BLOG VIEW: The housing market currently faces unprecedented challenges and a constant sense of uncertainty. Originations are at or near the lowest point in 30 years, interest rates have reached their highest levels in over two decades, home affordability is at an all-time low, and home prices have soared to record highs. All these factors have placed tremendous pressure on mortgage lenders to find ways to help their sales teams thrive and replace lost production. After all, standing on the sideline is a recipe for disaster.
To survive and thrive during these challenging times, lenders need to not only motivate and inspire their sales teams, they must determine the necessary steps to keep production moving forward, and provide the framework and resources needed for their teams to succeed.
What follows are five essential principles which I call the “Five to Thrive in a Challenging Market.” These five principles are vital in any market, but in today’s housing market, a lender cannot get away with avoiding any one of them.
Exceptional Leadership
During challenging times, it’s crucial for lenders to maintain positive energy, dialogue, and focus. But it’s also important for leadership’s message to be based on reality.
Even in the most difficult of times, there are ways to carve out potential opportunities by understanding what the masses are doing and making strategic moves that set a team apart. The message should highlight the small advantages that can inspire the team to realize that they are not like everyone else – that they have unique advantages that are valuable no matter what is happening in the market.
Defined Success Strategy
In a difficult housing environment, the desire to develop relationships and target referral partners is not enough. It requires a well-defined strategy.
I speak with many loan officers who want to build more relationships with attorneys, real estate agents, accountants, or financial planners. When I ask them how they plan to do that, they’ll say “Well, I’m going to talk to more of them.”
But that in and of itself is not an actual strategy. A strategy is specifying the actions one will take to build these relationships, such as sending emails, making phone calls, attending networking events, and leveraging social media. Basically, a strategy should encompass all the pieces that will contribute to one’s success.
Specific Tactics
While creating a strategy to reach a target audience is important, it’s likely that many of a lender’s competitors have similar strategies. To truly stand out in a crowded marketplace, one needs to understand one’s messaging, or risk sounding like everyone else.
This is where clarifying one’s competitive advantage comes into play. A lender’s message is its most powerful tool, because it’s what differentiates the lender from the competition. Messaging is one of those areas where very few lenders get as granular as they need to; they do not practice it enough. But if a lender doesn’t have its message built around its unique advantage, it won’t be able to effectively communicate it to its audience.
Clarifying the Competitive Advantage
Almost every mortgage company has the same set of products, but every lender and loan officer is exceptional in some way. The key to articulating one’s competitive advantage is not based upon product. It’s how one communicates to one’s audience—be it borrowers or referral partners.
There is no silver bullet strategy that is going to suddenly inspire people to buy a home or refinance their mortgages. But there are ways to tailor a message so customers realize how a lender can help them achieve their goals.
For example, a lot of salespeople use numbers to demonstrate the benefits of buying now versus buying later. But most people aren’t swayed by numbers—they’re swayed by emotions. Many people put off buying a home during the pandemic because they were turned off by bidding wars.
If a lender knows someone who stayed on the sidelines, they should try asking that potential borrower how they feel about that decision now, given that they missed an opportunity build home equity.
By tying in both logic and connecting with customers’ emotions, lenders can compel people to get off the fence and take action toward achieving their goals, which can lead to more successful deals.
Training, Execution, and Reinforcement
During tough times, leaders are involved in many different areas of the business. So, when they hold a sales meeting, most are just looking to give their team a motivational boost.
But this is not enough. If one really wants to move the dial, one needs to provide training that not only teaches one’s sales team what to do and how to do it, but also reinforces these lessons through repetition and accountability.
This is crucial because not everyone on a team has the same skills and experience. To create lasting change, a team must practice and demonstrate their understanding of the strategies. Of course, in a difficult market, many companies don’t have the resources to devote to training. However, there are ways to outsource training that incorporates execution and reinforcement and delivers the desired results without shattering the budget.
Collectively, these five principles can empower teams to navigate challenging market conditions and continue to thrive. However, implementing them takes dedication, time, and often a renewed commitment to training and support. None of this is easy. But embracing these principles now, when the market is difficult, is only going to reap bigger returns down the road.
Ron Vaimberg is a well-known trainer and coach of mortgage sales professionals. A former top-producing loan originator and real estate agent, he has coached loan officers and brokers who have ranked in the top 1% in loan production and earned over $1 million annually.