Building Referral Relationships for More Consistent Business

This piece originally appeared in the May 2024 edition of MortgagePoint magazine, online now.

Ron Vaimberg, President of Ron Vaimberg International, is an international success strategist, and one of the mortgage industry’s most renowned trainers and coaches of sales professionals. A former top producing loan originator and real estate agent, Vaimberg coaches both Loan Officers and Mortgage Brokers who have ranked in the top 1% in loan production, and have earned more than $1 million annually.

He began his career in 1984 as a real estate sales professional on the North Shore of Long Island, and in 1997, Ron created the New York Mortgage Institute, one of the nation’s first training programs for mortgage originators.

MortgagePoint recently had the opportunity to chat with Ron about the crucial business skill of establishing relationships in the mortgage landscape. Drawing upon his years of expertise coaching, he outlines strategies to properly build and cultivate relationships that will last for years to come.

Q: Why do you believe the dynamics of today’s market make establishing referral relationships more critical than ever for loan originators?

Ron Vaimberg: Developing relationships is ultra-critical in today’s market. First off, real estate agents handle 86% of all purchase transactions and have significant influence over where someone might go for financing, because they know who will get the job done and make the transaction go smoother. Everywhere you look, the most successful originators are the ones with the greatest number of relationships. They’re extremely profitable, because they are not paying an arm and a leg for advertising or lead generation.

Another reason it is so critical is that when interest rates drop, most mortgage professionals ignore their referral relationships to pursue the low-hanging fruit of refinances. If rates drop this year, real estate agents and referral partners will be abandoned once again. Our industry seems to never learn from this mistake.

But, originators who continue to develop relationships, regardless of what rates are doing, will continue to bring in a lot of business because their networks keep growing and providing them with more opportunities.

Q: What do originators most often get wrong about building referral business?

Vaimberg: The number one thing originators get wrong about building their referral business is they approach it from a selfish place. They are too focused on what they are going to say to a potential partner, and they end up talking about everything and anything they can do when it comes to financing. But that in itself does not make them unique. Originators need to think about their potential partner’s needs and master the art of asking great questions. I teach every one of my clients that the key to relationship building is not what you are going to say, but what you are going to ask.

When you ask someone the right questions, they will tell you exactly what you need to know to meet their needs and serve them and their clients. It is really quite simple.

Q: What is the most effective strategy for establishing and nurturing referral relationships with those in the industry?

Vaimberg: There is never just one strategy. The key is finding out what is most important to your potential partner. When you ask questions that uncover an agent’s pain points, frustrations, or the voids their current lenders have created, that opens the door. However, many loan officers lack a proper follow up. They leave their initial meeting without a real next step in place, or a strategy to stay engaged. Typically, they return to their office or their home, and wait for the phone to ring.

A few days go by, and nothing happens. They start thinking, “If I call the agent, they’re going to think I’m desperate. If I don’t call, they’re going to forget about me.” They start wavering, and eventually, most will pick up the phone and make that first call. But they are not really sure where to proceed, because they do not have a plan in place. This is why I have a very simple rule: Never leave a meeting or a conversation without knowing what your next step needs to be in order to move the relationship forward. The only way you establish that is by making it part of your initial discussion.

Q: Considering how competitive the market has gotten, how can loan officers stand out from their competitors when it comes to capturing the attention of potential partners?

Vaimberg: Make it easy for people to digest whatever you send them. We all have a reptilian brain that acts on instinct, like a gatekeeper. When we see an ad, text, or email, the first thing our brain does is ask, “Is this relevant to me?” If it is, the brain starts gathering more information. But if it does not pass this relevancy test, the message dies on the vine. Many people think the critical part of their message is the details, but the details are only important if the headline and first paragraph passes the relevancy test, which happens when you address the recipient’s frustrations or fill a void right up front.

Messages must also be timely and repetitive. Too many salespeople engage in what I call “one and done” marketing campaigns. They do something once, it does not work, and they never bother to evaluate exactly why it did not work. Many think there is a problem with the message or idea, but there are many great ideas out there, and they all work. Very few, however, look at how they executed the idea to see if they are doing it right.

As a coach, I see this all the time. I give my clients specific guidance on how to execute something. When we have our follow-up coaching call, and they provide the results, I can immediately determine whether they came close to executing what I asked them to do and show them why they got the response they did, versus the one they should have seen. That is because they changed the format of what I asked them to do, but they did not realize what they had done to the message.

Q: Can you share some creative tactics that loan officers can use to overcome objections from real estate agents, and turn them into opportunities?

Vaimberg: The first key thing is to understand where the objection is coming from. Real estate agents often say, “I have an existing relationship,” “I have an in-house lender,” or “I only do listings.” They say this strictly to dismiss a loan officer, and they know it works really well. It is possible that their reasons are legitimate, but you must prepare for them in advance, which very few loan officers are willing to do.

The way to overcome these objections is to show how you solve a problem for them or create an opportunity. So, you need to have a question ready. For example, if a real estate agent says, “I have an existing relationship,” try saying, “I appreciate you being honest with me. I expected that you already did. The reason I am reaching out to you is …” and then insert the purpose for your call. It could be as simple as, “I was hoping I could ask you a question.” I teach my clients this, and it works like a dream.

We are conditioned to answer questions. It is almost a reflex for most, and if you have a question ready that sets up the purpose of your call, it becomes much easier to gain and keep someone’s attention.

Q: What do you find most real estate agents want in their referral relationships with loan officers?

Vaimberg: The number one complaint agents have about loan officers is communication. In the many decades I have been in the industry, that has never changed. However, you cannot simply promise to communicate better—your potential partners have heard that before.

You need to establish your communication system by asking a series of questions. For instance, when speaking with an agent, you might ask, “Do you ever encounter issues with the loan officers you work with, like a borrower choosing different financing? How is communication handled in those situations?”

Most times, the agent will express their frustrations, such as lack of transparency or not knowing the status of transactions. You can then follow up with, “Have you ever had a mortgage professional outline their communication process to ensure you’re always informed about the trans[1]action’s progress?” They may say “yes,” but more commonly, it is “no” or “what do you mean?” This is where you set up your solution.

Asking the right questions is crucial in sales—questions that not only set up the solution you want to discuss, but also identify if there is a genuine need for it.

Sadly, it is a skill that many loan officers lack, which keeps them from expanding their referral relationships. But with the right guidance, they can learn to overcome it, and when they do, their ability to grow business is practically unlimited.

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Eric C. Peck

Eric C. Peck has 25-plus years’ experience covering the mortgage industry, most recently serving as Editor-in-Chief for National Mortgage Professional Magazine. He graduated from the New York Institute of Technology, where he received his B.A. in Communication Arts/Media. After graduating, he began his professional career with Videography Magazine before landing in the mortgage space. Peck has edited three published books, and has served as Copy Editor for
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