Growing Your Pipeline
Building your pipeline and keeping it full is critical to your survival in this industry.
Girlfriends, Building your pipeline and keeping it full is critical to your survival in this industry.
What happens though is we get busy handling all the business we have, and we do not spend time on new business. If you do not have any extra time that you are willing to spend on building your pipeline and you want to build your business and be successful it is time for an assistant. So, let’s talk about ways to build your pipeline.
- Have a plan. You absolutely cannot grow your business without a solid written plan on how to get there. The first step is to calculate how many referrals you need to close the number of loans you would like. If you want to close 10 loans a month (this math works for whatever number you set) determine where they are coming from and what is your closure rate.
For example, if you want your business in the following ratios, 60% Realtors; 25% Database; 10% Business Partners; 5% marketing, then you need 6 loans from Realtors, 2 from your Database, 1 from Business Partners, and 1 from your marketing efforts. If you convert 15% of referrals to loan applications and then close 90% of those you would need a total 75 referrals per month to reach 10 closed loans (75 referrals x .15 x .90). You will need to know what your conversion rate is (hopefully you have been tracking your referrals and you can figure out how many converted into loans and how many you closed). To work it backwards take your percentage of conversion and close percentage and multiply those two numbers (in this example, .15 (15% conversion) times .90 (90% close rate) = .135) Then take the number of loans you want to close per month and divide it by that number to get the number of referrals per month required. Using the same example divide 10 loans (goal) divided by your percentage needed (.135). Take 10 and divide by .135 which equals 74.07. Therefore, you need 75 referrals per month to close 10 loans. Again, figure out your personal closure rate.
2. Prospect. Continuing with the same numbers, we need to close 6 loans a month from realtors (based on our goal of 60% of our business comes from Realtors), so using the same percentage ratio (the more sophisticated you get in your tracking the conversion rate may be different for your different categories – however for now we will use the same conversion rates. Therefore, you will need 45 referrals from realtors each month. You must decide if you want to call on 45 realtors and get 1 referral a month or find 9-10 producing realtors that can give you 5 leads per month. One day a week (I suggest Mondays) spend two hours on the phone calling Realtors with no interruptions. Your goal is to schedule a 30-minute sit down meeting with them and find out their goals. If they only close one or two homes a year, they will probably not get you to your goal and you only have so much time per week. You can make an exception if they are new, and you want to be their preferred vendor and you feel they have great potential. Once you decide their goals align with yours you will add them to your A list.
You are to call them every week. You will not talk to them each time, however, you can leave them a message, that entails a loan update, new products or follow up on a personal matter. Your goal is to stay in touch with them and make sure they are sending their referrals to you. In this business out of site is out of mind. You also need to meet with your “A list” once a month, in a group setting and at least once a quarter on an individual basis. The group setting could be a Happy Hour, Coffee meeting, or a Lunch and Learn. Quarterly, you need to meet one-on-one and go over their goals and make sure they are on track. If you calculated they should be sending you 5 leads per month and they are not, you need to find out why. Are they sending them somewhere else, or have their goals changed and they are not really working that hard? You need to ask tons of questions, do not let them give you a standard answer like all my buyers are paying cash, or they all have other lenders. If they are not sending them to you, find out why.