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   ARTICLE   |   From Scotsman Guide Residential Edition   |   December 2012

Don't Ride the Roller Coaster of Originations

Stabilize workflow and income with preparation and good customer service

Don't Ride the Roller Coaster of Originations

Most mortgage originators have heard colleagues complain about earning good commissions one month only to be followed by little to nothing the next, and this seems to repeat month after month. This roller-coaster cycle of loan origination is an all-too-common phenomenon. The primary cause is usually loan originators themselves and how they approach each application.

Even in the interest of appeasing customers, loan originators who cut corners, accommodate unprepared applicants or don’t set appropriate expectations from the start cause more problems in the long run. These types of originators may originate a respectable volume one month, but the following month, they’re likely to be putting out fires and resolving unnecessary problems that could have been avoided in the first place. They must spend time addressing these issues — time that otherwise could be spent originating new loans.

There is no question that customer service is critical to the mortgage- origination industry. Originators should be mindful of treating their customers respectfully and professionally. Doing so not only encourages them to refer others to you, but also to return to you. Simply accommodating customers might appease them initially, but they likely will feel differently after you must follow up the relatively easy application with seemingly endless solicitations for additional documentation.

The following are three simple steps to help you avoid an income roller coaster and accomplish higher levels of customer satisfaction while stabilizing your earnings.

1. Set expectations

Assuring your customers that you will have their appraisal in five days or that you will close their loan in 10 days may make them giddy at first. When the appraisal is not back on day five or they’re not sitting at the closing table on day 10, however, in their minds, something is terribly wrong. They might start questioning your competence. That’s why it’s critical to set realistic expectations from the start.

Telling them that you will have their appraisal in two weeks or that you’re going to lock in their interest rate for 75 days might not be what they want to hear, but when the appraisal arrives on day nine and when they’re headed to closing in three weeks, you’re a hero. Everything is perception. Telling them something that sounds great at first but ultimately fails to manifest is similar to quickly consuming sizeable quantities of carbohydrates. You feel energetic at first but crash shortly thereafter. It’s easier to recover from immediate disappointment than from disappointment following a prolonged period of expectation.

2. Get clients to prepare

Most mortgage applications are scheduled by appointment. Scheduling this is the loan originator’s first and most important opportunity to take control of and steer the transaction in the appropriate direction. Before concluding the scheduling, dictate a detailed list to your customers of everything that they should have with them at the application.

Resist requests to e-mail or fax the list, and insist that clients take a few moments to write everything down. Although seemingly clandestine, writing it down serves two important purposes. It’s easy for your e-mail to sit unread until the day of the application. Faxes can lie unread on a fax machine until hours before the application, as well. Then, when finally read, customers may discover that some or all of what you’ve requested is not easily collected.

When clients have no choice but to write down a checklist (specific to their particular circumstances), not only are they immediately aware of what is needed, they are engaged actively in the process. Additionally, if there is something that they need but they neither have it nor know how to collect it, you can explain how to get it or suggest viable alternatives. Not only will this reinforce your value to your customer, but it also will demonstrate your knowledge and competence.

Explain to customers how important it is that they have everything you’ve indicated is needed at application. Set the appropriate expectation by emphasizing how, if they come without the necessary documentation, you will have to reschedule the application. A tax professional wouldn’t prepare tax returns based on estimates, much in the same way that loan originators shouldn’t originate a mortgage with estimates.

3. Fully complete the app

Underwriters’ No. 1 complaint is incomplete and incorrectly completed applications. The application is the canvas upon which your masterpiece is created. Approaching it systematically, thoroughly and by correctly completing each field sets you well on your way to avoiding the fires that may otherwise interfere with originating additional volume. Never compromise the quality of your application. A small investment of extra effort in the beginning likely will save you hours of unnecessary work and customer inconvenience. If applications are not your strong point, you may want to consider pursuing training on completing effective applications.

•  •  •

By establishing the appropriate expectations, adequately preparing your clients for the application and holding them accountable, and by originating thoroughly and competently, you are setting the stage for smooth and easy closings. You also will benefit from happy customers who want to refer others to you, and you can spend your time consistently originating new loans, instead of putting out fires every other month. Don’t get stuck with wild swings in work and income — save the roller-coaster rides for amusement parks.


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