How To Get Paid $100 For Each Prospecting Call You Make

I’ll never forget what a sales trainer said at a conference I attended in my first year of real estate 14 years ago.

He said, “The best thing about real estate is that you are your own boss and there’s no accountability; the worst thing about real estate is that you are your own boss and there’s no accountability.”

Bing!  A bell went off in my head that day.

We must bring oversight to our activities and develop an effective regiment – a daily routine – that serves our goals.

This is true for all self-employed business owners, including (especially) mortgage loan originators.

Start with this question: if you were your boss (and you are, actually), when it comes to business development would you be getting fired or getting a raise?

Well you don’t have to technically fire yourself if you’re doing a poor job in the business development category because your sheer lack of income will do this for you.  The opposite is also true: the raise comes as you become more consistent and effective in your business development activity.

One of the most effective ways you can become more comfortable with prospecting is by turning it into a financial game and dollarizing your activity.

How To Go From Amatuer To Master MLO Rainmaker

Getting good at prospecting and lead generation takes 2 things: 1) experience; 2) the right attitude.  And by the way it’s about 90% attitude.

By dividing your business development milestones into your monthly income, you can see exactly how much your activity is worth.  When you do this, the activity gets framed in a new way – a more exciting way – and can cause a shift in your attitude towards prospecting.

Here’s an example.

Let’s say you want to earn $250,000 over 12 months or $20,000/month.  You earn 100 basis points and your average loan amount is $200K.

That means your average commission is $2,000, which means you need to close 10 loans a month to achieve your monthly income goal of $20K.

With that info in mind, what is the activity in the preceding months that will convert your monthly transaction goal?

Let’s break it down.

In my experience, a good conservative ratio of apps to closings is 20%.  In this case, you need 50 new applications going each month to close 10 deals consistently.

The next question is, what activity do you need to execute to generate 50 loan apps/month?

This is going to be different for everyone but here’s a plausible scenario:

  • 20 realtors who refer on avg. 1.5 leads/month for a total of 30 apps
  • 5 bankers who refer on avg. 2 leads/month for a total of 10 apps
  • 5 past client referrals or past client refi opportunities for a total of 5 apps
  • 5 referrals from a BNI group for a total of 5 apps

The realtors represent 30 out of 50 apps, or 60% of the apps you need to take each month to achieve your goal.  So in essence, realtor referrals represent 60% of your monthly income goal, in this case that would equal $12,000.

Let’s break it down even further to achieve a dollar value for your realtor prospecting activity.

Okay.  So you need 20 realtor relationships that send you leads.  If you divide 20 realtors into the $12,000 of monthly income their referrals yield, each realtor relationship is worth $600/month! (Note that the bulk of your referrals will come from a handful of agents, so you need to track where your leads & closings come from to ascertain who are your most valuable referral sources).

In my experience on average if you prospect realtors for 1 hour, you’ll make 6 contacts, set 3 appointments, go on 2 appointments and 1 of them will become a new referral source.

So if 1 realtor relationship is worth on average $600/month, then if you go on 2 appointments to get that 1 relationship each appointment is worth $300!

If each appointment is worth $300, and it takes 6 contacts to yield 1 solid realtor referral source, then each contact is worth $100!

Do you actually get paid the $100 in this case for making the call?  You bet your a$$ you do; but understand the payment comes after you do the work in about 60 or 90 days.

So let’s reframe your prospecting inside this new scenario.

The Mindset (Attitude) Shift That Makes You A Fortune

Now when you go to pick up the phone and you’re feeling nervous about the call, you can remind yourself that if someone answers on the other end of the line and you have a conversation with that person it will be as good as putting $100 in your pocket!

So literally, the conversation in your head before you make the call shifts from “Ugh…I hate calling realtors! It feels awkward…they’re so busy…they don’t want to talk to me…they probably already have a lender…they’re going to blow me off…this is so embarrassing…blah blah blah…” to: “Ooh!  I hope he picks up!  Sure this feels a bit uncomfortable but what the hell – each conversation is worth $100 and gets me closer to my income goal!”

Completely different energy.  You’ve turned it into game that you play.  You come to the office, punch the “prospecting clock” for an hour and get to play a fun little game.

Changing the dynamic by dollarizing your activity is a smart way to shift your mindset about prospecting and “show up for work” everyday!

So, what are your contacts worth?  Download the Prospecting Dollarizer, fill out the 1 page sheet with your numbers and share what your contacts are worth in the blog comments.  (Click here to view a 3-minute tutorial on how to use the Prospecting Dollarizer).

 

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