Category Archives: home values

New Zillow Product Targeting Mortgage Professionals

The mortgage lead generation market is a notoriously crowded and certainly not as strong as in past years. This is punctuated in recent Experian reports:

The share of U.S. subprime mortgages entering default in the first quarter was the highest in almost five years, according to the U.S. Mortgage Bankers Association, as the country had its biggest house-price decline since the 1930s.

“The hit from the subprime mortgage market in the U.S. is quite worrying,” Seymour Pierce’s Lapwood said.

And IAC/InterActive reports:

LendingTree revenue fell 41 percent to $63 million because of the deteriorating mortgage market and a decline in real- estate values, IAC said. The unit posted an operating loss of $5.6 million and will have a loss in the fourth quarter, the company said.

“It will be a very steep mountain to climb to get back to any growth” at LendingTree, IAC Chief Financial Officer Tom McInerney said on a conference call with analysts and investors.

However, despite the gloom in the market Zillow appears to be headed headlong into this choppy water according to its brief teaser, "A New Opportunity for Mortgage Professionals," on the Zillow Blog.

Zillow’s announcement also seems to have a job opportunity attached to it. This has brought out a couple of bloggers that have put forward their best proposal (or rather a quest for good ideas) and opened discussion on what the "new opportunity" should be to interest mortgage professionals.

I won’t go into my thoughts on the topic here since you can read what I think is important to Zillow’s success in my comment to Morgan Brown’s excellent analysis. However, it sounds like you certainly should if you have ideas or are interested in the job since Drew Meyers and Zillow are paying attention and taking notes!

Seems like the right way to build a company, loyal and fanatical clients, and great products–IMHO.

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ARM Reset Hangover, Opportunity or Doom?

Paul Knag points out some ominous forward affects of the consumer ARM inventory.

Opportunity: If you think investors are prepared open up or get creative in future mortgage products to work-out payment shocked clients. Or, some magical nationwide, rapid property value appreciation.

Doom: If you think investors will still maintain tight loan amount and equity guidelines. And, no magical economic indicators to support nationwide, rapid property value appreciation.

Consumers: It is time to find ways to rapidly increase your income or reduce non-mortgage debt!

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Top 10 Ways to Survive Mortgage Implosion

The speedy and dramatic implosion of American Home Mortgage has sent many mortgage professionals into a accelerated search for a defensive strategy. Here are a few suggestions for survival to make sure you are not the next implosion or left in the collateral damage of the next big one to fold:

  • Winners are Good Climbers: I still believe this advice I gave back in November 2005 as this market began to change
  • Market winners are good climbers. If you look at endurance sport champions you see “good climbers,” runners and cyclist (i.e., Lance Armstrong) that know how to get very efficient and maintain form throughout sustained ascents. This translates into gain ground on leaders or extending distance on followers in the race.

    Business is no different. If you know how to quickly get more efficient and maintain form (customer experience) in harder markets you will gain market share. This is what Kaleidico is doing for our clients showing them how to get more efficient and effective in Internet channels, while maintaining their form.

  • Control Your Production: You have to evaluate your productions and production pipeline every day versus the market and your investors. If you don’t have a master risk plan for the organization you can be left running or using a lot of resources looking for a home for that high LTV, poor credit, stretch unit your LO brought in.
  • Train or Retrain a Client Focused Salesforce: It is now a clients’ market. Treat them like they are important. Focus on each one with empathy, intensity, and respect. Enforce this dogmatically in your organization.
  • Letting Past Clients Know You are Here: Time to get out real paper and your favorite pen. Drop a note to 5-10 of your past clients each week until you cover them all. Let them know you are still here and ready to answer their questions or meet their need. Start an email newsletter and let your clients know what is going on and how to evaluate what your clients are reading in the news.
  • Mastering New Market Channels: Web 2.0 is in full swing and clients are using these tools. Learn what a blog, Facebook, LinkedIN, Twitter, etc. are and how to leverage them in your business.
  • Build and Expand Your Internet Presence: A Web presence is much bigger than a static Web page. Learn to increase your footprint on the Web with a combination of PR, lead buying, Web 2.0, and your own lead generation.
  • Learn to Buy and Work Internet Leads: This is where consumers are going to investigate their options and opportunities. You have to be a presence here. In addition, this is one of the few channels where you can match your marketing to you specific product and production strategy–critical factor in the volatile correction period. Every lead is even more valuable in this market, don’t forget a strong lead management strategy!
  • Create Agility in Your Organization: Make sure you have a plan to quickly inform and have your whole organization respond and react to the market. This means a tactical plan for quickly adjusting to changing rates, products, and investors. Make rapid shift simple and understandable to your clients.
  • Create an Effective Risk Management: If you don’t have someone responsible for risk management. That person should be watching and evaluating markets, pipelines, and investors daily. Then building a daily plan to respond and create opportunity
  • Finally, Become the Best: This is a great time to take market share by becoming the best or innovating a better way.

Remember, Winners are Good Climbers!

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Check the Market and Update Your Playbook

This is a short good habit building reminder:

Check your market (short and long-term):

Check mortgage product trends:

  • Unfortunately, I haven’t found an easy, free, way to do this so you will have to start your own ticker
  • My initial suggestion…track the home pages and public statements of the big boys: Countrywide (who recently reported they are canning their pay-option products), Quicken Loans (who’s SecureAdvantage, a pay-option product, just vanished from the face of all advertising), that right their should give you all a full months production saving these clients from neg-am mayhem
  • If you are buying Internet leads chances are these are the clients you are getting and the players with which you are competing–so know the current and past product mix
  • If anyone else finds a good resource for doing this–let us know with a comment

Update your playbook:

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Real Estate Valuation Going to the Consumer

This realtor/real estate broker/property valuation slug-out will increasingly tip the leverage to the mortgage banker as the first trusted advisor in any real estate purchase–if you are capturing consumers off the Internet.

Is your mortgage operation prepared to:

Doubling Your Production with Complimentary Customer Analysis

I have talked often about building a client loyalty program that not only keeps you top of mind with past clients, but also provides ongoing value to the client.

Here is a powerful set of Khai McBride, of Charter Funding, presentations compiled by Dave Savage, The Mortgage Coach.

It is certainly worth 30 min of your day to watch, but it won’t double your production unless you get off your butt, build, and execute the idea.

Know Your Market, Know Your Products

I don’t think anyone disputes that we are now in a different mortgage market. So, what is the plan?

In the re-finance heyday markets and products were moot. Everyone was in the wrong product for a rate tumbling market and any product that had adjustable in the name left the borrower better than they were before. The consequence was that everyone with a telephone became a mortgage “professional” and the true professionals got lazy. So, stop crying in your Cheerios and get back to being a professional–do the hard work for your clients and yourself.

Get local and start educating yourself:

You will be surprised when you do this research and what mortgage products may work for your market. You might also decide to conquer a particular niche mortgage customer and be the expert provider of that mortgage niche.