Who controls the conversion?

When a client asks about interest rate, how do you respond? Do you allow yourself to get dragged into the conversation or do you subtly educate the client about the important factors to consider when setting up a loan – with the interest rate being an important factor – but often not the most important factor?

The trap that many mortgage brokers fall into is that they let the client dictate the conversational agenda. The person that asks the questions is in control of the conversation. I have written about this advice before i.e. shut up, ask better questions and listen.

This is how I would respond to questions about interest rates: “I can’t promise you that I will always be able to get the absolute lowest rate in every instance over the life of our relationship. Anyone that promises you that is probably lying. But I can certainly add significantly more value beyond any tiny interest rate differential that may or may not exist form time to time.” Then you need to launch into a well-crafted conversation about the ways you add value. My tips for this are:

• Practise – preparing is the key to confidence. Practise talking about how you help clients. It won’t (shouldn’t) appeal to everyone. But it should appeal to your target client. And you must be confident about the value you provide.
• Use stories – selling is not tell. Selling is showing. Tell stories (give examples) about how you have helped your existing clients to demonstrate the value. Real stories add credibility.
• Focus on high value – think about your target market’s high value needs. Some of these things might not be directly related to the mortgage (like guiding them towards buying an investment grade property). But they are high value needs and if you can satisfy them, the business is yours.

If you spend a material portion of your time talking about interest rates your client will think it’s important. It rarely is. Instead, spend most of your time talking about the important things that will ultimately add value to your client. At the end of the day, if the client is super-focused on the lowest interest rate (and that’s truly all they need), you have to ask yourself, do you want them as a client? I don’t. These people are best suited to online lenders and that’s where you should direct them as they won’t be profitable, long term clients.

The key: ask questions, find and demonstrate value and “interest rate” will disappear off the agenda.