Generating Referrals:  Time and Effort

Generating Referrals:  Time and Effort

It's a fact: Referrals are a highly profitable source of business for mortgage companies and loan officers. Analyze and poll top producers and you'll find a significant portion of their business comes from referrals.


Regularly Review How You Spend Your Time and Effort

Time and effort are the most basic, assumed requirements for achieving any goal; but when it comes to business, the way you spend them are just as important as how much you put in. Successful MLOs are constantly aware of where their business is coming from and they regularly adjust to ensure they spend their time developing opportunities that have the highest return. Business planning season isn't the only time to make evaluations – a review of the following needs to be part of your routine: 

  • What's the potential for different business channels?
  • How am I approaching different entities?
  • How am I spending my time?
  • Who am I spending my time with?

Most Common Sources of Referral Business

It's widely assumed that referrals come predominantly from Realtors - and that may be the case for many MLOs. However, numbers from Ellie Mae's 2017 Borrower Insights Survey show that a significant amount of lucrative, coveted referral business come from areas other than real estate offices. View the full survey here. In response to the question, "What are the ways you found your most recent lender?", the three main demographics answered:


Referral Source

Friend or Family



Financial Advisor






Generation X





Baby Boomers





Average All Groups






The Realtor referral channel is definitely in the mix, but the average number of borrowers who took referral advice from friends or family and banks was higher. How do your referral numbers compare to the Ellie Mae survey? Are they commensurate with the amount of time you're spending with the various referral sources you're working? You may need to add certain activities to your weekly and monthly prospecting and business development activities, fine tune your existing efforts or both.


Building Relationships with Various Referral Sources

  • Realtors: Real estate agents will always be a viable business channel due to their constant engagement with consumers who need mortgage financing, but this source needs regular fine tuning. Assessing your return on investment (ROI) on a regular basis will help you adjust to ensure you're spending the most time with the most profitable relationships. Automated, compliant co-marketing that helps increase lead conversion also helps to build, strengthen and accelerate these relationships.
  • Friends and family: The friend and family referral numbers reinforce the case for consistent, relevant marketing to your post close and sphere of influence databases. Do you have relevant, fresh content planned for the next six to twelve months? Is it automated? Authentic, original content is ideal, but consistent touches that keep your brand in front of people still helps build trust and maintain your presence as a professional of choice.
  • Banks and financial advisors: These two sources can be worked similarly and simultaneously. Consider forging alliances with small, community banks and their wealth management and private banking teams. It's possible to co-market with this channel as well, and the invitation to do so can also serve as your inroad. Ask for industry news, current event analysis and helpful tips that you can use and quote in your newsletters and other outbound marketing - featuring them and their organization as a trusted expert. Once the door is open and the dialogue has started, share how your expertise with a particular consumer type they work with can solve a pain point for the customer and bolster the bank or financial entity's relationship with them as well. 

Closing Thoughts on Referral Business: Keep Yourself on the Radar

For someone to refer you, they have to think of you. The success of virtually every top producing, high-income MLO and Realtor is tied to the strength of their referral business. Determine which are the most profitable business sources for you today and adjust your activities as necessary to eliminate waste.

Make sure you have your plan, content and automation to help you execute so that you can expand into new territory. Consumers clearly take advice from others when it comes to choosing a lender. Delivering consistent and insightful marketing establishes you as an expert and keeps you on the radar for when the opportunity to refer arises. 

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