by Tim O’Leary, Senior Loan Officer, NMLS #316266
Watch this episode on RMXP TV at http://rmxp.co/1f3vzP
By setting standards in your business you can easily increase your lead conversion. My own lead conversion grew from 50% to 90% by setting, and more importantly sticking with, business standards.
Imagine a business without standards: Hawaiian Airlines is known to have the best ‘on-time’ record in the industry. That’s clearly a standard, an intention. Do you think there are variables in running a plane, or for that matter a fleet of planes ‘on schedule’? You bet! Imagine if Hawaiian Airlines had no real set departure times for their flights and would leave when everyone was on board. They wouldn’t likely be punctual or profitable would they? What about your Dentist? Are you able to just show up to get a Root Canal? No, there are procedures that need to take place prior. There are ‘standards’. You get the picture.
As you ponder and consider creating your standards for your business, let’s discuss one that may help you in working with Buyers.
Personally, one of my standards is, “All First Time Home Buyers meet face-to-face with me.” I developed this standard because I analyzed my business and determined that my conversion ratio on First Time Home Buyers was at approximately 50%! I then experimented and started doing all meetings in person and created a presentation that walks each Buyer through the entire process. These meetings went from 45 minutes to 1 hour and 15 minutes, but at the same time my conversion ratio went from 50% to 90%. That small adjustment and time investment had a profound effect on my business.
The Pre-Approval Process – Make it a standard
Why Is It So Important?
1) It protects your time and insures that you’re working with someone that’s qualified. If they’re not qualified now, you shouldn’t be working with them yet.
2) Sometimes clients don’t want their Realtor knowing all of the gory details, i.e. divorce, bankruptcy, etc.
3) Consider that these new clients don’t know how you work and are unaware of your ‘standards’. If one of your standards is that “all clients are Pre-Qualified by a Lender” and you present it in a very professional and confident manner, they will do what you say. Remember, they don’t know you yet!
4) Now, there are the rare occasions, when you have those Buyers that you just ‘feel in your bones’ that you don’t need to pre-screen. Go ahead, take a chance. However, 9 out of 10 Buyers should be pre-qualified if they want to work with you.
Here’s a script that you can use as a Realtor when working with a Buyer:
“I’m going to ask my lender (Tim O’Leary) to call you as soon as possible and discuss with you all the financing options available. This should answer all of your questions, as well as give you the confidence you’ll want in purchasing a home today. Can I have him call you in the next several hours?”
When we work with confidence, we perform our best. Do the right thing and have your Buyers pre-approved by a Lender, it’s in your best interest and your clients.
What is Involved with a Pre-Approval?
1) Phone meetings take 20-30 minutes, and an in person meeting takes 45 minutes to an hour. However, as I mentioned earlier, I meet with all my First Time Home Buyers face-to-face.
2) Clients provide 2 years Tax Returns, W2s, Business Tax Returns if applicable, 2 most recent pay stubs, 2 months bank statements, most recent mortgage statements for other properties.
3) Additionally, an experienced Loan Officer will ask questions beyond the obvious. Think of it as ‘peeling back an onion.’ Layer by layer we find out their motivation for buying property, what it means to them, and what it means if they don’t buy a property. Like you, we want to build rapport and get to their needs, you get the answers by asking the right questions.
When we invest the time upfront with clients, we can address all issues before it becomes a transactional issue. By taking care of business upfront, we create confidence and allow for an enjoyable and pleasant transaction.
Now, over the next few days, think about what standards you can put in place. By doing so, you will transcend your business to new levels. It’s all possible and it’s all up to you!