As a home mortgage lender, you might feel that most of your clients are a “one and done” type of deal. You meet with the homebuyers, explain the ins and outs of their mortgage, organize their paperwork, set up a time to figuratively dot the I’s and cross the T’s and then — just when you learned their dog’s name and which sports teams they like best — you finish up your mortgage transaction and voila, they are never to be seen again.
But is this really the case?
Homebuyers: Worth So Much More Than a First Commission
In reality, those nice people you just helped with their mortgage could actually have a great deal of value to you over their lifetime. From returning to your company for their next mortgage and referring others to your outstanding service, to posting positive reviews about your company and more, the couple you just helped with their mortgage may bring you thousands of dollars of business over the next decade or two. To understand why this is the case, let’s look at some of the reasons in greater detail.
They’ll Be Back
Take a few minutes and think about the different places you have lived during your lifetime so far; chances are good you are not living in the home your parents brought you to right after you were born. In fact, according to the Census Bureau, an American may move about 11 times during his or her lifetime. Granted, this does not always involve buying a home, but chances are good that your clients may move again, and when they do, they will need another mortgage lender. If they have great memories of you and your services, you may very well see them in your office again, thus leading to additional commission money.
They’ll Tell a Friend, and So On, and So On
Another way that homebuyers will bring “value” to your company is through customer referrals. Happy customers are way more likely to tell their friends about their experience; on average, one satisfied customer will tell nine people about how much they like a company. That nice sports-loving couple probably knows plenty of other people who are in the market for a home and thus a mortgage; if they advise up to 18 of their closest friends and family members about your services, you could potentially end up with a ton of new business.
They May Also Be Active on Social Media
Homebuyers may also be extremely valuable to you, thanks to their ability to boost your reputation online — for instance, on social media. If you encourage them to “like” your Facebook and/or Instagram page, your clients will see the posts about your company and may share them on their own page. If the homeowners are in an online community group and someone posts asking about a great local home lender, they may post your name, contact info and company name and help generate new leads. This all boils down to free advertising and new business, all thanks to your happy homebuyers.
If You Switch Business Gears, They May Help You Get New Clients
Another way that homebuyers will show their “worth” over time is by helping you to get new clients should you ever go into a different field of work. If you stay in touch with the people you work with and foster a relationship that goes beyond the mortgage process, you may be able to call on them for referrals when you either a) switch companies, b) open your own mortgage-related company or c) branch out into a related field, for example, becoming a home contractor or inspector.
An Actual Mathematical Formula Backs Up These Points
Beyond these points that clearly show how and why a homebuyer can be worth his or her weight in proverbial gold over the course of time, there is an actual mathematical formula that will prove it. Called the Lifetime Value of a Client (LTV), you can determine the potential monetary value of a client. With mortgages it is a bit tricky to determine the LTV and you will probably find a number of suggestions on how to do it. Basically, you are taking the amount you will earn in commissions from one client and then multiplying it by the number of times they will be back for another mortgage and then factoring in other values. Mathematically, clients that come back again and again will have a greater lifetime value than those who do not return. To help determine which homeowners are most likely to refinance their home or use home equity lending, DataTree is also ready and able to assist; our homeownership data and marketing solutions offer “prediction scores” that will help you determine who is most likely to refinance their home, buy a house and other decisions related to home buying.
Nurture Each Client Relationship and Reap the Benefits for Years to Come
Clearly, every client who steps into your office has the potential to bring in thousands of dollars of business to you and your company. From repeat business and customer referrals to posting great reviews about you online and more, homebuyers have a great deal of worth that extends well beyond the existing mortgage. Do whatever you can to nurture this relationship and you’ll enjoy the financial benefits for years to come. Start your free trail with DataTree today to help put your new marketing practices to the test.