It’s that time of year again — when you begin to reassess your business model to see what works and what doesn’t. You may have been lucky and closed out last year on a high note. On the other hand, you may have struck out due to the ever-fluctuating market.
Whatever your bottom line looked like at the end of the year, now’s the time to look ahead and set goals for first-quarter 2023 and beyond. Although the mortgage industry can be unpredictable at times, your own business doesn’t have to be.
Having a plan in place will not only help you get organized, it also will help you better prepare yourself to expertly navigate the market when you face volatile conditions. Not sure where to start? Here are some simple resolutions that mortgage brokers should make today to ensure their business succeeds tomorrow.
Evaluate lenders
It’s an unprecedented time in the industry — rates are soaring, deals are falling through the cracks and you’re left to pick up the pieces for your clients. That’s why now, more than ever, it’s important to have a wide network of lender partners.
Sure, you may have trusted your deals to a small group of lenders in the past. But this doesn’t necessarily mean their guidelines make sense for the scenarios you’re likely to see this year, especially when lenders are regularly pivoting to keep their companies viable in the current environment.
In times of uncertainty, originators must put in the work to show that they are knowledgeable and worthy of a client’s trust.
If you fail to conduct your own lender research, you’re risking rejection for your clients. Here are three main types of lenders to review as you head into 2023. Expanding your network and identifying which lenders make sense for certain loan scenarios will undoubtedly help you avoid fallouts in the future.
Traditional banks. Bank requirements won’t always make sense for borrowers in need of flexibility, but their rates and terms are generally going to be the most attractive. Banks don’t want to lose their depository relationships, so they will go further in 2023 to help you find a solution for your clients, if the client already has an account with the institution.
Alternative lenders. If you want to offer your clients flexibility along with competitive pricing, then you may want to consider an alternative nonbank lender. In a market where rates are higher across the board and solutions matter most, a nonbank lender can be your best friend. These companies generally offer a mix of traditional and reduced documentation loan solutions (think bank-statement programs).
Private money lenders. These lenders could make a great deal of sense for your clients in 2023. (Private money is the term now being widely used for what was formerly described as hard money.) While borrowers may experience some sticker shock with the rate, they will likely appreciate the faster service and flexibility in a period of economic uncertainty.
Establish expertise
As a broker, it’s easy to get caught up in the mortgage process — source, submit, close and repeat. Besides nailing down the transaction, however, it’s equally important to have one-on-one time with your clients. After all, when you offer top-tier service, chances are you’ll retain clients and even gain new ones.
This is especially true in times of uncertainty. Prospective borrowers are looking to you for answers and for a general sense of clarity. You are the expert and now is the time to prove it to your clients.
Here’s a suggestion: Dedicate time each day (or once a week, if you’re swamped) to host “open office” hours, where clients or referral partners can visit — virtually or in person — to discuss the state of the market or any challenges they’re looking to solve. This helps put a friendly face to your mortgage business while meeting your clients’ needs. Most importantly, it gives your network a clear sense of your expertise.
Here are a couple of tips to start connecting. First, pick up the phone. Using email as your primary source of communication is totally fine, but you’ll also want to make some calls. Scheduling calls on a regular basis will help you stay on track with your clients and their unique deals.
Second, set up Zoom calls. Another way to go the extra mile with borrowers is to schedule introductory video calls. This is a perfect way to meet and get to know new clients while explaining all the products and services you offer.
In times of uncertainty, originators must put in the work to show that they are knowledgeable and worthy of a client’s trust. Setting aside additional time each week to connect with your network on a deeper, more human level will make all the difference for your growing business.
Rethink marketing
When budgets tighten, one of the first things to go is marketing expenses. In 2023, you may find that marketing is more crucial than ever. Investments in marketing and brand awareness can really take your business to the next level by helping you generate more leads. The key is to leverage free resources and prioritize paid tactics that maximize return on investment.
Some brokers are fortunate to have a dedicated marketing team to help them expand their business. Others may not have the budget to spend on marketing resources. The good news is you don’t have to break your budget to build your brand and reach new clients.
The first way is to establish your unique selling proposition. This defines what sets you apart from the competition. Maybe you’ve done a great job over the years and borrowers now think of you for a specific type of loan. The problem? Due to changes in the market, you might no longer offer this program. So, you may need to develop a new strategy to clearly define the ways in which you can help today’s borrowers. Once you have the plan in place, simply focus on repetition. It will take time for your network to start thinking of you in a different way.
Another way is to refine your email strategy. Don’t just send random emails on random days. If you do this too many times, you risk losing your clients. Instead, create an email schedule to establish what you want to say and when you want to say it. Start with two emails per week (Tuesdays and Thursdays) to highlight program features, case studies and client testimonials that paint a positive picture of your mortgage business.
Lastly, prioritize education. It all comes back to leveraging your expertise. When clients and referral partners see you as an authority in this industry, they will think of you first whenever they have a business opportunity. The best part is that you can share educational content through LinkedIn or your website — no advertising cost required.
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This industry is hard and unpredictable. You witnessed this firsthand last year, but as a problem solver, you can properly prepare yourself to navigate this market. With a plan in place, you’ll set yourself up for success in 2023 and beyond. ●
