The Advice For CU Mortgage Lenders? "Nichify Yourself!'

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According to one mortgage lender, the secret to success can be as simple as being different from the competition.

"Any specific segment of the market can be successful," Brian Farley told attendees of the recent American Credit Union Mortgage Association (ACUMA) conference here. Farley, the president of Middletown, R.I.-based Pride Mortgage, began his presentation with a slide that stated: "Nichify yourself! Focus on the critical few...not the insignificant many."

Farley used himself as an example. Years ago, when he was struggling to make ends meet, he decided in order to succeed he had to find a niche for himself. He discovered a high demand for second homes on the Atlantic Ocean by people who lived and worked in New York City.

"I learned everything there is to know about vacation home lending," he said. "I worked with banks and credit unions and told them 'I don't want your member, I don't want your customer. I don't want their checking account. Just let me handle the mortgage for you. It worked."

A powerful mortgage department begins with a good sales force, Farley said. He recommended interviewing potential salespeople on the telephone first, to ensure they are comfortable talking on the phone. Following a face-to-face interview, Farley gives candidates a written test. Among the questions: describe a great day and a terrible day on a previous job, describe two past successes, and two past failures.

"I do this as a written test because how they communicate to me, and how articulate they are, tells a lot about them."

Besides hiring the right people, other mortgage fundamentals, according to Farley, are instituting a unique service culture, freshening communication, saying "no" to negativity, polishing the corporate and individual image, pursuing continuing education, and mastering task management.

As an example of a unique service culture, he pointed to Jan Carlzon's turnaround job at struggling Scandinavian Airlines. Carlzon said the first 30 seconds of interaction between the customer and the frontline company employee represent "Moments of Truth" (Carlzon later wrote a book with that title). In an effort to improve the company's performance during those key moments, Carlzon turned the company's organization chart upside down: the highest-level executives manned ticket counters and reservation lines, while the former low-level workers stood nearby and assisted.

The change at SAS helped combat what Farley said is a problem most companies have: as employees do well and are promoted, they often have less and less contact with the public, leaving that task to new, inexperienced staffers.

Combating negativity is surprisingly easy, said Farley. When he was the manager of a bank branch earlier in his career, he made a point of opening the doors five minutes early and closing them five minutes late. This small gesture made his customers extremely happy, he recalled. "Little things are so important."

The best place for a CU to start building a niche is to extract information from its current member database, Farley advised. When building custom programs, he said management should sit down with loan officers and other staff members and ask: "What is going to make a difference in our community?"

"Look for opportunities everywhere," he said. "Remember, Baby Boomers are going to turn 60 next year. They will want second homes, so market second homes to your members. Or, reverse-mortgages for older members. Reverse mortgages meet their desire to stay in their homes. Many are cash or income poor, but have a house with equity."

Another possibility is 1031 exchanges (CU Journal, Oct. 10). "These are very underused, and a perfect way to market to your membership," he said. "Many people don't know what they are, so educate them. Advertise 1031 seminars and align with someone to teach."

The staff should become a partner in niche-building, Farley said. Employees should be educated to look for opportunities.

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