ARE YOU A MAESTRO OR A VIOLINIST?

Yes you probably want to re- read that title since I know it might sound a bit strange. You are probably wondering what the heck this has to do with the mortgage business or originating loans. Stay with me because this may be the best analogy of our industry and what we each do every day.

First I have to confess that I snore loudly so I rarely attend the symphony and worse I truly don’t enjoy sitting in one place of hours listening to music of any type.

Let’s take a look at a symphony and compare it to our business.

A symphony is composed of dozens of people playing various instruments and a Maestro or conductor who leads them all in making beautiful music. The musicians must be proficient in playing their instruments. They don’t necessarily need to know how to play all of the instruments. THey just need to make sure they play their instrument correctly.

The Maestro however must be familiar with all of the instruments and MUST make sure that all of the musicians are playing their instruments in a way that collectively makes a beautiful song come out. If one or two of the musicians miss a note, or if the conductor gives a bad signal, the song will not come out sounding the way it should. Guess who is always blamed? If you guessed the Maestro/Conductor you are correct.

Looks easy doesn’t it? But it’s really not since there are so many personalities involved and so many moving parts.

If you are set up like most mortgage companies you will have one or more of these people touching your files.
1. Set Up Person
2. Processor
3. Underwriter
4. Closer
Maybe you are luck enough to even have a marketing assistant or loan assistant.

Then of course you have all of the external people involved.
The Appraiser
The Title Company
The agents
The certifications- well-septic- pest etc.

BUT YOU MUST REMEMBER YOU ARE A MAESTRO NOT A MUSICIAN.
We all know that we are responsible for all of these people playing beautiful music that results in a smooth and speedy closing. The reality of course is that whether it’s our fault or not, and whether we made the mistake ( played the wrong note or not) it’s always blamed on us.

This reminds me of two funny stories that help illustrate the point.

One day I was in my office and one of my realtors named Ruth called and before even saying Hi- started screaming at me. She was screaming so loud that the other loan officers and processors in my office started gathering around my cubicle wondering what was happening.

A few hours earlier I had told her that we would not make closing since I did not have all of the items I needed and had asked for to get the loan submitted. When she took a breath I told her that I had asked for these items several times but they had not been sent. She continued screaming asking why I still did not have them.

Being quick on my feet I replied “Ruth, I have an idea, I will pick you up in 10 minutes and we will go over their home. They are probably at work so we’ll break in. You can go upstairs and I will go downstairs and I’m sure we can find the paystubs, w2’s and bank statements that we need to get the loan approved.”

FUNNY RIGHT?
I thought so but this pissed her off even more. She was literally furious and started screaming even louder until I finally had to hang up.

The other story is very similar. The buyer was buying new construction and his lock was about to expire in a market where rates were going up quickly. He called me and immediately started screaming and asking me why the home wasn’t ready yet. He demanded that I hold his rate since the home was not ready and demanded to know when it would be completed. He was also screaming loud enough to gather all of my fellow originators and staff who wanted to know what I had done this time to make someone call screaming that loud.

So again being fast on my feet I told him that I would grab my hammer and ladder and that he should grab some nails and screw driver, plyers, and I would pick him up in 10 minutes so we could drive over and immediately finish home so he could settle.

FUNNY RIGHT? Thank goodness, unlike Ruth, this guy actually had a good sense of humor and started laughing and apologizing. He was furious and just needed someone to vent to.

BUT THERE IS A LESSON TO LEARN FROM BOTH OF THESE SITUATIONS and THE WHOLE MAESTRO VS MUSICIAN DISCUSSION.


The first lesson is that you should always be an offensive communicator.

That means that you must meet with your processor at least once a week and review all of your files to make sure that all of the other “musicians” are doing their job properly and on time. You should the report to the client, the listing agents and selling agents to ensure that everyone knows what’s happening and what is still missing.

The second lesson is that you must always keep in mind that you are a MAESTRO and NOT A MUSICIAN.

That means that you have a strong team and that each person is doing their job. You should never ever be setting up, processing or doing any of the other functions that go into getting a loan from application to closing. Your job is to constantly bringing in new business and make sure that your team is playing beautiful music so you can be seen as the ultimate Maestro. ( Please go back and re-read that because all too often I see originators being way too involved in their files at the expense of bring in new deals.


The THIRD LESSON is perhaps the most important of them all.

You MUST Be a master of persuasion and manipulation. No, they are necessarily bad words because each and every day we are either being persuaded and manipulated or we are manipulating and persuading others. This is a topic I have studied and mastered for over 30 years.

WHY?
Because if you are not an expert at persuasion and manipulation then you are being manipulated. You must know how to get other people to do what you want them to do, when you want them to, and still feel good about it.
There are 22 persusasion tactics that I predominately use to generate new deals, get referrals, and get my staff to do what needs to be done. In fact it gives you an UNFAIR ADVANTAGE over all of your competition when you master these skill.

There is also a very simple 27 word sentence I learned and share in the LO UNFAIR ADVANTAGE PROGRAM at
http://lounfairedge.com/1-2/

Always keep in mind that you should always set realistic expectations. Never take responsibility for others mistakes. Make sure you have a great team of musicians and that you are leading them to play beautiful music.
Integrate some of these ideas into your own mortgage business right now and watch your production grow. Feel free to pass on this article to anyone you think would benefit from it.

Dedicated To Increasing Your Production,
Brian Sacks
www.TopOrigiantorSecrets.com

And if you are interested in learning more and getting an UNFAIR ADVANTAGE in your own business and life make sure you check out the LO UNFAIR EDGE at http://lounfairedge.com/1-2/

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Are Millions Of Boomerang Buyers About To Ignite The Real Estate Market?

Are Millions Of Boomerang Buyers About To Ignite The Real Estate Market?

These next few years will see the peak of Boomerang Buyers coming into the market and unlike other buyers these buyers require special attention due to their past issues.

This is an interesting article on the millions that are due to come back into the market. Special thanks to Dave Hershman of Origination Pro for forwarding this article to me.
Remember all those people who defaulted on their homes during the last housing crisis? Well, those bankruptcies are about to be discharged, or they already have been, and that means we could soon see an avalanche of homebuyers hitting the market.

Just what constitutes an avalanche? “More than 12.8 million homes entered the foreclosure process – roughly 29 percent of all homes with a mortgage,” between 2007 and 2014,” said The BIG Picture. “At the peak of foreclosures in 2009, more than 650,000 homes, 1.5 percent of those with a mortgage, entered foreclosure in a single quarter.”

According to CoreLogic, this is a key year for boomerang buyers because seven years have passed since the peak of foreclosures in 2010. A whopping “1.9 million homeowners who faced owner-occupied foreclosures between the start of the housing crisis in 2007 through 2010 will have met the seven-year period after which the Fair Credit Reporting Act requires derogatory information to be removed,” they said. “By the end of 2020, another 1.2 million homeowners who lost their homes to foreclosure between 2011 and 2013 will become eligible.”

A new TransUnion Study Found that, “1.5 million homeowners negatively impacted by the mortgage crisis could re-enter the housing market in the next three years.”

But do they want back in?

Many think so.

“The chief attraction is strong motivation, Kent Temple, broker/owner of Keller Williams Realty – The Temple Team in Mooresville, N.C., said on Bankrate. “If you’ve been through a foreclosure, you’ve already been a homeowner. “You know what it’s about. You know the process. You’ve been through hell sometime in the last seven years, and if you really want to buy a house, you are so willing to do whatever it takes.”

But some aren’t so sure.

“As those foreclosures began to clear, many observers speculated that a slew of ‘boomerang buyers’ was poised to return to the housing market,” said The BIG Picture. “Those buyers have been slow to materialize. So what’s hindering their return?”

Oh, little things like:

Rising home prices
Rising mortgage rates

Low inventory
More stringent lending requirements
Credit scores that haven’t jumped back up to where they need to be because of other delinquency issues
There may also be the fear factor. Do buyers who lost a home to foreclosure once before want to take the risk again? If they do, they are largely looking to be more careful this time around, said Jami Harich, a real estate agent with Avery-Hess Realtors in Fredericksburg, VA, in the Washington Post. “Most buyers I work with now, especially if they lost a home in the past, don’t want to get in over their heads. They start with a monthly payment that they want to stick to, and then I show them what they can find on the market that fits in that budget.”

Whatever their reasoning, “History says not all those buyers are likely to come back,” said The BIG Picture.

“According to a 2016 study by CoreLogic, fewer than half of those who lost a home in 2000 or later have purchased new homes, even among those 16 years past a foreclosure.” The boomerang rate has been especially low so far for people who lost their homes during the crisis. A little over 30 percent of borrowers who lost their homes in 2000 had purchased another home seven years after the event. But only about 15 percent to 20 percent of borrowers who lost a home between 2006 and 2008 had returned to the housing market after seven years.”

Quick or slow

Perhaps it’s the rate at which boomerang buyers have been returning (or not) to the market that has surprised industry experts the most. Instead of the rapid return like many had predicted, the boomerang effect has been more tempered, according to CoreLogic.

“While millions of former homeowners reentering the buying market would have a significant impact on home sales, historical data shows a more gradual return rate for these so-called boomerang buyers, with less than half returning to homeownership even 16 years after the foreclosures were completed. Historical return rates show recent incremental volumes of 150,000 boomerang buyers returning per year, or 12,500 per month. Of the 4.4 million owner-occupied foreclosures completed since 2000, 1 million foreclosed homeowners have returned.”

Now the big question- How Do You Position Yourself To Profit From this ENORMOUS NICHE?

Here’s a 60 minute presentation that will show exactly how harnessing this niche can take your business to the next level and INSTANTLY position you as the OBVIOUS GO TO EXPERT in your town

http://boomerangexpert.com/nowv2/

Dedicated To Increasing Your Production
Brian Sacks
www.TopOriginatorSecrets.com

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ARE BUYERS REALLY LIARS ???

ARE BUYERS REALLY LIARS OR IS IT YOU?
One of the first things I heard years ago when I started as a Realtor was “Brian, you’ll quickly find that most buyers are liars” That struck me as being very strange but a year later when I started as a loan officer I heard the exact same saying.

But what I have come to find out is that it really has much more to do with the person asking the questions and the actual questions that are being asked. So let’s dive in and break down each of the items we need to know and the right way and wrong way to ask the questions.

There is a lot of psychology that must be taken into consideration when asking someone you have just met all of the personal questions that are part of our job.

Just like the computer saying- Garbage in and Garbage out. The questions we ask matter. In fact ,they will either build rapport or completely alienate the buyer and have them running to a different lender.

BEFORE WE EVEN DISCUSS THE QUESTIONS WE NEED TO UNDERSTAND POSITIONING.

Consider first that we are all viewed as Heads of Lettuce which means that we are a commodity. The consumer only knows to judge us on price, not expertise. So a loan officer with a low rate that has been in the business 3 months is often able to get a deal away from a seasoned pro with 25 years of experience that has a higher rate.
There is a way to fix this by becoming an expert that I show you in the Boomerang Expert system at http://boomerangexpert.com/nowv2/

Your phone rings and on the other end is a borrower who wants to get pre-approved.The borrower doesn’t know you and you don’t them. The WAY they were referred to you matters a great deal in this situation.
If a Realtor- Friend- Co Worker- or other professional referred them this conversation will progress much better than if they just saw your ad or face on Zillow.

YOU MUST POSITION YOURSELF AS AN EXPERT – PERIOD !

When you go to a doctor they speak with you and then examine you. They then make a diagnosis and provide a remedy or prescription. You don’t question it if you are sick you just do it. Granted you may want a second opinion but you aren’t price shopping you just want confirmation. That is exactly how you must be seen to be successful or you will spend your day being a rate quoting machine or even worse, doing nothing but hoping the phone rings. Now back to the important questions we must ask and deciding if buyers are really liars?

Think about our job for a second and how truly awkward it can be.

You start the conversation and then ask.
“ How much do you make?”
“ How much money do you have in the bank?”
“How’s Your Credit?”
Really stop and think about that for a minute. You have now asked a total stranger all of these personal questions. Heck, you might not even ask a person you are dating or a family member these personal questions right?

START WITH QUESTIONS NOT RELATED TO THEIR PERSONAL FINANCES.
I generally start by asking their name and contact information. Then we discuss where they are in the process and finally how they were referred to me. To be perfectly transparent , I generally prefer and offer to meet them in person. Nothing is better at building rapport then meeting a person face to face so you can get to know them and have them feel comfortable with you .
The added benefit of course is that if you have prepared them properly they will be providing you with their bank statements, w2’s and paystubs. When someone has gone to the trouble of providing you with their information you have immediately reduced the chances that they will shop rates when they finally purchase a home.

Lastly I always start by asking them questions about what their goals are. How long do they anticipate being in the home? Have they seen any homes they liked?

NOW TO THE QUESTION S AND IF BUYERS ARE REALLY LIARS?

Let’s start with the first question which is about income.

“HOW MUCH DO YOU EARN?”

This may sound basic to many of you reading this but this is actually a question I hear being asked. The buyer on the other end says I earn 80,000 and then you later find out that it is made up of 50,000 from salary and 30,000 from overtime which he only started working last year.

IS THIS BUYER LYING?

We know that overtime, bonuses, and commission income must be averaged over 2 years. But your buyer doesn’t know that and so they are simply answering the question you asked them.
Instead of asking the How Much Do You Earn question try this.
What Do You Do For A Living?
Are You Paid Hourly or Salary?
Do you work overtime or receive bonuses?
Of course if they are self employed or commissioned only employees we will need to see their tax returns and use their net income not their gross.

NOW LET’S MOVE ON THE QUESTION ABOUT ASSETS.
I hear loan officers asking buyers “How much money do you want to use?” or “How much money do have to work with?” The problem with this question is that the buyer imagines your hand going into their wallet or purse and they immediately tense up.
Think about the last time you asked this question and the awkward silence for a few seconds you heard on the other line.
Instead try asking the same question this way.” How much do want to invest in this transaction? You will need some funds for down payment and closing costs and this will help me suggest the proper program options for you .”
Depending on their answer you may also need to suggest first time buyer grants and how lender and seller credits work. You can also explain gifts from relatives as well as withdrawls or loans from their retirement accounts, which are sources they may not have thought of.

FINALLY – LET’S DISCUSS CREDIT.

You should never ask the buyer “How’s Your Credit?” There’s nothing worse than working with a client for months only to find out later when you run their report that they have serious issues.

Most buyers are very apprehensive about having their credit run because they fear it may hurt their credit scores. It’s important to let them know that although pulling credit is a hard pull , it should not seriously affect their credit. You may need to also let them know that all mortgage pulls within 30 days count as 1 pull and again should not adversely affect their scores.

I try to explain it this way. “ I would like your permission to pull your credit report. It’s important for us to know you credit scores and it’s a good idea for you to make sure that the information on your credit report is accurate. We often find items on clients reports that they were not aware of.”
Once you have said this, it CRITICAL that you immediately ask them for their date of birth , address, and social security number.

It’s also important to ask for these items in this exact order since their social security number is the one piece of information people try to protect the most. Asking for it last , after they have given you all of the other information makes it easier psychologically for them to provide it.

One last important item on their credit report.

Many times your client will tell you that they already know their credit scores because they are signed up for credit karma or get it on their credit card statements.
It’s important for you to explain to them that there are different scoring models for credit cards, installment loans, and of course mortgage financing.

While we are on the topic of debts you should of course also ask them if they are paying or receiving alimony or child support.

MAKE SURE YOU END YOUR CONVERSATION CORRECTLY.
Now that you have all of their information you need to suggest the various programs that would be best for them. Explain the differences and why you are recommending the programs that is best for them.

As you are wrapping up you should also encourage them to send you their documentation of income and assets so that you can keep them on file for when they find the home they want to put an offer on. You should also explain to the difference between pre- qualifications and pre-approvals. Let them know that you would be happy to provide them with a pre-approval letter to accompany their contract once you have received their supporting documents.

Aside from needing to verify what they have told you for income and assets, collecting this information stacks the odds in your favor of getting their loan when they are ready to apply since most people would prefer not to have to gather all the information and send them to various lenders.

The bottom line is that buyers are generally NOT LIARS, but there are many lenders that are simply not asking the right questions. Print out this article and keep these questions handy for your next phone call or meeting.

Dedicated To Increasing Your Production,
Brian Sacks
www.TopOriginatorSecrets.com

Brian Sacks is a nationally-renowned mortgage expert who has career closing of more than 5,924 transactions for more than $1 billion. He has trained, consulted and coached, tens of thousands of loan officers and company owners over the past 31 years on how to close more loans, make more money, and still have a life. Brian is the host of “Top Originator Secrets,” which can be seen weekly on Mortgage News Network and on his blog. You can get more information and grab your free report on “How to Get Agents Chasing You” at TopOriginatorSecrets.com

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