Schneider, Howard, Mortgage Banking
Sales trainers and business coaches have been urging originators for years to "think outside the box." Most people trying this technique focus their efforts on finding ways to increase their sales. After all, top salespeople win company awards and are admired by their peers. Such salespeople find ways to stand out, and keep discovering new opportunities.
Yet sellers who work more like marketers are also more likely to think outside the box. Instead of wanting greater opportunity, they prefer to start small and grow. Over time, they're able to fashion a sales business around their personal strengths by staying within a niche market.
Having a strong base means they don't care as much about what is happening in the economy as more-traditional loan officers do. Many of these originators took advantage of falling rates to push refis a few years ago. Soon afterward, they began financing more vacation homes as rising values attracted real estate investors.
Today's smaller loan market has many of these formerly successful originators seeking opportunity in other sales fields. However, loan officers who have established a strong presence in a small specialty will continue finding business. Niche markets with great potential now range from helping immigrant homebuyers to providing mature homeowners with reverse mortgages.
Thinking small helps a loan officer who doesn't have a large staff or huge marketing budget to be noticed. A community may have many lenders, but how many focus on reverse mortgages or commercial property loans? Taking the time to learn specialized products and build a reputation can establish a presence other originators would love to have.
Most lenders will continue being "me-too" businesses, and compete with each other on price for generic mortgages. Yet loan originators know that success doesn't depend on outperforming your competition. No lender can offer the best price or provide the quickest approvals all the time.
Instead, success comes down to how your prospects perceive you, according to marketing experts Al Ries and Jack Trout, who together have co-authored five books on marketing strategy and positioning. Defining yourself as a generic lender doesn't help you win raving fans as much as letting a select group of consumers know you specialize in helping people like them. You'll stand out by focusing on a small market segment, explain Trout and Ries.
A narrow market position can be successfully defended by a small firm, but it's harder for a mortgage broker to compete on all loan types with national lenders. Yet you can develop a specialty, such as using local mortgage revenue bonds to help low-income households to purchase. "Try to pick a segment small enough so that you can become the leader," advise Ries and Trout. …