Four Ways to Wow a Lender’s Business Referral Partners in the New Year


BLOG VIEW: The lenders who are still in the business today are those most likely to make a run of it in 2023. Those who wanted to sell are already well down that path. It’s now up to those remaining to determine who will win market share next year and who will not.

New financial data suggests that the downturn may not be as severe as initially believed, meaning that even those lenders who don’t gain market share in the new year should be thrilled to keep what share they have.

Growth in 2023 will require different tactics than those that worked during the past refinance waves. We have shifted into a purchase money business. Even if interest rates reverse their course, it will take time before a critical mass of current borrowers could benefit financially from a refinance. In this market, growth comes through critically important partnerships with business referral partners. 

Today, and for the past six months, real estate agents who haven’t heard from a loan officer in years are getting a lot of attention.

Cutting through this noise will require the LO to provide something more than other competitors. Here are four ways loan originators can WOW their business referral partners now and set themselves up for success in 2023.

Make it a Habit to Over-Communicate

High up on the list of the mortgage transaction annoyances is the confusion that comes from not knowing where the lender is in the origination process.

One of the complaints nearly every lender heard was that their partners were suffering from a lack of communication during the refi boom. There is no excuse for this today.

With loan volumes down and excess capacity in most lender shops, this is the perfect time to form some new habits. Leaders will train everyone to keep every partner, whether they be real estate agents, lawyers or financial advisors, fully abreast of what’s going on in a transaction. 

Modern loan origination technology has made it very easy to provide status updates to any stakeholder at any time during the process. Proactive communication to referral partners is now a foundational element that all leaders will automatically offer in 2023.

The Referral Partner is Always Right

Over the past few years, the mortgage industry has come to grips with its responsibility to create meaningful and satisfying borrower experiences. Now, it’s time to realize that the referral partner is just as important, or even more important, than the borrower. 

It will always be important that we offer our borrowers the best possible experience. It’s how we’ll win future business in the form of a new loan from the borrower or a referral to someone they know. But these wins are dwarfed by the business building power of the referral partner.

Our borrowers, about 70% of the time, represent a single transaction for most loan officers. A good referral partner could bring in many transactions each month. To win them, we need to look beyond the transaction to the lifetime value of that relationship. 

Because few LOs have been doing this, originators who treat business referral partners like the valuable assets they are, will undeniably set themselves apart.

Tune Up Your Tech Stack

Legacy mortgage software doesn’t excel in meeting the needs of business referral partners, especially when it comes to effective communication. Lenders who take the time to tune their tech stacks now will be more effective at meeting their partners’ needs next year.

Of course, this assumes that it’s possible for lenders to make changes to their tech stacks. Lenders with older platforms are finding that developing new workflows is time consuming and expensive and they are often driven to their LOS developer’s preferred partners.

Modern LOS software offers a robust set of APIs that lenders can leverage to create exactly what they need to process loans efficiently, communicate effectively and close faster. In addition, these next generation tools have gone beyond the desktop and are now available on mobile devices, allowing LOs to communicate with their partners from anywhere.

Real estate agents and other partners are already experiencing this API-driven efficiency in other parts of their businesses and so it is fast becoming a requirement for all lenders. Using an older tech stack just because LOs are familiar with it will be a mistake in 2023.

Broaden Your Loan Menu

In the past, speed to close probably would have appeared on this list. At the peak of the housing market, being able to close on a loan quickly was often the difference between having the winning bid or missing out. But today, in a cooling market with fewer buyers competing for the same homes, it’s really about qualifying more borrowers.

For most lenders, this will mean offering a wider range of loan products that will meet the needs of the most potential home buyers. You can’t build a strong relationship by telling your referral partners that you can’t finance their buyers. At the very least, setting sound expectations for the agent’s clients will improve the experience for both the agent and their buyer.

When the lender does qualify a new home buyer, the agent is likely to want to see a pre-approval, not just a pre-qualification. By telling your partner that a deal will work as long as title and appraisal work, both of which are the seller’s responsibilities, the lender provides the kind of clarity that builds trust.

In the past, it was difficult for lenders to deliver the type of experiences that are possible today because their capacity could barely keep up with demand for loan products. There is no excuse for lenders not to deliver on these promises now.

It will require lenders to consider the ways they can offer a better experience to their business referral partners and the home buyers they serve. It should all be part of a good business development strategy that will drive LO actions in the year ahead.

Lenders who emerge as industry leaders next year will also be bold in their approach to equipping their LOs with better technologies that can make it easier for them to WOW their business referral partners. 

Joe Camerieri is executive vice president of sales and strategy at Mortgage Cadence.

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