Wednesday, March 27, 2013

Are You the Cadillac or the Hyundai?

A man walked into one of the many Cadillac dealerships in Los Angeles to purchase a car. He was dressed in farmer's bib overalls, muddy boots and was less than clean shaven. The salesmen wouldn't give him the time of day much less take him on a test drive, fearful he might tarnish their sterling reputation. Since Los Angeles has countless Cadillac dealerships, the man walked a few miles down Sunset Boulevard into another Cadillac showroom where they not only offered him hot coffee with a smile, they invited him to look under the hood, kick the tires and go for a spin in more than one of the latest models. It turned out the man was one of the most successful farmers in the San Fernando Valley. That day he purchased not one, but two Cadillacs for cash he pulled out of the pocket of those less than perfect overalls and as he drove back to his farm he passed the first dealership with a wave wearing a satisfied grin. The moral of the story... you never know who you're talking to so always treat everyone the same and be at the top of your game. My grandfather told me this story many years ago and it's been one of those life lessons I'll never forget.
Being the best in the mortgage industry involves far more than getting the lowest rate and best terms for your client. It comes down to knowing your client's industry better than they do so the products you offer will serve them in the long run and bring them back to you time and again.
A loan officer called me recently with three multi- family refinance transactions in his area. When I didn't see the packages for over a week, I emailed him only to find out his client had relinquished the loans to his local bank. I explained to him that the local bank more than likely had only one option for the client and we had several different options including a 30 year amortization that the bank could not match. He went back to the client who indeed had been given only a 15 year amortization option from his bank and was delighted to have the cash flow nearly doubled with the 30 year option. In this case, being the expert really paid off since we could provide the cash out with an 85% LTV as well which the bank would not allow. The net tangible benefit for the client was substantial.
Sometimes saying 'I don't know' is not a bad thing. Being honest enough to say so but willing to go the extra mile is something I've found clients really appreciate. If you stop asking questions, you are not on top of your game and you stop growing your business. You can't know every product on the market but you can do the research on a particular industry to find niche products that will better serve that industry and profession so that you become the 'go to' person in your market. Research you area 'drivers'.
If there is an over- abundance of office space for sale, place ads in professional publications for doctors, lawyers and dentists. Know their industry and the specific things they look for in cash flow, what hurts it and what they need to grow it. Oftentimes they can get into an office building of their own for 15% or less down payment and they can have ancillary income from filling the other offices in the building with complimentary professions that feed off of theirs.
If you live near a college town or military base, self- storage is a key need for that demographic as they typically do not have sufficient storage. Market yourself to the self- storage facilities and offer product they cannot get from their local banks. Send out brochures offering longer amortizations and cash out for improvements such as new roads and RV parking storage if they have unused vacant land on the property.
In the last four years, I've driven past countless construction sites that have sat dormant since the onslaught of the recession. The next time you pass one of those sites, take down the number and call the developer. There are construction funds coming available again and you can offer the developer the opportunity to take his project vertical.
Senior Living is another market that is growing daily and requires niche expertise. Between assisted living facilities and senior care centers, not to mention the baby boomers coming of advance years, opportunities abound in the market.
So ask yourself, are you a Cadillac or a Hyundai?

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