Tag Archives: Home loan

Mortgage guidelines, Mortgage Originators

HOW TO PRICE A LOAN – Correctly

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Easy go to my website; QUICK PRICE MOTIVE-ATION

However, what I find in pricing loans all day is that Brokers don’t see the QM math.  Maybe I just see it super fast as some number nerd.. lol  Here is an example, and my Broker didn’t see it.  His comp is 2.75% and after the LPC the rate sheet had from 4.625% to 3.25% available on the pricing engine.  We see the top rate paid back almost 1.5% after comp, and 3.875% was par on this 601 FICO FHA client.  BUT, the client needed a lower rate for qualifying, so the broker didn’t know he couldn’t go past  3.625% as a rate costing the client 1 point roughly.  (1.083 costs).  And when he hears me state that asks, “well why?”

GREAT QUESTION!  If QM limits to 3% then we don’t have a lot of room after the 2.75 you charge Mr Broker.  In the industry now it’s not really 3% of the loan amount, it’s like APR was and is 3% of the loan minus costs now basically is a great way to gauge it off the top of your head.  But think of it this way, YOU CAN BONAFIDE ONE DISCOUNT point on loans as long as it’s not the top rate or the lowest rate.  So, 2.75 + .083 = The top your going to be able to give client in costs.  Means the teeter totter effect on the rate versus costs bottom’s out.  You have to see that in advance before LOCKING LOANS!  3.5% on this loan was a cost of 1.509 and with that and the 2.75 comp it’s not passing QM.  I can see it, so should you.

Biggest closing issue this month is loans not passing QM and the LO should know how to figure this out.  You can’t have a 2.75% comp plan and then charge 2.75 in points, the most your going to get is 1.125% ish as cost to bonafide one discount point and have the .125 + your comp go into it.  THIS ASSUMES, you waive the underwriting fee, not in TX and you don’t have any other affiliated business fee’s going into QM tests.

As a cheat sheet, this is what goes into QM;

Lender Paid Commission/Borrower paid commission + Underwriting fee + TX attorney fee + Points (after 1 bonafide discount point exempted) + any affiliated business profit = QM 3% or less.  *note this is a fast way to do it in your head and not be off by 1000’s and is not 100% all the algorithms to use. Use your internal software and run the true test.  But with naked eye this hopefully will help some “see it”.  – Juiceman

 

Mortgage Originators

OBJECTIONS & ENTHUSIASM

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The second step in sales besides knowing how to vision the yes through belief is to handle the ask for more information.  This is often called objections in the sales world.  It’s really the prospect asking for more information.  View it that way.  The best TRICK with any objection is to stop and rephrase the “objection” as a question in your head and then answer it.

There are THREE (3) main reasons why someone objects to something.  1; To DEFEND themselves.  2; It’s a VALID EXPRESSION of where they are in life. 3; They are FEARFUL. Yes, they could be that broke.  Yes, they could be having a bad day and your timing is off selling them whatever, or it is fear and they may not see the value your adding.

Remember people buy from people they like.  So stand up if you sell over the phone, MOTION CREATES EMOTION.  Too many times I’ve done a sales seminar or free strategy sessions with Brokers and Mortgage telemarketers and they don’t have any type of persona while on the phone… they sound like plain Jane.  WHAT?  Your in the telemarketing sales and you don’t have a PHONE CHARACTER that you develop while on the phone? How do you get people to like you with such a silent “charm”?  Create that energy, create that phone voice that is fun to work with and others will be receptive.  Smile as you do it, even if it’s over the phone, it’s amazing how others can “see” it.  And respond to objections with energy and with enthusiasm.

ENTHUSIASM is the key to persuasion without pressure.  Minimize your objection time and work the head not the wallet.  Do this by selling value to the client first, ask questions to uncover their wants and then fulfill them with your product or service.  99% of the time a sale is made, either they buy from you or you bought why they can’t.  That’s why the best of the best sales people tell lots of stories.  FACT TELL< STORIES SELL.  Paint a picture with your client while answering their questions and presenting value.  Assume the sale, paint the picture of better credit and less monthly payments, paint the picture of the new house with a red door and blue shutters.  The use of painted pictures in sales should help describe in more detail your products/services and values or your clients using them.

One of the best “canned objection” responses is that of FEEL, FELT, FOUND.  This technique can uncover the real objection fast (if there is one) and help you be a natural at adding value, answering their need for more info and paint a picture to aid the sale.  Telling the client you understand how they FEEL, it helps them see you are not emotionless.  Telling the client you’ve FELT that same way, or add familiarity in some way.  Then tell a story of how you FOUND a solution to X Y OR Z as their concern that will help you portray the added value in your pitch.

Happy selling this afternoon, I’m posting a bunch of “canned responses” to various mortgage objections all day on the face book group, THE MORTGAGE JUICEMAN GROUP

-Juiceman

Mortgage Originators

Impulses to buying

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To sell something really anything you have to know your audience.  Most then don’t fit them into some category to help aid an Impulse for a buy as quickly as others.  This is a sales skill that develops over time at any place.  And the top 5% producers at any sales company have it down “canned”.  Responses that appeal to one of these impulses or multiple ones and then drive it home for the sale.  They are; Fear of loss; Urgency; Greed; Indifference.  These are the things that make up FUGI.  And is an acronym that all in sales should know.  These are IMPULSES that help a client buy.  Understanding them and then applying this while selling will help you actually SELL.  Or at least know how to respond in the act of pitching your product.

Fear of loss is a big one.  Fear of loss and missing out on the lowest rate is akso the “why” when someone is shopping you.  Urgency is created with a LIMITED AMOUNT OF TIME or LIMITED NUMBER of widgets for example.  But how many of you mortgage experts push this, it seems NOBODY PUSHES URGENCY like they should.  Loans shouldn’t take 30-45 days to close.  Rates change daily, did you forget this?  Greed is playing on what got the clients in this mental state.  They want what the “Jones’s”have, the low low rate talked about at the water cooler at work.  Then there is Indifference.  Indifference is where the consultative sale is.  The key to indifference is asking questions, and using the information to guide your sale.

People buy from people they TRUST.  In order to get them to trust you, they have to like you.   So be personable, relate to them.  HECK MIRROR them if you can.  I once wrote a loan at Quickenloans because the man thought I was a woman.  Seriously, I spent hours on the phone with the wife upfront and she knew I was a guy.  She just let me know how to appeal to the husband.  I never told him otherwise, he just thought I was a girl because I appealed to those wants he was looking for.  He found out after we closed, he he…

To get people to trust you on the phone use this technique to get them to like you, it’s called FORM… Family, Occupation, Recreation, and Motivation.  These topics can expand to other things, but is the root of what to talk about.  NEVER TALK POLITICS or RELIGION on a sales call.. Golden rule.  Now today appeal to those impulses sent to you over the phone or in person and address the prospects questions and concerns, paint pictures and respond with energy & enthusiasm.  TODAY I WILL POST A BUNCH OF OBJECTION RESPONSES TO MORTGAGE OBJECTIONS ON MY FACE BOOK GROUP.  My ask is to follow me if you haven’t already.

The Mortgage Juiceman Group

https://www.facebook.com/groups/MortgageJuiceman/

-The Mortgage Juiceman