Mortgage Think Tank

Too often, business professionals look at something as mundane as writing a press release with an odd mix of disdain and misunderstanding.

This stems from the fact that writing a press release is not something the typical executive wants to be doing with their day.  Also, and my wife, college english professor, can attest that the majority of people are unable to write.

But, there are certain firms in the mortgage space that make a living of exploiting this weakness. Before you sign a contract with a firm to provide marcom services, ask yourself.

What does my organization need to accomplish with their marketing and pr efforts?

How often does my organization have ‘news’ worthy of a press release?

How many industry publications and web sites do I need to have cover my news?

Do I really need help with marketing strategy, and not execution?

So often, I have talked with firms that have huge retainers with firms that provide little more than boilerplate press releases written by college graduates. No offense to college graduates.

If you need only the occasional press release, why not hire an executive admin who would write the piece, follow up with the press and make you available for interviews.

I would say one of the biggest mistakes that b2b marketers make, besides not believing in the value of brand and advertising, is that they believe creative doesn’t need to be pretty as long as their message is there, slotted in like a memo amongst some pretty clip art.

Are c suite professionals not human? Do they perceive ads differently?

I don’t think so. What is a c suite professional going to do when he see’s your ad?

Is he going to stop doing what he is doing, and call you?

I don’t think so. Eighty-five percent of the time he is going to respond to that print ad by going to your web site.

What does that mean?

Your ad could have all the information you think your buyer/prospect needs to make a decision, and he is still going to go online and check your site out.

Two things you should do with your ads, both print and online:

Direct Response

Branding

That is it. And do ugly ads get noticed? Does anyone want to marry an ugly spouse? If your ad is ugly, what does it say about your product or service?

That’s right- its ugly!

So when you are thinking about what you want your ads to look like- don’t look at what endemic advertisers are doing. Go out and pick up a general consumer magazine- perhaps something like Q or Wired. And go through and see what advertisers that play on a larger field or doing- their stakes are higher. They need to reach millions and get consumers to act when they don’t need to. You need to reach hunderds, perhaps thousands and you need merely to influence them to consider your service when they are ready to buy.

Of all the vertical market segments out there that marketers might need to target, there are few that have the characteristics of the mortgage industry.

Unlike other industries that have consolidated, the mortgage industry is consistently adding new market participants. The barrier to entry is small and based on knowledge of two kinds- knowledge of processes and knowledge of people. If you are an industry veteran, it is relatively easy to start up a new shop, either a brokerage or lender, and to a lesser extent, investor. I do say this without first hand experience, and I think I know some people that might disagree. But, I do make this statement based on observation, and how players move about and start up new efforts.

True, it is very easy to go out of business- just ask Acoustic and the others that have gone out of business this year. But, I would bet that the better talent from Acoustic have already landed on their feet at new or established players.

What does this mean for marketers?

Two things- your job is easier and harder!

Easier, because there are always fresh players for you to market your services to, whether they are brokers or bankers.

Harder, because of the flux, you constantly need to market.

I personally will take this over other financial segments like banking where there are no new players, just bigger ones getting bigger.

Happy Independence Day for all the bankers and brokers that have declared their Independence.

Keith Gregory for Mortgage Think Tank

Here’s one of the biggest problems with new technology in the mortgage lending space: some people think that making inefficient processes happen faster makes them efficient. That’s not always the case, especially when these processes impact other parts of the business by messing up what could be a smoother workflow.

No matter how quickly you fly to your layover destination, you’ll never do better than a direct flight.

The mortgage origination process has never been accused of being a streamlined operation. Technology hasn’t done all that much to help it yet, though we’re tracking some cmpanies that are working hard to do so. But before I get you thinking that we’re the only bad boys in the neighborhood, consider the boys from BumpTop.

Surf to their site and you’ll be served up a video demonstrating their new technology, which promises to take the computer desktop to the next level. Why have a collection of orderly icons and buttons when you can have a desktop that really looks like the top of your desk?

Why? Becasue the top of my desk looks like a volume of the World Book exploded over it like a neutron bomb (for you youngsters who may not know, World Book was one of the companies that was big when Wikipedia was printed out and only knowledgeable people worked on the articles).

With BumpTop each file is represented by a little electornic booklet that can be tossed around with the mouse and stacked up, just like the paper documents on our real desks.

To me, this is a perfect example of technology developed to automate an inefficient process. It’s very clever, but should never find its way into the working world. I can just hear it now: “So sorry, Mr. and Mrs. Homeowner, I lost your application under a stack of icons on my desktop.” Won’t float.

How much of the technology you’re using today is just allowing you to do dumb things faster? Before you get caught up in all the compliance-related arguments that generally keep originators locked in the past, check out some of the companies that are finding innovative ways to stay in compliance while they make the origination process better.

Rick Grant for Mortgage Think Tank

If you’re out in the field originating mortgage loans, you have your work cut out for you in this market. Not that things are that tough out there yet, but you’re not in the happy part of the cycle. If you know what’s coming, you’re already out there forming stronger alliances with good sources of business, combing back through your past client database and generally preparing to leave your order-taking days behind. That’s all part of the work you do.

For my part, I ask questions. I look at the work you do and ask how and when and why. Sometimes good stories result. Recently, I took a look at Source Media’s Top 50 lists and asked whether brokers agreed with the results. I wondered how the editors came up with the companies that made their two lists.

According to Mortgage Technology Editor Scott Kersnar and Managing Editor Anthony Garritano, a company must satisfy four requirements to make their lists: 1) customer satisfaction; 2) functionality; 3) market share and 4) have a viable revenue model. All good criteria, to be sure. While I have heard from a number of industry vendors who were dissapointed that they did not make the list, I have yet to hear from a single originator who disagreed with the results.

So what do you think it takes for you to make it to the top of the borrowers’ list of mortgage originators? Can you isolate four criteria that qualify you for such an honor? If you can’t, chances are neither can the borrowers in your neighborhood.

Give it some thought because only those brokers that make it to the top of the list will be successful as we move further into the mortgage lending cycle.

Rick Grant for Mortgage Think Tank

Memorial day is the traditional beginning to the summer season in the United States. All across the country, families will come together on back yard decks and enjoy meals cooked on an open grill. Instead of the shelter our houses have been through the cold winter and wet spring months, they become entertainment venues of every shape and size.

We in the mortgage business will also be among that number, enjoying ourselves, our families and our homes. It’s a good time to remember that while the mortgage loan may seem like a business transaction to us, it’s much more to someone buying a new home. It’s the key that opens the door that leads to the deck and the grill and what will hopefully become a lifetime of memories.

We often think that we add value to people’s lives by getting them money. The value loan originators bring to American families goes far beyond that. You’re helping make something possible. As the market continues to change, you can expect to be working with many Americans that might not have been considered for a mortgage just three years ago. They’ll be counting on you (as will your wholesale lenders) to find a way to make their dreams possible. Just like you’ve been doing for awhile now.

I hope that sometime during this holiday weekend you’ll take a break from your grilling duties and give some thought to some of the weekend cookouts you’ve help make possible. And pat yourself on the back.

See you back at the office on Tuesday.

Rick Grant for Mortgage Think Tank

If you could look through your wholesale lender’s eyes, what would you see in yourself. A valuable source of new business? A trusted partner in the work of satisfying borrowers?

Bankers, in my experience, see the world in terms of risk and reward. To some degree, all business people wear these glasses, but bankers are exceptionally good at identifying risks. They can sense it sense it like a Lensman from the Chronicles of Riddick. They recoil at the first whiff.

You can’t blame them, really. The downside for the lender is almost always more severe than the risk faced by the third-party originator. So what does your lender see in you?

I’ll be traveling out to Monarch Beach, Calif., next month to get a better idea of the risks lenders are monitoring right now. Lenders and vendors from across the country will be coming together for the sixth annual Predictive Methods Conference there. High on the agenda will be the subject of fraud.

Bankers have read that close to 70% of fraud is perpetrated on the 1003. Where do they get that document? From you, of course. Whether this figure is accurate or not, it surely adds a hue to the glasses bankers are wearing.

How are you protecting your wholesale lenders from fraud today? Can you document your procedures? Do you discuss it with your AEs?

While it’s true that third-party originators are vitally important to lenders at this point in the cycle, you can’t take the fear of risk out of the banker. If you’re not thinking about putting your lender’s fears to rest, you should be.

–Rick Grant for Mortgage Think Tank

When it comes to marketing to third party originators, KISS is a great standard. Not because brokers aren’t sophisticated. I know plenty that rival top lenders in the way they think about and use technology. But rather because they just don’t have time for complicated sales messages.

These hard-working folks make their money only when they close the deal. All the work that leads up to that — prospecting, lead cultivation and incubation, customer counseling and managing the processing — is given away in hopes that the borrowers will actually sign the closing docs when they sit down at that table. And the more successful a broker is, the less time he has to figure out what new product or service will have any chance of making his life easier.

No, if you want to market to a broker, you need to demonstrate your value before the elevator makes it to her floor. Once she gets off that ride, your chances of having any influence are over.

I’m speaking metaphorically, of course. That ride could be an elevator, but it could just as easily be the 15 seconds she spends on your homepage or the 10 seconds he spends looking at your recent postcard. In any event, it’s a short ride. You need to have a simple and powerful message to make an impact or he’ll be on his way to the next mortgage deal.

It’s not that brokers don’t want to do business with you. Many are seeking you out, in the five or ten minutes of free time they have each day. But to get their attention, you have to be spot on target when their eyes move over you. That’s what brokers want. They want to find ways to do what they do better, faster and more profitably. Can you help them? Make sure it doesn’t take you more than a few seconds to say “yes!”

–Rick Grant for Mortgage Think Tank

http://www.youtube.com/watch?v=aeXAcwriid0

I read about this today in WSJ. Apparantly, this was done by MSoft designers. Apparantly, they either have a good sense of humour or too much time on their hands.

Does this belong on this blog?

Sure, why not.

I believe it speaks to simplicity in marketing.

 KISS - Keep It Simple Stupid.

Applies to the mortgage professional who is responsible for marketing to other mortgage professionals.

If you are a wholesale lender looking to reach brokers, you might humorously state that many mortgatge brokers fit into the last ‘S’ of KISS. But that is an overused generalization.

Brokers need to be dealt with like a general consumer audience. Too often, ad agency’s, publishers and large marketers treat them as one would a typical C Suite b2b audience.

They’re not. Many are simple people trying to get by who want to make a good living for their families. They don’t have boards or shareholders or internal constituants. They don’t have targets, growth plans or compensation plans. They get by, by getting by.

Headlines should read- Title Companies Win Big.

 I’m sorry, but a $2m fine & a roll back of 15% on rates is a light penalty, given the absolute racket title insurance is.

 If someone really wanted to do something about ‘predatory lending’, they’d take a look at things like Title Insurance, PMI and Flood Certification. These are the biggest rackets out there.

 Why should I need title insurance? To prove the seller actually has clear claim to sell the property. If they don’t, its called fraud.