Your Frequently Asked Questions Answered (Part 2)

Recently I asked the members of our Loan Officer Breakfast Club this question: what’s your biggest concern? I addressed a handful of them in my last post (if you missed Part 1, click here), but there were some more good ones I wanted to be sure to answer.

Let’s dive right in.

“My Rates Are So High—What Do I Do?”

This loan officer went on to say, “It makes more sense for people to wait to buy. This economic situation sucks.”

I don’t know who asked this question, but my suspicion is that it’s someone who’s newer to the business. I’ve been doing this for a long time, so I’ve seen this type of situation over and over and over. It’s cyclical. It always has been, always will be. 

First of all, rates really aren’t that high (6% to 7% as I write). When the lovely Mrs. White and I bought our first home, our interest rate was 16%. We had a VA loan, excellent credit, and excellent debt-to-income ratio. I remember when rates went down to 10%, I told her that if we were going to buy a big house, we needed to do it right then because rates would never be that low again. Then, lo and behold, they went down to less than 3% a year and a half ago.

They got really low, which is why it feels like they went so high. But if we look back historically, it’s not that high. Just like with gas prices. A few years ago, gas was $1.60/gallon in my city. Last year it went up to $5/gallon. For a while, people said, “Oh, I’m not going to drive very far” or “I’m going to carpool.” After about 90 days, people tend to forget and get back to business as usual.

We went to the grocery store the other night and bought chicken. It was double what we used to pay. We still bought the chicken. We still buy apples. We still buy salads. Inflation is high, and prices are going up, but we’re still buying the things we want and need, right? 

Yes, rates are high compared to last year, but they’re not high compared to 30 years ago. We have to do a reset in our mind and sell what’s on the shelf. My branch closes hundreds of loans each and every month, and we’ve got the same rates everybody else does. We’re not the highest or the lowest. Why would we tell people to wait for rates to go down? What if they don’t? What if they go up? You can’t just sit around and wait, hoping interest rates will go down. They might not. Houses almost always go up in price. Sell what’s on the shelf.

Owning your own home is a pretty sweet deal. I was really proud of myself the first time I bought a house. I would never want to rob someone of that experience by having them wait out the interest rates. We can’t sit around and wait for the perfect storm to hit again, where inflation is low and interest rates are low. It had never happened before in my lifetime, and it may never happen again. Sell what’s on the shelf, and everything else kind of falls into place. 

I bought five houses over a period of 12 months in 2004-2005, right before the housing crash. For a little while I was upside-down. I paid $300k for each of them and, two years later, they were worth about $150k each. But I didn’t sell them. I kept them, paid them off, and now those houses are all worth between $500k and $600k. 

As time passed, my $300k investment turned into $600k, and $600k times five is $3 million. I’ve also been collecting rent all these years. So I’m really glad I bought those houses back in the day. Now, if I would have bought them when they were $150k, I’d have made even more money, but there’s no way I could have known they were going to go down in price. We never know the high point or the low point until it’s history, right? It’s hard to time the market like that. It almost never works out. 

Sell what’s on the shelf.

How Do I Get People to Send Docs in a Timely Manner?

If you’re a loan officer who’s concerned about people sending docs in a timely manner, then you’re way too involved in your files. That should be an issue that an excellent clerk in your office is doing for you. While that person is working on the docs, you’re out prospecting, getting the next three, four, five loans coming in. 

If you make $3000 per loan, then that clerk can gather all those docs while you’re spending your time getting 5 loans and $15k. Let’s say you pay that clerk $4k/month. Subtract their salary and you just pocketed an extra $11k a month. And you didn’t have to think about a single document.

Now, we do use a script to help us get docs on time. It goes something like this: “Hi, Jamie. I see we’re closing on the 15th. I’m going to give you a list of items we need to make sure we can close on time. If you could look at this list really quickly, Jamie, while we’re on the phone, is there anything on this list that I can’t have by Wednesday at noon? Because, if it’s after Wednesday at noon, I’ll need to call the realtors to reschedule the closing for further down the road. If you can get all of those to me by Wednesday at noon, we’ll be good to go. Are we on the same page?”

This is just a really cool way to tell them, if you don’t have the docs, no problem. You’ll just need to call the realtors to push the closing date back. If they don’t want that, since they’re so excited to move into their new home, then they’ll have the docs to you when you tell them you need them. You’re setting clear expectations. And, as the loan officer, you’re having someone else handle this part for you, because you’re already out prospecting the next loans.

In our mortgage branch, all of our loan officers have an assistant. If you have a loan officer closing just four loans a month, two loan officers can share one assistant. But the assistant is the one in charge of collecting the docs. That way we free up the loan officer to do more prospecting.

How Can I Adjust My Mindset to Rise Above the Winter Slowdown?

Depending on where you live, yes, the winter slowdown is real. But here in Florida we operate 12 months out of the year. In the summertime, we’re really busy with the locals buying houses. And in the winter months, we’ve got snowbirds coming from up north to spend the winter. So we get two big boosts each year.

Most of us have the ability to be licensed in more than one state. I’ve got a branch in Wisconsin and not as many people buy houses in the winter there. If you’re in Ohio and you get snowed in and things slow down, you can do two things: prospect more or get licensed in a warmer state. If I lived in Wisconsin, New Jersey, Pennsylvania—anywhere north of the Mason-Dixon line—I would get licensed in another warmer state. Florida’s a good one—or Texas, Arizona, New Mexico, California.

I have a friend who lives in Manhattan and he closes most of his loans in Florida. With Zoom meetings becoming the norm, and people doing business all over the world, it’s not a big deal to sell loans in a state where you don’t live. 

Prospect more so you’ve got a bigger pool to close from. And consider getting licensed in a warmer state and following our Daily Success Plan which you can do from anywhere.

How Do I Stick to My Plan and Not Allow Distractions?

In my experience, the biggest distraction is email. Turn the darn thing off. When we make our prospecting calls from 9-11 Monday through Thursday mornings, we turn everything off—email, notifications, all of it. There’s no way you can concentrate and get these calls done if you’re constantly being interrupted.

The next big distraction is your buddies in the office. If you’re trying to focus on your calls, and your buddy starts talking, “How about those Buccs? What are you doing this weekend?” you need to shut your door and put a sign on it. “Making phone calls. Do not disturb until after 11:05am.” Have a little whiteboard on your door or cubicle where people can leave a message. It’s a simple matter of respect. Be firm and clear about your boundaries and expectations so you can focus.

A lot of people need help with this. We do this really cool thing both in my branch and as part of the Mortgage Marketing Animals. We sign into a “MMA All Stars” Zoom call every Monday through Thursday. We all turn our cameras on and from 9:00-9:10 we talk about the calls we’re making today and run through some Mortgage Marketing Animals scripts. Then everyone mutes their mic but leaves their camera on. So we’ve got a hundred people making phone calls and we can see each other doing the work. 

It serves as encouragement and accountability both. I’m not going to get off the call and start playing on Facebook. Everyone can see me. If I get up out of my chair and I’m gone for longer than it takes to powder my nose, someone might say, “Hey, Carl. What happened? You left your desk.” 

And people are sharing wins in the chat too. “I booked an appointment!” Or “I just closed a loan!” That gets people excited, invigorated. We make it a game, challenge each other, even poke fun. 

You’re kind of drafting with each other, like geese flying in a V pattern. You’re doing your calls, working faster, getting more leads, more appointments, and closing more loans when you’re riding with a group. That’s just how it works. 

If you’d like more information or some help with who to call, what to say, and how to close more loans, we’d love to help. Click HERE to schedule your FREE strategy call today.