Since you are already reading this message, I presume you may relate in one way or another to the subject of this article. So, let's take a few attentive minutes together to go over the details.
In this article, I shared the insight that we gained through 12 months of deeply engaging with and studying the business operation setup of Independent Mortgage Loan Originators. We are a technology company based in Silicon Valley, with solutions for Digital Marketing and Consumer Acquisition for Independent Mortgage Industry. We have years of experience in digital and online top-of-funnel automation for all range of businesses. In the past 12 months we helped Loan Originators better set up and manage digital marketing channels and consumer direct strategies. This experience exposed us to an in-depth understanding of the day-to-day operations of Loan Originators (LOs). We discovered a fundamental operational inefficiency in the way LOs execute. If you are a Loan Originator who believes the future success of your business relies on adopting modern operation principles, this information is for you.
I have 17 years of experience in running a broad range of digital marketing and online pipeline automation projects, in both Enterprise (B2B) and Consumer Retail (B2C) sectors. Considering my background, when I was exposed to the current state of Loan Originators' business operation, I noticed a striking operational issue that oddly has not been much talked about. I believe it is one of the most important pullbacks in the way of attaining a self-sufficient business pipeline automation for independent Loan Originators. We believe this issues is resolvable by the right setup of tech and services. The content of this article is the foundation that forms the core of the technology and services we offer to the industry.
Before we go over the problem statement, I would like to highlight two facts that are commonly known and agreed upon when it comes to marketing and sales operation characteristics. Any successful sales and marketing department (small or large) puts these fundamental facts into perspective when setting goals, establishing customer channels, adopting engagement strategies and recruiting personality types.
Why am I telling you this?
In our deep dive into the day-to-day business operations of Loan Originators, we discovered a convoluted operational model that LOs deal with on a day-to-day basis without knowing the root cause. This problem appears to be commonly accepted as the nature of a Loan Originator’s job, though I disagree with this consensus based on my analysis of the two facts mentioned above. Hence, I call it the Loan Officer Dilemma. Let me tell you why...
One reality is that the LO's customers are home-buyers or homeowners, hence consumers. This indicates the need for a B2C Marketing Operation or a Consumer Direct approach in order to acquire new customers. On the other hand, the size of the deal is very large, as some say it is often the largest purchase an American household would make in their lifetime. Not only that, it requires so much nurturing and management of collecting and processing the right information and documents, as well as putting the effort to make sure the follow-ups fall through smoothly and timely in order to close a loan, so everybody gets paid.
Hmm... That doesn't sound like an average consumer purchase that falls through Social Media Ads. Instead, it exhibits the attributes of a B2B Deal Closing type of operation which brings us to the second reality: the skills required for closing Mortgages share the characteristics of the skills needed for B2B Deal Closing operations. This means a Loan Officer needs to perform like a B2C Marketer to fill top of the funnel while at the same time he/she is required to deliver professional B2B Deal Closing qualities to close the loan and earn a living. I think now we have a grasp of what the problem is. A Loan Officer has to perform in 2 full-time types of jobs that require completely different skillset and personality types.
The Current State
The current work structure of Loan Originators requires them to perform in two significantly different roles. However, in the rapidly evolving technological and digital world, this model is not sustainable and creates a high level of stress and inefficiency. Having said that, we have observed for example LOs with B2C marketing skills have more success with developing top-of-funnel but attain lower customer satisfaction results at closing. On the contrary, those with B2B style Deal Closing skills usually struggle with growing top-of-funnel, but achieve high levels of customer satisfaction results. In our studies, we learned that most LOs have better skills at processing and closing loans than at Consumer Marketing and generating top-of-funnel demand. That is simply due to the intense career training the Loan Originators go through to acquire their license. They are trained to process and close loans, but they don’t receive any training on Consumer Marketing unless self-learned.
The Loan Originator’s daily operation is a 2-fulltime-person operation type:
B2C Marketer + B2B Deal Closer
This work structure creates a high level of stress and inefficiency. The solution might sound simple, hire a fulltime Consumer Marketer to make it a 2-Person operation and remove the headache. The challenge, however, is that the pay is not enough for two.
The solution is to keep the top-of-funnel concern (B2C Marketing) separate from the operations and activities required for closing a loan (B2B Deal Closing Type). The question is: How?
Firsthand Experiments:Our studies show some Loan Originators have intuitively recognized this issue and taken an experimental approach to resolve it. Below are the two most common ones:
Obviously, neither of the two options above offer a scalable, universal and industry wide solution. They may work to some level for which we should not rule them out completely out. However, we can’t deny that any healthy business requires a self-sufficient and scalable demand generation system. To do so, best practices suggest finding a technology partner with the right expertise who can do it for you in a scalable model at a reasonable price. This is what any high performing executive would do.
What Is The Best Solution?
What to Expect from TAYGO?
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