What is the Biggest Bottleneck in Your Business?

Because You Don’t More Leads Until You Fix It. Business runs by the numbers. There are different kinds of numbers in that, of course, like the numbers found in the loan documents, interest rates, closing costs, etc. And there are numbers that help loan officers run their business better, like how much money is in their business bank account, how many happy customers they have and their return on investment for advertising. You might not think about it but there is a difference between monitoring a metric, which is just a number, and a Key Performance Indicator (KPI), which is a number that reflects business results. We are going to talk about KPIs because those are the ones that help create results. 

07 03 2019 LI Article Whats The Biggest Bottleneck In Your Business

In our business, loan officers need to track five KPIs with great accuracy – leads, conversations, credit pulls, preapprovals, and locks. Meaning, we need to measure how many leads we get in, how many of those leads turn to conversations, how many of those conversations turn into credit pulls, how many of those credit pulls were pre-approvable, and how many of the people we pre-approve end up with a locking or contract with us. 

Within each of those five KPIs exists the possibility for doing better. When I ask loan officers where the bottleneck is in their business, and what’s preventing them from reaching the production numbers they’re looking for, most will say it’s about getting more leads. The primary business growth strategy most loan officers focus on is trying to get more leads. However, when you have five KPIs, chances are that each has about a 20% stake in creating results. That means that the number of leads accounts only for about 20% of your business results. 

The most comprehensive way to build your loan business is to measure where you are with each of these five KPIs so you know where you’re doing well and where you might need to put some time and attention. (And if you need help in any of this, you know that me and my team have your back, right?)


Let’s assume you have the leads taken care of… you are maxing out your 20% efficiency and effectiveness there. So what’s the next step? Having a conversation with that lead. Now, I’m talking about having a true conversation, where you exchange words – not an email, text or chatbot. This is about getting someone on the phone and speaking out loud — that’s a conversation. 

Now, if you’re getting leads but aren’t having conversations, what’s going on? I would guess that there is an issue with follow-up. It’s probably one of the top three issues I see when I analyze loan officers’ businesses and their behaviors because LOs make the mistake of calling once or sending a message and that’s it. It is definitely not enough. You might be asking how many times you should be following up, and I would say constantly. Following-up with your leads is never a done-deal until you have a done-deal. Even then, you follow up every few months to make sure your client remembers you for referrals and for their next purchase.

But there could be another issue here because you might not be getting the right leads to have conversations. What is the source of your leads? We know online leads have a lower conversion rate into conversations, especially if the leads were tricked into giving their information or opting into a list. That happens when there is an ad that has false facts or uses hype to get attention but can’t live up to the promise. In either case, it’s not good business. Run your ads past a few friends to see if they pass the real-world test before you put them out online. 

And, of course, you need the right bait as well as the right fishing hole to get the right leads. If you are looking for reverse mortgage leads in a new parenting community, as one example, you’re not going to get the right leads (or maybe ANY leads!). 

So once you have made the connection with a lead, talk to them. Find out what’s important to them, answer their questions and set the stage for a great working relationship (even if that means in the future because they’re not quite ready yet). 

Credit Pulls

Once leads come in, and you have real conversations with them, the next step is to verify credit. What could go wrong here? Low credit pulls. 

When you are getting low credit pulls, there is probably a problem with your scripting. If you have leads engaged in a conversation with you or your team members but they aren’t generating credit pulls, something is going sideways with your scripts. There isn’t a sense of urgency, the leads aren’t comfortable with sharing their information or don’t understand why it’s needed at this point. There are many potential objections. However, the good news is this can be one of the easiest problems to identify and handle because you just need a little tweaking and training with scripting.


At this point, you’ve taken the time to collect the leads, have the conversations and get the credit pulls – that’s great! You’re at about 60% efficiency when you have all that working. But what happens when you find out your leads are not pre-approvable? This happens when the lead source is bad. I have two stories to share with you that describe this perfectly.

In the first, one, I was at a flea market, saw all the people there and got a brilliant idea – I should set up a booth to collect leads. With all those people, I should get a ton of great leads, right? So that’s what I did – I set up my booth, started talking to people and collecting leads. I got a ton of them, as a matter of fact. But guess what? When I started working them, I learned the difference between quantity and quality. Even though I got lots of leads and had plenty of conversations that led into credit pulls, none of them were pre-approvable. That was a hard lesson to learn at the time. Flea markets are not a quality source of leads for qualified buyers. 

My second story is about the importance of tracking a KPI around credit pulls. A metric would be how many I got; a KPI is how many credit pulls are pre-approvable for each of my referral sources. 

So I had this agent who I thought was excellent. I was getting business from her constantly and spent a lot of time and resources following up on the leads she sent my way. One day, Diane pulled me to the side and said, “You know, we’re not closing any of the leads this realtor is sending over.” I was floored. I just couldn’t believe it. But the numbers don’t lie. When Diane and I sat with the agent and started going through lead by lead to track results, it confirmed what Diane had said. This agent was a great source of leads that turned into conversations and credit-pulls, but none of her clients were pre-approvable.

If you are having issues come up with your pre-approvals, check your lead source. Your time is your most precious asset – you cannot afford to waste it. This might sound harsh but when you build your business on broken people, you have a broken business. So look for red flags and patterns in your leads and how they’re progressing through your system. When pre-approvals are down compared to your incoming leads, you know it’s time to upgrade your lead source(s). 


Now, if you’ve gone through all these steps but still aren’t able to get these people into contracts, what’s left? Well, if you’re getting pre-approvals but no locks, it’s another symptom of not following up.  

Low conversion – as another point of conversion for your leads – means you have low follow-up. 

We need to talk about our PAALs, or those who are “Pre-Approved and Looking.” I’ll share more in my next post on that. 

For now, look at each of these five KPIs, or steps, in your business process to see where you have bottlenecks, leaks, gaps or inefficiencies. In fact, look at the four areas that are NOT more leads because that can have the biggest impact the fastest in your business. And when you are rockin’ and rollin’ in all five areas – conversations, credit pulls, preapprovals, locks AND leads – your business will grow. There’s just no other possible outcome. 

Let me know where you think you might have a bottleneck in your business below. This is not to call you out! (Well, maybe a little…) Instead, I want you to own what’s going on so you can address it. And maybe one of our community will have been through the same thing and can offer some insight or a way to get it handled faster and easier. So share below – you’re among friends here.

Carl White, Chief Officer of Coolness
Article Originally Posted on LinkedIn











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