Thousands of people buy houses every day, and most of those purchases are funded by a mortgage. If you’re a loan officer looking to drum up business, you need to attract prospective borrowers, but how? You want to connect with potential customers who may be interested in securing a mortgage. In other words, you must take the initiative and work on generating leads. Lead generation is the core component of any real estate professional’s business, including mortgage borrowers, but it isn’t always easy to know where to look. Read on to see how you can generate leads, turn leads into customers, and see your business thrive.
What is a Mortgage Lead?
In real estate, the term “lead” refers to any person you may be able to do business with. For home buyers, a lead is a suitable property for sale. For real estate agents, a lead is a buyer or seller seeking representation. For a loan officer, a lead is a prospective home buyer who needs to secure a mortgage to finance their purchase. A mortgage lead could also refer to somebody who’s already a homeowner but is looking to refinance their home, thus necessitating a new mortgage contract.
A loan officer should carefully consider the quality of each lead to assess how much investment is warranted. A well-qualified lead who has a sufficient down payment and is looking to buy a home soon would be considered a high-quality lead. Somebody whose qualifications are lacking and who is unsure about their purchase timeline is likely a lower quality lead. Still, regardless of these ratings, a loan officer should follow up on information from any potential customer.
The Importance of Leads
Much of a mortgage lender’s business comes from direct applications, but not all. Loan officers often need to pursue leads to supplement those that come from applications. In addition to increasing business, this can help improve the general quality of the applicant pool, and a higher quality applicant pool can result in a higher approval rate. When more customers are approved for mortgages, a lender sees a substantial boost to their profit margin, which is the ultimate goal. More approvals also mean more happy customers who may offer referrals and provide even more leads!
This is just one factor that makes leads an integral part of every mortgage business. Loan officers know that most borrowers do extensive research and may even complete multiple applications before choosing a mortgage provider. When you connect with a lead and reach out to them directly, you can make your company stand out from the rest and increase the likelihood of gaining a new customer.
Different Ways to Get Leads
Lead generation is a complex but necessary part of real estate. It requires a combination of networking and investigation that can be tiring if it produces few results. You can significantly improve the quality of your leads, though, by upgrading your lead generation methods. Many loan officers start by marketing to their friends and family on social media. This can get your name out in front of people and help you make connections organically. It can also develop into word-of-mouth referrals that result in more leads to follow up with.
However, many mortgage lenders find that these organic lead generation methods are not enough to increase business in a meaningful way. Luckily, there is another way, and it often produces impressive results. If you’re serious about pursuing leads and using your time wisely, buying leads may be the way to go. Purchasing leads allows you to obtain data from an outside source that often includes the name, contact information, and other personal details of customers seeking a mortgage. This information can come from online advertisements, surveys, and other sources that collect customers’ data.
Deciding To Generate or Buy Leads
Most mortgage lenders would likely prefer to source all of their leads organically. Indeed, lead generation is often a rewarding endeavor when it’s successful, and it is an excellent tool for networking and building a reputation in your community. Nonetheless, it doesn’t always produce reliable results, and you may need to look elsewhere if lead generation cannot meet your goals. This is ultimately the determining question in choosing between generating or buying leads – what are your goals? If you work at a boutique mortgage broker that specializes in serving local residents, generating leads might be the better option for your needs.
If, however, you work at a national mortgage lender that focuses on reaching as many customers as possible, it’s likely in your best interest to buy leads. Buying leads can free up your time to connect with people you already know interested in a mortgage, which can quickly increase your application and approval numbers. Buying leads can also optimize your time by minimizing communications with people who are uninterested, unqualified, or unprepared to move forward with their mortgage application.
Steps To Generating or Buying Leads
When you’ve decided whether you plan to generate leads organically or buy them from a data wholesaler, you need to strategize your next steps. Lead generation typically entails developing a marketing plan that reaches your family, friends, and community members. Many loan officers start by establishing a presence on social media and making people aware of their services. You can branch out from here by investing in local online ads, building a search engine optimized website, and even marketing your mortgage products in local publications.
Buying leads is a much simpler process, but it still requires some research. Rather than scoping out potential customers, you merely need to find the best mortgage lead data seller and find the lead data package that best suits your needs. You should look at reviews and find a platform that provides an all-in-one overview of the most promising client prospects.