Navigating the home loan process can be intimidating as a buyer. It can be just as intimidating as a new or junior mortgage loan officer. If you’re a loan officer, you can probably appreciate the time and resources that it takes to close just one home loan, even if you’ve been a loan officer for twenty years.
I am going to share how I closed 30+ deals each month since 2020.
Do you have a reliable way to know exactly what your day will look like tomorrow?
Do you realistically set monthly, quarterly, annual goals for your team? Do you achieve them?
How accurate is your growth forecast for 2023 and 2024?
Do you know how many assistants you will need to hire to accommodate your growth?
How do you know that yours and your team’s capacity and conversion rate is maximized?
The model that I use, will answer these questions.
By using the model that I’m about share, I was able to help 1,100+ (mostly U.S. Veterans), in less than 3 years, navigate the entire home loan process and close on the purchase of their new homes or refinances with 97% customer satisfaction. This is not rocket science. The most complicated math would be basic arithmetic. Once your model is built, the most important part to ensure success is to manage your day with it. Document your process, know how much time it takes, and understand your realistic conversion rates throughout the process.
Calling prospects, meeting with agents, establishing and maintaining an online presence, keeping up with industry news and guideline changes; these tasks alone could take 40 hours a week without proper focus.
Once a client relationship is established and an executed real estate purchase agreement is received, the real work begins, i.e. ordering title, appraisal, tax transcripts, verification of employment (VOE), verification of deposit (VOD), advising on home inspections, advising on interest rate options, asking for more documentation, the list goes on.
All of these tasks take time. Without focusing on how much time each task should take and understanding conversion between milestones, i.e. prospect > lead > preapproval > contract > close, it can be tempting to focus on the wrong tasks at the wrong time. Doing this will require more time overall to complete the process.
Process: A set of interrelated activities that transform from inputs to outputs
Think of the entire day as a process. Think of the tasks as the interrelated activities that transform the input (prospecting) to the output (closed loan).
Look at your day with focus on where you spend TIME and what the CONVERSION rate is in each milestone.
This will take some effort to establish how much time it takes to perform each task, but it’s worth the investment. Whichever way you perform the task, estimate how much time (minutes) it takes to complete once.
Example:
Origination call – average time: 20 minutes
Follow-up call to get income documentation for preapproval: 5 minutes
Documentation review and preapproval issue: 10 minutes
Preapproval call: 10 minutes
The next step is just as important. Calculate the conversion of each milestone. While there may be one origination call, credit may not be high enough for that one. If 50% of initial origination calls (where credit is pulled) have non-qualifying credit, and the goal is to qualify 5 clients per month, then you will need to allot 200 minutes per month for origination. [10 client calls * 50% = 5 qualified clients with a 50% conversion]. Therefore, 10 client calls at 20 minutes per call = 200 minutes or about 3 hours and 20 minutes per month that you will need to set aside for origination.
Perform this approach for all tasks. After gathering this information, consolidate it on whatever format you’re most comfortable using for spreadsheets, i.e. excel or google sheets. Once compiled, it should look something like this:
This example indicates that by making 10 calls per month, with a 50% conversion rate, 5 clients will qualify and 4.5 of those client deals (on average) will close. As mentioned before, accurately estimating your conversion rate for each milestone, i.e. preapproval, contract, fall-out, etc… will affect the final number (output aka closings).
When accurately entering the time and conversion for each task and milestone in the process, this model will serve as a reliable dashboard for:
Planning your day
No one wants to work 12-hours days for the rest of their life. Knowing what needs to be accomplished each day and how much time it will take can change your perspective on the days ahead. You know what’s coming and you have a better idea of how many loans you will close in the next 30-60 days.
Goal-setting
This model will bring out the elephant – no denying it. Once your model is up and running, it will be painfully clear to realize if it’s taking you 8 hours to complete 3 hours of work or not. Use this realization as an opportunity to improve.
Forecasting growth
Once your model is in place and you’ve been actively using it for a while, if you decide to grow your business, this model will give you the information that you need to scale.
Hiring assistants
We all can agree that goals never go down. If your goal-setting is like just about everyone else’s, then your goals will grow over time. Pairing proper goal-setting and growth forecasting with this model will also give you an idea of how many people you need to hire and when.
Monitoring performance
This model serves as a great tool for accountability. If you and/or your team slack in the process, productivity will show and you can begin drilling down where the time is or is not being spent that should be. Or there may be a change in the process, requiring more resource time. Or there may be a change in the market causing the conversion rates to change. Using a process-based approach to managing people performance is a great way to hold each other accountable without having to worry about taking criticism personally. The focus is on the process. The benefit will be in the hands of the people.
At the end of the day, if you build your own model and manage with it, you and your team will have the ability to accomplish year over year growth in production, conversion, customer satisfaction, and morale.
If you’d like a free copy of the proven model that I’ve used for the last decade, subscribe to my newsletter on LinkedIn.
Terry Roberts, USMC Veteran | Sr. Loan Officer NMLS 397987 | E Mortgage Capital
Terry Roberts is a U.S. Marine Corps Veteran and specializes in residential mortgages, including new construction, conventional, FHA, and VA home loans. He has helped more than 10,000 clients start the homebuying process across America.
With a rich background spanning over a decade in the mortgage and real estate sectors, Terry Roberts has become a cornerstone in guiding over 10,000 clients through the complexities of the home purchasing journey in the United States. His expertise covers a broad spectrum of housing loans including conventional, FHA, VA, and cutting-edge new construction financing options.
Emerging from challenging early life circumstances, including teenage parenthood, dropping out of high school, and facing homelessness, Terry's determination led him to serve in the US Marine Corps. This decision was driven by a commitment to safeguarding freedom and securing a better future for his family. His active duty service in the US Marine Corps, marked by nearly a decade of dedication, instilled in him a profound desire to assist fellow Americans in achieving homeownership, a cornerstone of the American dream that he fiercely believes in.
Terry leverages his profound understanding of the real estate market to empower individuals in their pursuit of property ownership as a strategic investment for wealth generation. His journey from adversity to becoming a beacon of hope and guidance in the real estate domain is not just inspiring but a testament to his commitment to his clients' success.
Connect with Terry Roberts, a proud USMC Veteran and Senior Mortgage Broker (NMLS 397987), for expert guidance on your path to homeownership. Visit www.TerryRoberts.com at E Mortgage Capital, where every client's dream is approached with the respect and dedication it deserves.
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