For years I have listened to colleagues in the mortgage profession complain that they “lose” clients because their rate or price is too high. Yet, they fail to recognize that another advisor in the same office, in the same market, with the same price, is converting and closing more clients on a regular basis. So it isn’t about price.
Prospective clients are seeking value. But in the absence of any unique value, it absolutely will be about “lowest price”.
People are seeking a unique experience. They appreciate value. If this wasn’t a fact, then Nordstrom’s would have been out of business long ago and the only place people would shop would be Walmart.
People are searching for someone to help them achieve their goals. They want to own their first home, or invest in a 2nd home at the coast. Perhaps they want to remodel their kitchen or utilize some of their equity to help their children pay for college or consolidate high interest debt. Providing solutions to these things is hugely valuable.
People need someone to help solve their problems. Often a client will come in to get pre-qualified to buy a new home, but is unsure how much they can afford, or how to overcome a lack of down payment. But perhaps they are struggling with problems they don’t openly share, such as not filling up their 401k at work, or the inability to save money each month, or the lack of a plan to pay off their consumer debt. When you can identify problems they don’t even realize they have, and then provide solutions, you will quickly see how little price matters as long as you’re competitive.
Here is a tip I share with my Loan Officers regularly: If you are spending more than 30 seconds trying to explain “your rate” versus a competitor’s rate, you are missing the boat.
Teach them how rates work. Explain that everyone is getting money from the same place. Show them your pricing engine. Educate them on the value of knowing WHEN to lock, rather than what today’s rates are before they even have a house picked out. Provide transparency.
Don’t be a victim to price. Don’t allow yourself to make excuses for why clients
are choosing to work with someone else over you. Work on yourself. Improve your process and your value to others. Go deeper on the real problems they face financially and build solutions. Give them something so valuable they’d pay almost anything.
It’s your choice whether you want to be the Walmart or the Nordstrom in your industry. But don’t try to tell me you don’t have control over this decision. And if you’re surrounded by people at your company who think this way, it’s time for a change.
