Monthly Archives: August 2007

Big Things to Come from Mortgage Adversity

Harvey Mackay reminds us that the best education comes from adversity. He cites many notable people who have pushed through grand adversity to reach notability and significant achievement. One of my favorite historical figures and notable repeat early failure, Abraham Lincoln, gives us the secret to creating big things from adversity:

“My great concern is not whether you have failed but whether you are content with your failure.”

Our news feeds and blogs are full of adversity for the mortgage industry: grand implosions, significant bailouts, and massive lay-offs. However, the good news for the initiated out there is that this is the time for Big Things!

Here is my short list of things I think will change (read: opportunities):

There are many more and most I can’t even conceive from my perspective. These are interesting times–Big Things will come from this doom and gloom!

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Surviving the Mortgage Implosion Presentation

I am polishing up my presentation for the TargusInfo Online Lead Quality Summit and I nearly forgot my most valuable resource in preparing my thoughts–My Readers!

The topic: Surviving the Mortgage (Subprime) Implosion

The teaser: “Online lead generators and buyers in the mortgage space learn how to overcome the challenges of generating quality leads in today’s existing mortgage marketplace.”

So, here are my questions to you:

  • If you were in the audience what would you want to hear about?
  • If you were giving the presentation what would you talk about?
  • What are your biggest fears in this market?
  • What do you see as the biggest opportunities?
  • What are you doing to survive?

Here are a few things I have already written about the mortgage implosion.

I would love to hear your thoughts. Comment below or directly to me at:
bill.rice [at]

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10 Ways to Improve the Performance of your Sales Pipeline

In sales we are constantly driven by performance and making our numbers. Unfortunately, this can lead to hoarding leads and over packing our pipeline with potential opportunities–disadvantaging our real opportunities and overall sales pipeline performance.

Here are a few of the techniques I use to pack a tight and productive pipeline:

  1. Keep it clean
  2. To me, a clean pipeline means one that is well attended and accurately documented. Develop a methodology for annotating key actions or tagging each lead as you work it. These annotations function as milestones and statuses that segment your prospects. This segmentation becomes key to observing and acting on leading indicators to convert more prospects into sales.

  3. Keep it tight
  4. Kill the temptation to hoard stubborn prospects. Cut 10% of your leads each day from your pipeline. I suggest withdrawing them from the active pipeline and feeding them back in systematically in about 30 days for a courteous follow-up. Which do you cut? Analyzing your actions or tag data should over time tell you at what point a lead begins to become unproductive, but here are a couple of starter suggestions for Internet leads: leads over 15 days from inquiry, leads attempted and not contacted more than 5 times, leads contacted and not applied more than 5 times.

  5. Give every note/lead a next step
  6. Most of us are managing a pipeline of 100-150 prospects. Unless you are superhuman, or already have a good action/status methodology, it is impossible to know were you are and more importantly where you are going on any one lead. Quick fix: add it to every note. Where am I going on the next call? This becomes your mini-tactical sales plan. Place the answer to the question on every action, even if you don’t make contact.

  7. Put a memorable reference in every note
  8. This little trick will turn high volume sales into high volume relationships. Did Susan say she needed to hop of the call because she need to run Bobby to his baseball game? Note it. And on the next call ask Susan how Bobby’s game was. These are the little touches that make customers.

  9. Give every call an objective
  10. Before you dial know what you want the result to be. And don’t make it so broad as close the deal. Maybe, it should be something like when does their ARM reset? Do they have a steady, documentable income stream? Get to a credit pull.

  11. Look for leading indicators
  12. This is where your action/status methodology becomes critical to seeing patterns that indicate pending conversion. Use time, frequency, and status to triangulate successful sales patterns. Turn those patterns into best practices and leading indicators for projections and sales techniques.

  13. Optimize your call back periods
  14. Call back periods are another key link to your action methods and leading indicators. Set your call backs to trigger off of your leading indicators to ensure each call is advancing the prospect forward into a sale.

  15. Build a rhythm
  16. stockxpertcom_id2721261_size2.jpg

    Create a sales day or habits that have rhythm. Good runners have rhythm and can generally set their watch by their pace. It is not full of surges, but rather a steady cadence. Set your sales day like that: start early, review the market, review your product matrices, envision the top 5 borrower scenarios you will encounter today, build those presentations, get your scenarios and calculator at the ready, clear your desk, start dialing, keep a separate running sheet of objectives, pause at lunch time for adjustments to your scenarios and strategies based on the objections you heard, close the day strong.

  17. Throw out your dialer
  18. Dialers are for robotic, cold calling, fishing expeditions or surveys. Dialers frustrate prospects and your sales numbers. Enough said.

  19. Pick up the phone
  20. This is number 10 because it is the most important. Get started! You have to pick-up the phone and make the call. Overcome the fear to engage.

If you set a rhythm, tighten, action, and call your pipeline–it will produce more for you!

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Could Credit Crunch Accelerate Borrower ARM Refinancing?

What does the mortgage credit crunch have to do with mortgage borrower behavior? A lot! Well, maybe not as much the actual credit crunch as the hype and exuberance that it has generated.

Most borrowers have no idea what a credit crunch is or why mortgage companies are imploding, but they do know there is panic and mayhem in the mortgage market.

Consumer reaction: Mortgage? I have a mortgage. I heard rates are going up. People are losing their homes in record numbers. The stock market is going crazy because of mortgages. Oh no! I have and adjustable rate and it is going to go up. My payment will go up. I won’t be able to pay it. I will lose my home! PANIC!

Now marry that reaction with Bernanke’s statement and ARM reset data from Paul Knag’s post about another topic–the Folly of Mortgage Lead Generation–and you have an opportunity building for smart mortgage businesses:

“Bernanke told Congress last month that the housing swoon ‘will likely continue to weigh on economic growth over coming quarters, although the magnitude of the drag on growth should diminish over time.'”

But it will take longer than you might think for that negative influence to decrease. Let’s take a look at the following table. This shows the amount of adjustable rate mortgages that reset each month for the first half of this year and will reset for the next 18 months. Note that these reset numbers are a driving factor in the increasing rise in foreclosures. Pay attention to the numbers I highlight in red for January through June of 2008. The largest portion of mortgage resets is not until next year.

Are you talking to these consumers? Are you the calming voice? Are you genuinely trying to help them?

You want a survival, maybe even a growth strategy? Do this today.

  • Search your loan files pull out all of these short-term ARMs
  • Send a note, make it personal if possible, and give a brief (Real people English only) explanation of what is going on
  • Use calm, not alarm
  • Tell them you will review their financial situation and options for free
  • Tell them they may need to do nothing, but they should check
  • Follow-up with a call
  • Tune all of you marketing and Web to explaining the market in calm consumer language
  • Offer advice and consultation, not loans

Help your clients and it will grow your business!

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Your Competitive Advantage is measured in Inches

When I was at Quicken Loans one of my favorite of the ISMs, which made up our corporate DNA, was “The inches we need are everywhere around us.”

So, it struck me today when Seth Godin, another really successful guy reveals the same conclusion about making clients fanatical about your company and product in his post on follow through:

If you know that the last two inches of your follow through don’t matter, then you’ll start slowing down at three inches, or even four, and suddenly it does matter. If you draw the line on money back guarantees you’ll keep sliding backwards, bit by bit, until it does matter. If you’re quick to fire the employee who needs a lot of help, you’ll be quicker with those that need just a little, and then, pretty soon, it’s a very different place to work, isn’t it?

Obsessing about the last inch of follow through ensures that the important parts of what you do get just as much (if not more) commitment.

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Careful Not to Poison Lead Generation

Lead Critic highlights an interesting test conducted on LowerMyBills by Consumer Reports.


From the journalist reported experience you can understand the experience the consumer expected to have versus what he got:

A Consumer Reports’ tester filled out a form as though he was shopping for a mortgage. Within an hour lenders started calling him. He was swamped with calls at all hours of the day and night, even on weekends.

consumer_reports.gifAnd Consumer Reports says when it comes to too-good-to-be-true mortgages, the real deal is often quite different. For example, an ad that promises a $510,000 mortgage for under $1,498 a month. If you look at the fine print, you see that if you pay just $1,498 a month you’d never pay off the loan because you’re only paying about half the interest and none of the principal. To actually pay it off in 30 years, you’d have to pay about $3,200 a month.

Consumer Reports says there are better options at two other Web sites– and They list potential lenders and let you choose which one to contact. That means greater control for you and fewer hassles.

I agree with Lead Critic that the, quickly growing old, method of slapping up a distracting flash banner, grabbing a name and phone number, and setting up no expectation with the consumer is a recipe for consumer disgust. And made bad enough, will reverse the trend of consumers coming to the Web first for products and services.

So, if the lead generators won’t change their ways what can lenders do? I think the formula is simple:

  1. Make sure you are immediate to reply
  2. You fill the expectation gap

Filling the gap means telling them they will get other calls, set your trap doors for the late comers, and advise them to beware of credit triggers.

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Could Mortgage Market Have Contagion Effect on Politics?

This is kind of interesting if you think about it: “Mitt Romney’s [portfolio (hedge-fund)] Hit by Mortgage Meltdown”

Walk with me for a moment:

Many of our politicians are very wealthy men and women. As a result, they are often invested in potentially higher-yield, higher-risk investment vehicles–like hedge funds.

If you are not familiar with the nuances of hedge funds I highly recommend Marc Andresseen’s series on “fun with hedge funds.”

Hedge funds are often riding the speculative big waves, like the mortgage market. And like most institutional investors it is hard to get out quick to stop the bleeding.
So, many of these politicians/legislators lost or are losing significant amounts of money.

Meanwhile, they are also entrusted with legislating solutions or even bailing out the current market woes.

Is it for them or for the lenders and borrowers? Seems they are late to that game, but they can steady the mortgage market. Again, for them or the market?

Don’t get me wrong. I am a big free markets guy and believe they generally appropriately correct over time, but sometimes you have to wonder what really motivates action.

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