This week finds me back fresh from a mortgage symposium in Ottawa. Meeting this time was in the aviation museum.

My two favourite things all wrapped into one.

I’ve mentioned this before. There is just something about meeting with lenders and reviewing their portfolio offerings that causes the creative juices to flow.

Staring at an F-18 for an hour is also pretty cool. Lean mean fighting machine.

I’m sure there’s an analogy here or two or three.

Well there was no B-52 or even a B-17, but there was one massive Lancaster bomber on display. One bomber or “B” class of note on display and magically also one “new” B-lender on display. I hadn’t a clue who VLC was. Fortunately the district manager showed up with some info and caught me by surprise. Self-insured (i.e. not CMHC/Genworth/AIG) and willing to go to 90%. Golly! How about bankrupts and folks in proposal? Bankrupts with established credit 85% or 80% with no credit, with no 2 year waiting! Folks in proposal, they will use the clean payment history of the proposal as a form of credit … wait there’s more…. they will also consider doing a refinance of your property in order to payout your proposal. Likely lower your overall mortgage rate (most of them today are in the 12-14% range with HLC or HSBC), thus give them some cash to live on. Now wouldn’t that bring a smile to good hard working stiffs that just need a break.

To me at least that was quite the “bomb shell”. Now if I could just get that paramedic who dropped into the office one day to call me I could offer him a solution. At least I gave him my card. Maybe he’ll call and ask a question.

The “stage” was set up right beside a beautiful Challenger Jet. An absolutely magnificent plane. I kept staring at this aircraft while the panel discussion was going on about how to package up commercial deals. I kept thinking most of the people here are probably to scared of the “unknown” to even think about attempting a commercial deal. Personally, I just see it as a “challenge”. More work, more documentation, more effort, longer closings, more hoops to jump through, etc. But the payoff is also 4 times as large. Right now for me, it’s the icing on the cake. I imagine building a business of commercial deals and start to think, maybe I could one day afford not just to ride in a challenger, but afford to buy one. (Ok, so I should really check the price of a small personal jet and maintenance costs, but if you’re going to dream… why not dream BIG).

I guess there are other war analogies, like much of the time I feel like I’m in the trenches trying to get deals done. I get this one sweet deal and try to make it “fly” only to get shot down by a lender. Or all the new strict documentation requirements are like flying through flack. Dangerous as there is real potential the ‘flack’ could take you out of the sky.

They also had a couple “sections” of he Avro Arrow. Sorry, but I just have to draw a comparison to Nortel at this stage. Government has done nothing to protect one of it’s key critical assets and now it’s being sold off in parts to different companies around the world. Will folks look back on Harper like they do Diefenbaker?

How about Spitfires or the P-51 Mustangs. Lean mean fighting machines. Comparisons? I guess the brokers who have been in the business for 10+ years. They know how to handle themselves in a dog fight and get deals done. They have weapons at their command and know how and when to use them. I guess their assistant would be their wing man.

So many planes…. so little time.

I’ve signed up for a free 2 month “we’ll help you with marketing your mortgage business” company. I’m thinking of doing a pre-(this post) and post (later post if that makes sense) of what has changed and how my closing ratios have changed. I’ll assume they will as my marketing effort so far has been a little lacking.

So mark your calendars. Let’s say Halloween time frame for an update.

The price was right, except they like all other marketing and sales companies always want to up-sell you on the next level (or two or ultimate super duper package). The understand the game. Give stuff away and the law of reciprocity says you’ll give back by buying something later.

Now it’s a two month program. Of course the first thing I get in the mail is the “we’ll double your income and double your time off…. in 90 days” CD/DVD package. Does this mean in only 60 days I’ll only get 66% increase and not a full doubling? Or they are just assuming I will like the program enough to pay for the extra 30 days?

Ok, I’ll have to admit I’m (we, my wife & I) a little skeptical, leery, doubting Thomas, really don’t trust the whole ball of wax. Why? Well, let’s just say once bitten (hard I might add), twice shy. At the outset all I can see is everything that made the previous experiences really bad.

It seems to always start with the pressured pitch. “You need to act now in order to <insert item of potential critical nature>”. Either it’s days to something starts, limit time offer, only so many seats available, special extension that wont last forever… you’ve heard it all before. It used to be operators are standing by now it’s “click here” or we’ll put you in touch with one of our “certified” trainers/mentors. “Don’t you know, professionals use mentors. Amateurs think they can do it themselves.”

Yep. Yawn. Can we just get to the guts of the program. Oh, wait there is no guts? Just little tidbits to wet our appetite for more? All we have to do is sign up for (yet) another course?

You can fool some of the people some of the time, but marketing will let you fool all of them at least once.

Should I name names of companies who I’ve either dealt with or have spoken to others about who have the same experience? How about last names to avoid slander. Allen, Whitney, Hansen… Generic enough names, right?

Why do I have at least some glimmer of hope for this “new” marketer? Let’s just say, he appears to be walking the walk. His first thing is he says we need to specialize. OK, what’s he doing? Hm. Really tight market focus. Mortgage brokers/agents/originators. No one else. Just us. Next, offer some information to clients for free and at the same time capture their information. Hm. Let’s see, he’s been emailing me for about 3 months now and made an offer to give me 2 months coaching free.

He’s all about client retention. The best way I’ve found to do this is by creating some kind of forum where people can provide feedback/suggestions/ideas to move forward. He has an online forum of (he boasts) 1800 mortgage professionals. The theory is the experienced folk are there to help answer questions from the newer generation. Some good discussions on the group, however if that many really are “signed up” I would think there would be a whole lot more Q&A. Brokers tend to be a private bunch as if you give too much info, some one could potentially poach your deal. Banks are notorious for doing just that.

From the book, “what would google do?” The main concept is to provide a platform on which you allow others to build new and exciting things. The ones that get it understand it is a collaborative effort (together everyone achieves more) and they work with their customers to improve products in ways which help improve their lives.

I guess if he believed in the power of Google, he would offer this services and website creation/content for free (all of it) and use Google to fund everything through advertising. I think the bigger challenge is to find a community of potential buyers and find out what they want out of a mortgage lending company and work towards becoming that company. If the service is there, then the clients will pay more to get what suits them best.

If there isn’t such a community, then how would one go about creating and attracting people to such a group? Our services (for the most part) are already free. We try to do our best to match your needs to what the lenders are offering. Unfortunately there isn’t a whole lot of variety amongst the lenders (except maybe FirstLine, see post a couple weeks back).

So that’s my slightly tainted view, from past experience, to the start of this new venture. I have a “coaching” call next week, where “my personal 1 on 1 coach, will reveal to me exactly where my current problems are, fix these issues with some generic tool.” I’ll be so impressed that I’ll want to sign up for the weekly coaching sessions as I’ll see the immediate value from the first 30 minutes.

I’m sorry, but I just can’t avoid being sarcastic when I talk about marketing. It’s the engineer in me rebelling. I’m the logical A to B guy. Start at A. Do the following. You get to B. With marketing, it always seems to be we’ll get you there better/faster/shorter all you have to do is believe, we’ll take care of the rest… for only $xxx/mo.

I’m willing to try. They seem to have specific knowledge of the business. I’ve really got nothing to lose for the next 60 days. Something will likely spark my own creativity. If I manage to even close 1 extra deal a month it’s paid for itself.

Wish me luck and feel free to share your marketing experiences.

There’s been a not so subtle shift in the industry this year.

It started with the tightening up of requirements from lenders. It then moved to documenting proof of not some but almost all items stated on the submitted applications. Next they’ll be asking for birth certificates. “We don’t believe you were born.”

It used to be I could call and explain a situation to an underwriter. We’d have an agreement in principle IF I could supply some kind of proof of the story. Now we have deals where I can offer an explanation, but that doesn’t matter. If I don’t have a square peg in a square hole the deal is likely not going to get approved. The decision making has been taken away from the underwriter and give to “risk management”.

Today if there is anything out of the ordinary with a file, I might as well call up Home Trust and negotiate with them. They are the only, what we call in the business, “equity” lender still left in Canada.That’s right. ONE.

When I started in the business, they referred to Home Trust as the lender of last resort. At the time, we had B lenders or sub-prime lenders coming out our ears. Something wrong with the file? Go to lender X. Only after finding out lender X wouldn’t do the deal would you consider HT.

Now lenders B through X have all disappeared (at least from accepting broker deals). Leaving me with the option of someone who doesn’t quite fit an A lender requirements to go to HT or as a desperate measure a private money lender.

Now HT has moved forward and have decided they want to play in the A lending space, blurring the line even more. They too have limited where they lend… major urban centers was the last line I was told.

Strange how I find that the B deals I find are almost never in a major urban center.

I have no proof yet, but I get the feeling private money lenders have seen a major increase over the last while. I know one company that started up a little over a year or 2 a go by two former bankers who knew what a good deal was and how to work with clients to solve problems. They understood that bad things happen to good paying customers and that sometimes things get better if you can just solve a problem for a short while until they are back on their feet. Oddly enough they understand that they have to pay a higher rate for a short term until things are cleared up. Put these folks into homes (or more likely keep them in the one they’re in) rather than force them out and offer up countless explanations to landlords who likely will see them as a risk as well.

The common sense lending is gone. Along with it the trust factor. Trust of just about anything. From lenders not accepting government documents because the fax machine slightly altered the document, to the outright non-acceptance of letters from lawyers stating they have funds on hand for closing/downpayment. “Where did the lawyer get the funds from?” He’s a lawyer. Won’t he be disbarred if he commits fraud? Yes, but we still want to know where the funds are coming from. I’m sure it’s coming from that drug dealer he knows that funds most of his practice.

I love that joke. “99% of the bad lawyers are given the 1% of good ones a bad name.” From one lender it seems there have been a few lawyers who have been willing to take a large sum of money to sign a letter which wasn’t exactly truthful. Rather than cut off certain firms one at a time or create a list that everyone shares (Hm. like they do with brokers, called RED-X, which we have no input, but that’s another topic for another time), they simply state that they don’t accept letters/confirmation of funds of whatever from all lawyers.

And yet they still are willing to let these same lawyers close the deals. Hm. Do you think that these same lawyers that were willing to sign for cash might be able to come up with another way of making money out of the deal? I guess because lawyers are professionals they can’t be blacklisted.

So much for having a silent joint venture partner on a deal. I think the only way left now is to have a corporation with shares purchase by the partner, of course they can’t have voting  or majority shares.