by Brian Sacks
Are you woefully tired of being seen as a “head of lettuce”? Sick to death of only being shopped for rates and points? The reality is that no one will ever have the “best” rates and points. Unfortunately, we’ve set ourselves up to be seen as a precisely this, a commodity, or a “head of lettuce.” You know as well I do that the only some buyers can make a buying decision is by comparing price.
To illustrate, consider this familiar scenario. You’re out, and someone asks what you do for a living. “I’m a loan officer,” you reply. “Oh, what are your rates?” they counter. This is the “head of lettuce” syndrome in its finest form. Now consider other industries. There are doctors who have general practices, and then are heart specialists, endocrinologists, kidney, liver, lung specialists. There are dentists, and there are oral surgeons. There are accountants, and there are tax experts and auditing experts. There are attorneys, and then there are divorce, tax, labor and litigation experts. In every single case, the specialists make a lot more than the generalists. So, why is it different in our industry?
One of the concepts I have lived by, and taught to thousands of other successful originators and company owners, is “Pick a niche, become the expert, let everyone know about it.” Need a few niches to think about? Well, how about reverse mortgages, Jumbo’s, FHA, VA, construction, lot loans? There are numerous others.
Some specialists may come and go based on the market conditions. But, some will always be around no matter what the market does. So here‘s what you need to do now. Find a group that is easily reachable and has a problem. Find and learn the programs that will solve their problem, and then let them know you can help. Becoming a specialist in this one niche will allow you to thrive during regardless of market conditions. The reason? It is very formulaic and it works.
For example, my niche was working with buyers who had a bankruptcy or other credit challenge. They never asked about price, they simply wanted to know if I could help them. I know what you are thinking, “Well, that was fine a few years ago but that would never ever work now.” To which I will respond, “Wrong! FHA and VA both still have programs that are viable for people who have had issues.” Or you may be thinking “Yes, but now the rules have changed.” To which I will respond “Correct! Now go find the ones who meet the new criteria and let them know you can help.”
Here’s my personal motto (that you are welcome to use with your own niche the next time someone asks you what you do for a living): “I help buyers who have had a bankruptcy or other credit challenges get into a home with attractive rates and low down payments.” It really is that easy. But it is also really that specialized
In closing, let me go ahead and address some concerns you have. Namely, that you can’t afford to turn away any business right now (aka, you need to be a generalist). First, let the record show that I wholeheartedly agree, and am not advocating that you turn away any business. Instead, I’m merely suggesting that you only market to the most profitable clients who have an issue you can solve so you are compensated for your expertise. That is, I discourage you from being everything to everyone all the time.
Take some baby steps, and once you start seeing the results with your own eyes (and wallet) go ahead full speed. I was scared, too, when I first decided to be a specialist but I quickly went full steam ahead when I started earning $5000.00 per loan instead of being the generalist earning $500.00 a loan.
See, it takes a lot of loans to make any real money when you are a generalist ‐ especially with price sensitive clients. However, when it comes to people with problems (such as credit issues) they just want a solution and are not nearly as price sensitive, and this is where your specialty becomes priceless.
Brian Sacks is the CEO of www.loanofficerformula.com He has been an industry expert for over 24 years closing over 6000 loans totaling 1 BILLION Dollars. Brian has trained thousands of originators and company owners in North America sharing his “FORMULA” for success that will allow you to close fewer loans, Make More Money and Have a Life regardless of market conditions.