Category: General

About a year ago, our marketing guy started posting goofy stuff on a personal Instagram account on a daily basis. His sources of material were either odd photos he took himself while out and about or something he found while cruising the ‘net. An example of the former would be a photo he took of a gas station sign that reads, “Fried Gizzards/Livers, Non Ethanol (Pump 11).” An example of the latter would be a meme that reads, “Another day has passed, and I have not used algebra once.” Sure, these aren’t the heady stuff being discussed by political think tanks or tested at Cal Tech to disprove String Theory . . . but he found that if he went more than a day without posting something, he was getting short messages from friends and “followers” asking him if he was okay – more importantly, they wanted to know when he was going to post another weird photo or snarky meme. Weird, huh?

So, a few months ago, he decided to try an experiment in the business arena along similar lines: he started creating small “ads” for the company and posting them throughout social media twice/day (once in the morning, once in the afternoon) Monday through Friday. The ads usually consist of a photo, a short headline, and sometimes a little text – and best of all, they don’t cost a dime to produce and post all over social media where the outlets are practically infinite. One of his particular favorites has a photo of two chickens pecking away at the ground with cartoon speech bubbles above their heads to indicate a conversation. The chicken on the left says, “I keep telling Carl to check into his VA eligibility for his mortgage, but he’s too scared to ask. He’s being such a ch. . . .” And the other chicken jumps in to finish his sentence with, “Child. I believe that’s the word you’re searching for. A child!” The headline reads, “You’ve EARNED your VA eligibility. We’ll make sure we look into it.”

After a month of posting these consistently, he would receive messages from different people if he hadn’t posted something by a certain time in the morning or the afternoon. Like his goofy posts on Instagram, he had created an audience and a desire in that audience to see something on a consistent basis. His purpose from the outset wasn’t necessarily to create a “fan base” but to create a presence for the company that made them recognizable and distinct – in other words, he did it strictly for branding. Once he got a sense that his ads were taking hold in the social media world and the Priority brand was established (at no cost), he started reaching out to agents who are a part of his selected audience and asking them for a few minutes of their time – and it’s worked. They’ve already gotten a sense of how different we are among mortgage companies from the messages and tones of the ads, so they’ve been more open to meet and learn what we can do for them. The meetings aren’t a sales pitch – they’re a planning session on how we can help that agent.

So, that begs the question for you as an agent: what are you doing to build YOUR brand? That question leads to a second question: are you doing it consistently? If you change your message and your image as often as a teenager changes clothes, you don’t have a brand – you’re perceived as a fad. Sure, fads make money, but brands make fortunes. Which do you want?

As you’ve seen from previous editions of this award-winning weekly newsletter, we have a guy in our office who always has an interesting story to tell – and this one doesn’t disappoint either. He has a brother who, when he was a wee lad, decided the family cat, Sam, was too dirty for his own good. The moment this thought entered his head, like the minds of most young children, it dominated every bit of his mental attention – he could do nothing until he had reached this self-appointed goal of having a clean cat. So, he dropped whatever he was doing – he could have been subdividing a sand castle he was building into affordable condos – and went off in search of Sam the cat.

Finding Sam, the brother scooped him up and trundled off to the family bathroom to give him a bath. (I know what you’re thinking: cats and water don’t mix; and you’d be right. Remember, though, this is a four- or five-year-old boy – those things don’t factor in his head.) As he neared the bathroom, the brother could hear that someone was already running the water in the bathtub. I’m sure the brother was thinking, “Great, someone else in this house is on the same wavelength. It’s about time!” With his hands full of cat, the brother kicked open the bathroom door to find a good steam building up in the room, and he made a beeline for the bathtub. This bathtub had a sliding glass-door enclosure, and it was closed. Shifting Sam as much as he could into one arm, the brother reached over and slid the door open, only to find his dad taking a bath. Unfazed, the brother – still holding the cat – looked at his dad and chirped a pleasant hello. His father, a bit puzzled, nodded to his son and said, “What can I do for you, son?” Without pausing, the brother said, “Sam needs a bath,” chucked the cat into the tub with dad, and closed the sliding-glass door.

While the brother had good intentions, he committed the same error so many adults commit every day: he failed to ask the next logical question. Instead, he made up his mind that he had the definitive answer and operated on the assumption that he was 100% right in his thinking. At Priority Lending, asking the next logical question has been one of the most fundamental factors that continues to set us apart. Two examples:

• A gentleman had gone self employed a few months before coming to us for a mortgage. He had been told by a number of other mortgage companies already that he had not been self employed long enough to qualify for a loan. We asked him a few questions – the same ones the other companies had asked – and then we asked him the next logical question: the answer to that question enabled us to qualify him for the loan he needed.
• A Registered Nurse came to us with a bit of a quandary: while she earned a very good salary, she had no money in savings for a down payment. We asked her a few questions – yes, one of them was whether she could get the down payment gifted, which she could not – and then we asked her the next logical question: and the answer to that question enabled us to get her qualified for the loan she needed.

Those are just two of MANY examples of how we’ve been able to make a seemingly impossible transaction have a happy ending. I’m not going to give away our secrets here – it’s always good to leave a little mystery in the relationship – but I can assure you that whatever weird or one-in-a-million scenarios you have, we’ll keep asking questions until we find a solution. It’ll be a lot easier, too, than trying to bathe a cat!

If I were to ask you, “What makes your mortgage company a good sales partner for you?”, your response would most likely resemble something like, “They do what they say they’re going to do, and they make sure the loan closes on time.” Am I close? Well, that’s a good answer – and an accurate one – but for a different question. That answer would fit better with “What makes your mortgage company a good service provider?” Do you see the difference?

The question first asked was about being a SALES partner – in other words, what are we doing to help you increase your sales? The mark of a good mortgage company is one that helps you become BETTER. In that vein, I have a piece of advice and an offer to help you become better.

The Advice
When NASA started sending folks up into the cosmos, they spent $12 Billion and ten years on developing a pen that would write upside down, at extreme temperatures, in zero gravity, and even underwater – and they did it. Meanwhile, the Russians addressed all of these problems in one fell swoop without spending $12 Billion: they used a pencil. Sure, it’s not nearly as sexy or as cool looking to put a pencil in your pocket protector, but it does the job.

What’s my point? Look for the simple solution – don’t get caught up in what’s shiny and new. If you happen across a new cell phone app that you find helpful, more power to you. But remember: you were an agent before that app came into your life, and that app can’t do what you do, which is sell. Whether you’re a part of a team, or you work independently, you and your talents are the most effective tools at your disposal – don’t surrender them to something that can ONLY be an extension of you!

The Offer
We have some shrubs in our backyard that have grown fairly tall, but they don’t look all that healthy. We read someplace that in the heart of the shrub, there are a lot of dead branches that keep the rest of the shrub from thriving. So, in order to bring the shrub back to a point where it has good, healthy growth, we had to get to the base of the shrub and start chopping away – in other words, we had to get rid of the dead wood. It was hard work and took time – time that would have been more fun eating nachos and watching a good movie – but it was worth it.

What’s the dead wood in your “shrubs” that’s impeding your growth? Not sure what it is? Let me give you a hint: it’s whatever that’s linked to your saying, “I need to get to that tomorrow”, but you never do. Whether that “tomorrow” item is a physical or a mental block, it’s a block. It’s certainly dead wood that’s keeping you from good, healthy growth.

Here’s the offer: Let us tackle the dead wood FOR YOU. We’ve done it for a number of agents, and they’ve seen measurable results of increased production. We can give you references – we’re happy to! Let’s sit down and talk about it TO MAKE YOU BETTER!

Yes, this week’s edition has something to do with Prince – I won’t lie – but let me assure you it’s not a schmaltzy tribute to him or a recollection of something that happened to me in my childhood that is forever memorialized by a particular Prince song. Actually, this week’s edition is about a Prince and a King – and by King, yes, I’m talking about Elvis Presley. Go with me on this. We’ll start with Elvis.

With a golden voice, Elvis Aron Presley sort of hit the genetic lottery: at the height of his success, he topped out at 6’0”, weighed a moderate 170 lbs., and had piercing blue eyes. He came onto the music scene when television was starting out, and the movie industry was really hitting its stride – something he and his manager, “Colonel” Tom Parker, were very wise to exploit. Selling the Elvis brand – not taking anything away from his talent or his manager’s finesse – wasn’t exactly rocket science. It was sort of like selling ice water to someone who just crossed the Sahara desert. Elvis released around 600 singles, had a boatload of #1 singles and albums, and snagged three Grammy awards – but he didn’t write a single one of his songs. No, not a one.

Born Prince Rogers Nelson, the artist commonly known as Prince, topped out at 5’2” and probably weighed 120 lbs. soaking wet – if you’ve seen some of his videos, you’ll know what I mean. Coming on the scene when image was already a HUGE part of selling your personal brand, Prince’s personal packaging left a bit to be desired, but that didn’t stop him. He garnered seven Grammy awards in his lifetime, an Academy Award, and had a very respectable number of #1 singles and albums to his name – and he wrote all of his own stuff. In fact, he wrote and collaborated on a number of famous songs many people don’t associate with Prince: “Stand Back” by Stevie Nicks, “Manic Monday” by The Bangles, and “Nothing Compares 2 U” by Sinead O’Connor, just to name a few.

While the success of these two men cannot be denied, their paths to these heights so few reach diverge quite significantly. Elvis (and The Colonel) chose to find other people to give him almost finished products to which he would attach his voice and personality – and that was a formula that had great results. There had to be many moments of stress and uncertainty, though, that Elvis experienced because he didn’t possess the ability to create his own music.

Conversely, not relying on anyone else, Prince not only controlled his own fate by writing his own songs, he lent his talent and creative energy to other artists – he reaped rewards from both his own music and the music of others because of that. I would imagine he experienced his moments of writer’s block, sure, but at the end of it all, he knew he had it in him to create something from nothing.

What type of agent are you? Are you a King or a Prince? Are you relying on your good looks and golden voice, or are you creating opportunities for yourself, regardless of how you look doing it? On a chessboard, perhaps there’s a reason the King can only move one space at a time while waiting for others to make their moves, and there’s no piece for the Prince – he’s off making a successful life for himself on his own terms rather than playing a game. That sounds like the right way to do it.

The title of this week’s edition is taken from a line from a song by The Ramones – it’s chosen for the irony, of course, because history is a great predictor of the future, and it can’t be ignored. So, find your seats and settle down. Thank you. Today’s lesson touches on the history of the interest rate here in the United States, and there’ll be a test later. No cheating off your neighbor.

• Early 1950s: interest rates were comfortably under 5%
• 1960s: interest rates were at 6% and starting to climb to 8% by the end of the decade
• 1970 to 1980: interest rates climbed to just over 12%
• 1981: interest rates peaked at just above 18%
• 2002: interest rates had worked their way back to 6%
• 2010: interest rates crept back under 5%

In economic circles (you should attend some of their parties – they’re real ragers), this is an almost picture-perfect demonstration of what they call the “60-year cycle”. With the economy being sluggish for the past five or so years, we’ve sort of bottomed out and held, but things are starting to look up, which means we’re starting a new 60-year cycle.

With that in mind, let’s look at a quick comparison for a 30-year fixed FHA loan for $200,000 with 3.5% down – monthly payment (PITI):

4% interest rate: $1,332.24
5% interest rate: $1,448.90 ($116.66 more than the 4% rate)
6% interest rate: $1,572.09 ($239.85 more than the 4% rate)

In the face of these numbers and this reality, a very wise man once said, “Buy your dream house now because you may not be able to afford it in ten years.” If you haven’t already run out to have bumper stickers and t-shirts made with this slogan, I’d highly recommend you do so just as soon as you finish reading this newsletter.

It’s not going to happen tomorrow, but we’ll be back up to 5% interest rates sooner than we think. The difference between a payment at 4% and 5% is significant enough for consideration – you’re looking at a yearly savings of just under $1,400 and an overall savings of almost $42,000 for the 30-year term.

Using history and the 60-year cycle as our predictors, it is very likely that we’ll be back up to 6% interest rates on 30-year mortgages in just ten years. That means that if someone were to buy a $200,000 house now, they will be able to afford much more house and keep their payments more reasonable. Let me explain it another way: in ten years, a $200,000 mortgage, at 6%, is going to cost $5,276.70 more each year, or $158,301 more over the 30-year term of the mortgage. Also, if home values increase an average of 5% each year, a $200,000 home that someone would be buying today would be worth over $250,000; conversely, what $200,000 will buy in ten years will be a house that’s worth just under $125,000 today. If you don’t believe me, do the math yourself. I’ll wait.

I opened with The Ramones. I’ll close with the Rolling Stones: “Time is on my side.” No, it’s not!