. But it’s not busy. And you have time for this.
Same thing with the loan where the appraisal wasn’t done yet. Why not? Because the borrower isn’t calling the appraiser back. They’ve heard rates have gone up and it doesn’t make sense for them to refinance any more. So you get on the phone with them and show them the difference in payment. It’s only $17 a month and they’re still saving over $300. After talking to you, they understand the loan is still worth it, and they contact the appraiser to set up an appointment. Another loan, back on track.
You pick up another file that’s been “in suspense” because of an outstanding tax lien. It’s $84,000 worth of debt your borrower didn’t disclose and it’s keeping the loan from being approved. You call the borrower and ask him about it; he tells you it was paid years ago. With a little encouragement, he finds the paperwork that proves it was paid. He submits it and soon, the loan is approved. Yes, it feels like you’re selling the loan all over again, but you have time to step in and get involved. In a slow market, saving a deal is just as important as bringing in a new one.
2.Give it away
That’s right – give your time and your knowledge away without expecting anything in return. Hold a seminar. Give a talk. Offer to speak at the next dinner for area CPAs or financial planners. You have the time now that things have slowed. Give a talk on the latest trends in mortgage lending and you will derive benefits down the road. Just make sure to show up with lots of business cards.
That holds true for work colleagues too. There are probably junior sales people at your firm who have questions about certain programs or scenarios. Help them out with the knowledge you’ve gained. It will keep your knowledge fresh and maybe even give you a new perspective.
Sometimes, giving something away for free ends up paying you back in ways you can’t anticipate.
The last tip to avoid making a mistake in a slow market is education.
3. Learn Something New
In a slow market, it’s hard not to get down. The day drags, and you have no new loans on the horizon. How do you manage to keep your energy level high? Answer is: learn something new. Do you know every mortgage program out there? Probably not. Now is the time to read the product guidelines or take the webinar. Time to learn about how to use a reverse mortgage for a purchase or the new fix and flip loans that offer 90% financing. Why spend your time learning about products? Normally you only read guidelines if you have a specific deal you need to place.
Here’s why you should spend the time. First, you’ve got the time, and second, by learning something new, you’re challenging yourself, which makes the day go faster and keeps your mind engaged. Plus, there will be a time when it’s busy again and you’ll be on the phone with a borrower who needs this program. Instead of trying to learn about it while you’re trying to close them, you can draw on this knowledge and have it in your arsenal. You might even do some marketing to borrowers who could benefit from this program, thereby drumming up business that didn’t exist before. Learning and staying on top of information in your industry is always a good idea.
Key Takeaways
Maintain a balanced budget to sustain operations during market downturns.
Stay proactive with consistent follow-ups and engagement strategies.
Adjust campaigns to align with market conditions and client needs.
Commonly Asked Questions
- What is a common mistake loan officers make in a slow market?
Cutting back on marketing efforts, which reduces visibility and leads during challenging times.
- Why is neglecting existing clients a problem?
Ignoring past clients means missing opportunities for referrals and repeat business.
- How can failing to innovate hurt a business in a slow market?
Sticking to outdated practices prevents adapting to new client demands and market shifts.
- What is a smart strategy to avoid stagnation?
Focus on building relationships and leveraging technology to stay competitive and visible.
Avoid These Common Loan Officer Mistakes w/BNTouch
