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johnnyboy38109
4357 Posts |
 Posted - 07/19/2008 : 1:38:47 PM
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Its not secret to us and now our customers how difficult it can be to obtain financing, and the economy is suffering under the weight of defaults, skyrocketing fuel costs, and rising food prices. Rising prices everywhere, really, and consumers' dollars are stretched more than in recent memory. Even a conservative existence is very expensive to maintain.
Use all this to your advantage.
Customers wlll be more receptive than ever to "cash-out" refinances, either to consolidate bills, refinance high-rate mortgages, get funds to do home repairs, or just to get cash for whatever purpose.
The problem is most consumers think financing for such projects these days is impossible. They see the news reports just like we do, and tend to carry the bad news to the extreme. They assume money is just impossible to obtain unless you have perfect credit.
Here are some very specific ways to make your pieces more effective and efficient:
1) Lead off your presentation in bullet-point style with a CASH-OUT offering and make the offering an oddball amount, such as $176,621 (adjust this if you want).....this oddball figure is done by design for no other reason than to cause the consumer to wonder why such an oddball amount would be suggested.
2) reference your loan product specifically by name..........backchannel me on this
3) mention your product is federally insured
4) make your pieces Pre-Selected or Pre-Approved....be careful here, there are many rules and regulations on this and you must comply. Dont be be tempted to suddenly make all your pieces pre-approved and risk being fined or closed. B/c me on this for more details.
5) give away gas cards with each close
6) set time limits on offers......."program expires "August 30th", etc....this would applyl to the promotion not to the loan program.
7) pay attention to WHEN your pieces are received.....
8) waive any upfront costs
This little bit of info will hopefully help some of you.
The good news for all of us that remain is our once-ravenous competition has become radically diminished, and there are still many high-rate deals on the books and FHA secure should keep us busy for quite a while.
Happy marketing.
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peter
6465 Posts |
Posted - 07/19/2008 : 7:15:35 PM
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Thanks, John, for the tips. I have designed my postcards
aiming at the cash out refi market but did not include the
specifics and the deadlines that you suggested. I am mailing
out only in hundreds for now as each postcard costs 27 cents
plus the cost of paper. Hope to fund at least 1 loan per
1,000 cards which would have cost me about $400 in total, and
just 1 point origination fee plus a modest rebate would have
paid for that. I doing the mailing about 200 cards per week
to each customer whose financial profile I carefully research
from mortgage transaction records provided by title companies.
I only do those with at least 30% equity or more which is
hard to find in California these days, like fishing for
a striped bass in a river full of infectious catfishes!
I shall be casting until my bait runs out.
Peter |
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ritabradley01
4945 Posts |
Posted - 07/20/2008 : 07:26:53 AM
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Thank you John for the great info!
Peter that's pretty amazing-a mail campaign on the cheap! $400 for how many total mailers? I'm impressed.
quote:
Originally posted by peter
Thanks, John, for the tips. I have designed my postcards
aiming at the cash out refi market but did not include the
specifics and the deadlines that you suggested. I am mailing
out only in hundreds for now as each postcard costs 27 cents
plus the cost of paper. Hope to fund at least 1 loan per
1,000 cards which would have cost me about $400 in total, and
just 1 point origination fee plus a modest rebate would have
paid for that. I doing the mailing about 200 cards per week
to each customer whose financial profile I carefully research
from mortgage transaction records provided by title companies.
I only do those with at least 30% equity or more which is
hard to find in California these days, like fishing for
a striped bass in a river full of infectious catfishes!
I shall be casting until my bait runs out.
Peter
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johnnyboy38109
4357 Posts |
Posted - 07/20/2008 : 09:38:13 AM
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quote:
Originally posted by ritabradley01
Thank you John for the great info!
Peter that's pretty amazing-a mail campaign on the cheap! $400 for how many total mailers? I'm impressed.
quote:
Originally posted by peter
Thanks, John, for the tips. I have designed my postcards
aiming at the cash out refi market but did not include the
specifics and the deadlines that you suggested. I am mailing
out only in hundreds for now as each postcard costs 27 cents
plus the cost of paper. Hope to fund at least 1 loan per
1,000 cards which would have cost me about $400 in total, and
just 1 point origination fee plus a modest rebate would have
paid for that. I doing the mailing about 200 cards per week
to each customer whose financial profile I carefully research
from mortgage transaction records provided by title companies.
I only do those with at least 30% equity or more which is
hard to find in California these days, like fishing for
a striped bass in a river full of infectious catfishes!
I shall be casting until my bait runs out.
Peter
You are quite welcome, Ms. Bradley. |
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ritabradley01
4945 Posts |
Posted - 07/20/2008 : 11:14:56 AM
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| Where do we buy your book Mr. Fowler? |
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Bob H
303 Posts |
Posted - 07/20/2008 : 11:15:20 AM
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There are 2 types of responses when it comes to direct mail. Some people respond to "fear of loss" and other respond to "seeking gain". For example, I am mailing 2 letters staggered 1-2 months apart to the same data. I send the official notice first looking for the fear of loss response. Response rate on that letter runs 1.5 - 2.5 %. Coversion rate is low due to many denials but still profitable.
The second letter I send looks nothing like the first letter whatsoever. People don't even know it's from the same company. It's a warm color straight forward offer. There is no mistaking what the letter's intent is and the response is very warm. I usually run about .75% to 1.5% repsonse on that letter. The conversion rate is higher so it is worth it.
By running my mail campaign this way, I get a crack at both types of responders. It is VERY important to run both strategies on each data set. Otherwise you are leaving money on the table. If I mail 10k records two times, my total cost is $7,300 for 20k dropped. Nowadays we will close about 8-10 deals on this strategy with an average fee of $5,000.
People who don't mail their data multiple times are making a huge mistake. People move in and out of the market for millions of different reasons. Timing is everything. I have several lists that I have mailed 4-5 times. Oddly enough, I will close more deals on the later mailings than the intial drop. |
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benjamin
6964 Posts |
Posted - 07/20/2008 : 12:27:32 PM
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| Thanks. |
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peter
6465 Posts |
Posted - 07/20/2008 : 6:24:30 PM
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Rita, I only mail 1,000 postcards per month and it costs
me $270 for stamps, with another estimated $130 for the costs
of postcard papers, printing ink out of my HP all-in-one in
black and white, as well as the cost of toner, etc. It does
not cost me more than 40 cents in all.
I get about 0.3 to 0.7 of 1 percents in calls, but upon
prequalifying the responders I often find them unqualified
due to lack of other qualifications aside from being equity
sufficient alone. So, I couldn't do most of the loans as
I do not want to waste my time and my paper processing
loan applications into oblivion -- or a pitiful exercise
in futility! Out of 10 responders, there may be 1 or 2
that are doable and I just have to take a chance to do them,
and as their true stories unfold they may not be the kind
of good borrowers that I had prejudged -- after reviewing
their credit and their documentation. People lie and are
not upfront with you all the time!
That is why I use the metaphor that the Los Angeles River
(indeed, there is such a river) is now full of infested
trouts and catfishes, and it is tough to try to fish for
a good striped bass due to the heavy pollution of the water
quality (And this is true about Los Angeles River). However,
you have to make do with whatever fish you can catch and
edible without contracting a fatal disease!
Hate to sound too realistic, but that's the way it is
these days!
Peter |
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