EVERYTHING YOU WANTED

TO KNOW ABOUT

SUCCESSFUL ONLINE

MORTGAGE ORIGINATION

BUT WERE AFRAID TO ASK

Must read information on sourcing site visitors, meeting their

value proposition, and creating ‘sticky’ experiences to keep

them engaged - A quick ‘how to’ guide on establishing and

growing scalable internet mortgage origination.

Consumer Direct

Mortgage Marketing

From A-Z

1 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

Contents

Foreward ..................................................................................................................................................... 2

Online Mortgage Origination Part I: - Sourcing Site Visitors .............................................................. 3

Traffic Aggregation Models .................................................................................................................. 3

Aggregating Site Visits .......................................................................................................................... 3

Self-Sourcing Site Visits ......................................................................................................................... 4

Self-Sourcing Site Traffic – Required Skill Sets .............................................................................. 4

Hybrid Aggregation .............................................................................................................................. 4

The Dance You Must Learn - The Consumer Direct ‘Two-Step’ ..................................................... 5

Creative Process ................................................................................................................................. 5

Online Mortgage Origination Part I: - Sourcing Site Visitors, Summary ........................................... 6

Online Mortgage Origination Part II: - Today’s Online Value Proposition ....................................... 7

The Consumer’s Search for Exclusivity .............................................................................................. 8

The New World of Validated Offers ................................................................................................... 9

Providing Validation on a Local Level.............................................................................................. 10

Converting to a Validation Model ..................................................................................................... 10

Referral Sources and the Validation Model ..................................................................................... 11

Online Mortgage Origination Part II: - Value Proposition, Summary ............................................. 11

Online Mortgage Origination Part III: - The Art of Being ‘Sticky’ .................................................... 12

Four Considerations to Effect a ‘Sticky’ CRM .................................................................................. 12

Timeliness.......................................................................................................................................... 12

Relativity ........................................................................................................................................... 13

Validation .......................................................................................................................................... 13

Call to Action .................................................................................................................................... 14

Measuring Consumer Engagement ................................................................................................... 14

Knowing When to Act ..................................................................................................................... 14

Online Mortgage Origination Part III: - The Art of Being ‘Sticky’ - Summary ........................... 15

Online Mortgage Origination Part IV: - Scaling Your Online Generation ....................................... 16

2 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

Foreward

The following pages represent over twenty years’ experience in mortgage internet marketing

and online origination. One could certainly write entire books on the individual concepts of

sourcing site visitors, meeting their value proposition, making the site visitor’s experience

‘sticky’, and creating scalable online origination.

While each of these topics is addressed herein more time would be required on both the reader

and the author to affect a truly comprehensive piece on each. Therefor what follows is the ‘short

hand cliff notes’ to each respectively. The intention is to create a useful reference for your

purposes and, hopefully, to pass on more of a success strategy and less of a cure for insomnia.

Adam Stein,

CEO, LoanTek

3 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

Online Mortgage Origination Part I: - Sourcing Site Visitors

Traffic Aggregation Models

Obtaining site visitors is the starting point of any online campaign. Simply put, without traffic

(site visitors) there is no online origination. Traffic aggregation is no easy task; it has gotten

easier, however, with the advent of social media, Google AdWords, blogging, mortgage tables,

and other forms of lead generation that generate online referrals. When considering how to

drive online traffic there are three paths a lender can take: aggregating, self-sourcing, and

hybrid aggregation.

Aggregating Site Visits

For most lenders the aggregation model is the easiest to adopt and manage. Aggregating site

visits and leads from third parties is more effective, time and cost efficient, when compared to

the average lender’s technical abilities. There are an abundant number of third party providers

that can provide the lender with site traffic and leads. The aggregation method is therefore the

easiest and most oft used starting point to create online origination. While the process of finding

the consumers you want may have just gotten easier the process of evaluating and optimizing

your results are very similar to the self- sourced model. You will still need a few tools to

manage, optimize, and measure your marketing spend: Google Analytics, landing pages, and

lead management.

There is a reason that the top online aggregators like Bankrate, LendingTree, Trulia, and Zillow

exist – they’re experts at the generating mortgage traffic and they command large streams of

revenue by aggregating site visitors and rerouting them to their advertising partners. The

primary difference between self-sourcing traffic and aggregating traffic is this: you are paying a

third party for referring their traffic to you and, or, converting this traffic for you (leads). There

are two types of aggregation Pay-Per-Click and Pay-Per-Action.

Pay-per-click is similar to the prior self-sourcing avenues in that you will still need

effective landing pages that convert these visitors efficiently

Pay-per-action is, by any other name, a lead that has been already been converted.

4 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

In either case the answers to ‘how many clicks to a lead?’ and ‘how many leads to a funded

loan?’ will determine whether the funds invested in the respective aggregation channels are to

be nurtured or diminished (See ‘Feed or Bleed’ later in this section).

Self-Sourcing Site Visits

Self-Sourcing Site Traffic – Required Skill Sets

The primary fail point of the self-sourcing method is that most lenders do not adequately

pursue this method to achieve successful results; those that do, however, are richly rewarded.

Self-sourcing site traffic can be done effectively but the

tasks and skills to accomplish the end goal are no laughing

matter. There are two key steps to successfully self-source

mortgage originations online: create an engaging website,

or landing page, that converts optimally, and; determine

where you drive traffic from (Google AdWords, Facebook,

Etc.,). What follows is a short list of the skills a lender will

be required to possess, hire, or contract, to create an

effective self- sourced campaign:

- Copy Writing– the ability to write concise marketing that will create engagement

Graphic Design & Web Design – the ability to create imagery and landing pages that

will use your content to convert clicks to actionable consumer records

- Content Writing (Blogging) – the ability to regularly create and post unique content.

Specifically, content that meets the value proposition of the consumer and creates Search

Engine Optimization

- Managerial Accounting – the ability to measure the expense and conversion of your

overall consumer aggregation model and manage the results accordingly

Hybrid Aggregation

Hybrid aggregation assumes two basic concepts:

You have successfully implemented either self-aggregated or aggregated traffic; and,

You are profitably managing these and you want to increase you sales opportunities.

Congratulations on having reached this point! By revisiting the applicable section above you

can grow your site traffic model to its fullest potential. You have already done half the work by

this point and acquired the basic skills to measure your expense and conversion ratios. With a

little more work and creative design you should be able to affect internet traffic at the highest

volumes possible.

5 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

The Dance You Must Learn - The Consumer Direct ‘Two-Step’

Independent of how you create your site traffic there are two required processes to launch an

online campaign; one must create website collateral (landing pages) and also the ability to track

the traffic and resulting conversions (Google Analytics and Lead Management). Some tips on

managing this process are detailed below:

Creative Process

1. For optimum conversion you will need to design very specific landing pages. These

pages should be designed to convert traffic from a specific source. To make certain that

the “final landing page” is not wasting your marketing dollars by performing poorly,

you will want to create more than one page for comparison data. This process is called

‘A/B testing’. By creating a number of pages with unique content, imagery, and page

design you can effect A/B testing.

A/B testing is then the practice of producing multiple landing pages and studying their

respective performance. By looking at a given landing page’s conversion data, and

comparing its performance against another, one

is able to create an optimum landing page that

leverages the strengths of each. Implementing

A/B testing will allow you to create optimum

web designs and content solutions convert to

the highest number of leads per site visit.

Managing Marketing – ‘Feed or Bleed’

2. Once you have developed the optimum landing page use a ‘Feed or Bleed’ budgeting

process on the sources of your site traffic. Simply put, use Google Analytics to assess

where your marketing dollars are working (Google Analytics is free – I like free). Using

the data from Google Analytics ask questions like: ‘How much traffic is being referred

from ‘X’? ‘How many leads are resulting from the landing page per visit?’ When you get

down to it these are the only things that matter: how many visitors did I get for my

marketing dollar and how many converted to leads? The first question is a topline

benchmark of your marketing dollar’s efficiency with the given traffic source. The

second question is more related to the effectiveness of your creative page, content, and

quality of the traffic being referred:

6 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

Does my page meet the site visitor’s value proposition? And,

With respect to the quality of the traffic being referred: are the site visitors coming from

‘X’ predominantly home buyers looking for financing – or are they ‘garbage clicks’ with

high bounce rates?

The answers to these questions will dictate which traffic sources to ‘feed’ and which source to

‘bleed’. They will lead to the effective management of your marketing dollar and the cost

efficient production of online consumers.

Online Mortgage Origination Part I: - Sourcing Site Visitors, Summary

Choose your method of traffic aggregation

Develop specific landing pages to convert the traffic

Use Google Analytics to measure traffic volume from sources

Use Lead Management Systems to measure resulting lead conversion ratios

Apply ‘Feed or Bleed’ strategy based upon the data

‘Go Next’ - add new sources of traffic into the model to effect more visitors

7 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

Online Mortgage Origination Part II: - Today’s Online Value Proposition

Consumerism, as a whole, is not static. Consider the phone book as an example; twenty years

ago a display advertisement in the Yellow Pages met the consumer’s validation. Every

mortgage company exhausted a significant amount of their marketing dollar to maintain the

best position possible in the phone book. Today, however, the print version of the yellow pages

is all but eclipsed by the internet. The internet has replaced the phone book as the primary

directory to hold one’s services out to the consumer. Meeting a consumer’s value proposition

online is not a static event either. What satisfied a consumer yesterday has changed, and will

change again, over time. To be a successful originator online your marketing needs to reflect

the consumer’s current expectations accordingly.

When online mortgage origination was in its infancy there was a very low threshold of

validation required to capture the interest and, more importantly the contact information, of an

online consumer - a simple animated gif with dancing aliens and a flashing tag line espousing

‘historically low rates’ would have done the trick. This is no longer the case, however. There has

been a sea change in the online mortgage consumers’ expectations and what will meet their

current value proposition.

8 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

The two primary drivers behind the trend are:

1. The consumer’s increased interest in offer validation and detail.

2. Their prior experience of having their personal contact information commoditized.

The Consumer’s Search for Exclusivity

While commoditized leads currently represent the majority of those being sold in the mortgage

space their effectiveness is diminishing and the lead generation industry is shifting to create

more exclusive referrals to their advertising lenders. Here’s why: the consumer hates the

commoditized experience. In fact, the consumer dislikes the experience so much that,

predominantly, they will not reengage an online lending experience in the same fashion twice.

The reason for this is simple - what they were in search of (validated offers and qualified

information) was replaced by five to ten different lenders blowing up their telephones and

email accounts. The result, more often than not, is a defensive consumer engaged in an almost

hostile experience with multiple sales people all saying ‘choose me’.

If you ask a room full of people to ‘raise their hands if they have ever participated in this

experience’ a majority will raise their hands. If you ask the same group to ‘leave their hands up

if they would ever do so again’ there typically none remaining (I have done this exercise in

numerous occasions). The lender’s side of the commoditized lead is not very different.

There is a hard cost on the lender to participate in commoditized leads as well. Lenders who

compete for these commoditized leads are required to expend additional funds to capitalize

technology and personnel beyond the cost of lead acquisition. The primary intention of these

acquired assets is to be ‘first’. The first lender to contact a commoditized lead has a 40% greater

chance of transacting with the consumer. If the lender is not first they might as well be last.

Even with the most sophisticated of approaches the percentage of closed loans per lead is far

9 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

from optimum in today’s lead market. Further, the effort to compete in the ‘call center’

consumer model surpasses the patience and limits of most mortgage professionals.

The negative consumer experience, combined with the lender’s marginal return on investment,

has created a new value proposition. Both the lender and the consumer prefer, and benefit from,

a more exclusive contact; specifically, a contact that is singularly initiated by the consumer and

predicated upon the consumer’s validation.

The New World of Validated Offers

Thanks to companies like Amazon.com, EBay, and others, today’s internet consumer expects a

high level of clarity with respect to what they are buying online. Beyond the attributes of cost

and granular details about the product or service, the consumer will also likely want to validate

what other people have said about you. Today’s internet consumer has been conditioned to

know every aspect of cost, product or service being delivered, and how well you have

performed at ‘delivering the goods’ in the past. This sea change represents the end of the

dancing alien gif stating ‘refinance now’.

You can see this change today, and how many different lead

providers are either leading the trend, or transitioning to it.

As an example: LendingTree, the industry front runner of this

consumer validation, launched their ‘Long Form Lead’ in the

1990’s. The Long Form was, and still is, a very good way for

consumers to get the cost of their mortgage; however, it

lacked the consumer’s exclusive selection and ratings. As

good as it is the Long Form still has many of the attributes of

the commoditized lead.

In an evolutionary step LendingTree launched ‘LoanExplorer’. In so doing LendingTree created

currency with respect to the demands of today’s internet consumer. Everything that today’s

consumer expects to validate regarding a loan can be found LoanExplorer. And so this process

goes on for all online originators. Online originators need to stay current with the consumer’s

value proposition. As an aside, LendingTree is making upgrading the Long Form and creating a more

exclusive engagement between the consumer and the lenders presented.

All of these efforts have this purpose in mind: to meet the value proposition of today’s

consumer and to improve the advertisers’ return on investment. Note herein: LendingTree’s

success at meeting this value proposition is no less key to their success than it is to your own.

10 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

Providing Validation on a Local Level

So what does a traditional lender do? Many lenders cannot compete with the margins of the

national lenders present in the prominent rate tables – nor do they want to! Does the mean that

they’re out of the game? Not at all! There are a number of ways to acquire the technology and

get consumers into this experience (see Part I on acquiring site visitors) - including leveraging

your existing agent and builder contacts. Every lender can (and should) deploy technology that

meets your customer’s expectations and creates new business. Moreover, you can do this

without having to match some other lender’s compensation plan to transact effectively. By

presenting your offers in your own site and landing pages you can create exclusive contacts that

are highly validated and welcomed by the consumer. These contacts are the highest converting

leads with closing rates 6X greater than the traditional commoditized lead.

Converting to a Validation Model

Converting to a current validation model requires a

fresh look at your consumer facing technology. Start

with your current website or landing pages and work

the same processes into your CRM. Every contact that

comes from the website needs to receive the same

validation from your CRM’s automated responses

(see Part III – The Art of Being Sticky).

Depending on one’s technical abilities a lender may

be able to accomplish most of this without hiring out.

Choosing not to contract the site’s validation redesign

out assumes that the lender has both the time and

ability. The coefficients of a lender’s time and ability,

however, can be greatly affected by their pricing engine provider.

Most lenders’ abilities, with respect to integrating pricing into a robust web environment, are

limited by their pricing engine provider and the provider’s platform. Further if a lender wants

to create something more ‘out of the box’ than what is supported by their current pricing engine

one could expect the cost of the project to increase exponentially based upon the number of

features to be supported. Note herein: producing a validation model doesn’t have to be

expensive or difficult if the lender has the right pricing engine (LoanTek is the only pricing

engine currently on the market that has a turnkey, fully editable, mortgage pricing interface –

easily customized into any lender’s website). Regardless of which pricing engine you choose the

end result must be the same: allow the consumer to fully validate their loan request and act

upon the information. Finally, once completed the validation model can be used to provide

11 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

results across all channels of origination consumer direct, referrals from builders, agents, and

other affiliated referral sources.

Referral Sources and the Validation Model

Though much of this information is specific to internet marketing please note herein - the

validation model pays huge dividends in the traditional referral market. Lack of validation is

the most common point of sale disruption in the real estate agent’s showing process; the same is

true of builders and site sales agents.

Ask any of your referral partners this question: “how many times does this happen to you?”

You show a client a house but at the end of the showing they are left with the following: ‘I love

the home but - I don’t know if I can afford it’; or, ‘I love the house - but I don’t know if I will

qualify for it’. With a validation model your referral partner could pull up your validation site

on their tablet; review the available options with your mutual client, and; seamlessly make the

referral back to you, the lender. The referral is based upon answering the consumer’s specific

questions and providing detail on the finance options that are available and meet with the

client’s approval. Of greater importance –the agent can write the offer having gained the

approval of the client and having eliminated the road blocks of affordability and qualification.

In closing, the consumer’s value proposition is not that different in

person as compared to their online experience. They seek to know,

‘what’s this going to cost?’; ‘can I afford this?’; and ‘What do my

terms look like?’ before they can act with confidence. Providing your

referral partners with your validation model only increases their

ability to transact efficiently - and communicate those loan requests

back to the lender who enabled them to do so. In the end, the process of communicating the

terms of the sale is a simple matter of meeting the client’s value proposition.

Online Mortgage Origination Part II: - Value Proposition, Summary

Develop site tools that meet with today’s consumer standards

Get as many exclusive referrals to your validation tools as possible

Bring as many visits to your validation tools as possible

o CRM

o Builder Partners

o Agent Partners

12 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

Online Mortgage Origination Part III: - The Art of Being ‘Sticky’

‘Stickiness’ can be defined as the art of keeping your customer

engaged at each stage of the sales cycle. When accomplished,

‘stickiness’ increases sales conversion ratios and differentiates

your offering from those of your competitors. The object herein is

to keep the customer ‘stuck’ to you via your messaging. To do so

your messaging needs to reflect the customer’s stage in the

transaction cycle and contain messaging that induces them to

move to the next stage of the cycle. As an example, proper messaging could induce a customer

to move from ‘qualified‘ to ‘in processing’. Failure to engage leads and referrals in this fashion,

however, causes pipeline ‘fall out’ and a lender’s closing ratios will suffer as a result.

To ensure that your consumers are moving optimally through each stage of the sales cycle (Pre-

Contact, Contact, Pre-Qualified, In Processing, and Closed) you will want to employ the use of a

CRM. To differentiate yourself from your competitors you’ll want to use a CRM solution that

offers validation as noted in the prior section and measures your consumers engagement(Online

Mortgage Origination Part II: - Today’s Online Value Proposition).

Four Considerations to Effect a ‘Sticky’ CRM

Timeliness

Relativity

Validation

Call to Action

Ask yourself this question: How often do I receive email, even from a known service provider,

that goes directly to my deleted or spam folder? The object of this section is to ‘not to be like those

senders’! By creating timely messaging that is relative to your clients request and stage in the

transaction you can validate their concerns, answer questions and, by doing so, induce them to

complete your call to action. Here are a few suggestions on the subject:

Timeliness

Know the logical time frame associated with the given stage of a

transaction. Frequency and timing of messaging is critical to your

messages being either read or dumped. As an example, it is not

uncommon to have 3 emails in a week inviting a newly assigned

contact to return your call; it would be a poor practice, however,

to send a pre-qualified home buyer three emails in a week telling

them about the home buying process. In one instance you have a

13 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

defined sense of urgency: ‘you have a question about a loan – I have an answer – please return

my call’. In the other, you have a prolonged sales cycle while the client shops and finds their

eventual home. The timing and your frequency needs to reflect these nuances. Finally, with

respect to timeliness – know when to quit. If a consumer fails a given sales cycle (the newly

assigned contact doesn’t return your call or email) it is safe to assume that they have ‘tuned

out’. This doesn’t mean you want to burn them out with incessant messaging. You will want to,

however, have different messaging that emails out at longer intervals with messaging inviting

them to reengage where they left off. These ‘nurture’ emails are great follow up emails that,

when delivered in a timely fashion, reconnect the client to you.

Relativity

The messaging in your CRM must be relative to the pipeline

stage of the client and the length of time they have been in

that stage. As an example: You wouldn’t send an email

inviting a client to call you about their appraisal if they hadn’t

completed an application yet. Keep the message relative to

their actual position in your pipeline. Messages should incite

the pre-contact lead to call you, the client you’re speaking with to complete their application,

the applicant to lock and submit their documents, and so on. Finally, keep the message short.

The best read emails contain only a few sentences that convey: a welcome, the steps that they

need to take to move forward, and a close. Providing excessive ancillary information in a pre-

formatted email risks not being relative to you client’s interests. If you’re not relative you’re one

step closer to your client’s deleted folder.

Validation

In order to move a client from one stage to another (‘assigned’ to

‘in contact’ as an example) you will need to have content that

provides the consumer with validation. Validation in simple

terms is the answer to the client’s question: ‘What’s in it for me?’

Additionally, validation at one stage of the pipeline is different

than another. A client who has made application could be

induced to lock a rate and move forward with a message that

speaks to interest rate volatility. A perspective client could be moved to contact you about an

application with a message that validates the terms of the mortgage they are looking for. In each

email that you send stage you’ll need to validate why the client should progress forward in the

pipeline.

14 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

Call to Action

If you have kept your message timely and relative, and provided validation, then you are in

position to place a call to action in your email. Without the aforementioned, however, the call to

action will be shallow in nature and not be acted upon. The call to action should

be simple: a ‘Do This Now’ statement. Depending on the pipeline stage the call

to action ranges from ‘call me’ to ‘send in your documents’. In each email you

will want a call to action that induces the client to move forward accordingly.

Measuring Consumer Engagement

The fundamental aspect of measuring engagement evaluates your email’s ‘click through’ rate. A

consumer who is clicking links for additional information is a more engaged consumer as

compared to a consumer who only opens an email. Similarly, an email that has a higher click

through rate is an email that you want to pattern other emails after – I.E., the content, and the

manner it is being offered in, is meeting your consumer’s value proposition. Not unlike A/B

testing in landing pages (see Section I) emails can be systemically crafted to affect optimum

results. Knowing what messaging your clients are reading and clicking on for more information

is no less important than knowing when they are engaged.

Knowing When to Act

Just because a consumer clicked on your message does not mean they will automatically

proceed forward in your pipeline. It does, however, give you an indication of their genuine

interest for more information. If you are able to contact that consumer in a timely manner with

respect to their engagement with your email you have a much better chance of successfully

moving them forward in your pipeline. The timeliness of your personal response as it relates to

the customer’s email engagement is vital. A properly timed phone call like ‘I noticed that you

15 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

watched our video today on first time home buyers – did you have any questions I could

answer for you?’ will meet with solid results.

In closing, many CRMs will not have the ability to manage or measure all of the aforementioned

attributes of a ‘Sticky’ CRM. Further, none of these individual attributes are of lesser importance

than the other. The business of a ‘Sticky’ CRM is simple: provide a comprehensive contact

solution that moves your clients through the sales process and improve your close rates. If you

are not feeling positive about your CRM after reading this you should visit LoanTek.

Online Mortgage Origination Part III: - The Art of Being ‘Sticky’ - Summary

1. Send concise messaging that is relative to the client’s pipeline status and induces them to

advance their transaction with you.

2. Messaging has to be:

o Timely

o Relative

o Provide Validation

o Contain a Call to Action

3. Measure your email’s engagement rate and optimize your messaging accordingly

4. Measure your consumer’s engagement to respond with a timely personal touch

16 Consumer Direct Mortgage Marketing From A-Z LoanTek, Inc.

Online Mortgage Origination Part IV: - Scaling Your Online Generation