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Many loan officers do a great job of helping their clients get their loans processed. And you appreciate it when your customer tells you “thank you.”

But when you acknowledge their gratitude, you miss the free opportunity to ask for more business.

MLO Doug Cadaret runs multiple successful companies. His “Referral Equation” helps him attract tons of clients. He shares how to increase your business by 60% for free.

In this episode, discover how you can avoid wasting free opportunities to ask for referrals.

Show highlights include:

  • The “Five Milestone Sequence” process that generates moments of gratitude with your clients (3:57)
  • Why skipping asking for referrals ruins your business (even if they've already signed the loan) (10:53)
  • How validating many small yeses throughout the conversation adds up to one big yes (13:05)
  • Why asking for a referral 5 times adds a minimum of 30% onto your bottomline (18:01)

Want to get your questions answered live? Head to MLOlive.com and discover how you could become a Millionaire Loan Officer!

Read Full Transcript

Welcome to The Millionaire Loan Officer podcast with your host, Scott Hudspeth sharing tools, tips and strategies so that you can go from a mortgage loan officer to a millionaire loan officer. It's your host, Scott Hudspeth.

(00:28): Hey guys. Welcome back. You're listening to the second part of last week's episode. Let's jump back in. I don't even waste my time on that question. Yeah. Cuz everybody's referral, referral, referral. We all know. So referral needs somebody that knows like some trust you that refers their friends, family and coworkers. That's what, instead of a lead is somebody that goes online. Oh, I like this house. Put their name and you know, whatever. Give more information. Yes. They might be serious, but just there's so many catches that well there reasons why we'd rather work right here. Yeah. They're more profitable. You enjoy working with them more. They treat you like an advisor, not a sales person. They're probably somebody that may have already referred you. They respect your personal time. The most. I love that about my referrals. Yeah. They're somebody you would enjoy breaking bread with. They take the least amount of time to serve because they genuinely understand what you're telling them is what is important to them. They sincerely appreciate you. There's 10 items here that I believe are the number in sequence. Those are the reasons why most people choose a referral over elite, but I've left number 11 off on purpose. And I wonder if there's anybody ask the question, can anybody come up with number 11? And this is the one that I think is the funniest, because anybody that's really engaged in this conversation right now, the number 11 reason that everybody would rather work with a referral versus elite, got a youth. Do you have any ideas?

(01:44): Just because I don't have to fight with competition. They're trusted. It's a trusted referral. They, I don't have to fight over why they should work with me or why they shouldn't, you don't have to convince them. Right. Actually the number 11 one is they're free. oh they're free. Yeah. That's amazing. Huge. Yeah. Well spending how much money on marketing and advertising and, and producing. And yet we look at our business right now and go, we're not even getting referrals from the clients that know us like us and trust us, but acknowledge that we do a great job. So just lemme just kinda rehash this just to make sure we're on the same page. We're all doing a great job. We're not getting anywhere near the number of opportunities during the process that we deserve. Yeah. And that may have been because we didn't clearly define a successful transaction link. We're defining it now. But yet at the end of the day, no one here would rather work with a lead versus a referral and referrals are free. So if you analyze that and go, what would be different in my business tomorrow than today, it would be. I need to start focusing on those moments of gratitude and realize that I'm not just asking for something I don't deserve. You have to put yourself in a position to realize that you've earned the right to ask every time you hear a thank you for a moment of gratitude and you're not looking for a handout, you're not looking for a deal. You're looking to have a conversation with someone that they care about who could use the right real estate advice. Love it. And this is the number one reason why you're able to go out more conversations, right? The, the sales game is how many conversations a Scott? You taught me 13 conversations. I don't know why I hate to yeah. 13. Yeah.

(03:21): And if you're a realtor, who's looking at your business and wishing you had more, I bet you, there's a direct correlation between the number of conversations you're having today versus the number of deals that you're actually working on. And I believe that there are deals that you're working on right now, pre buyers that you guys are working with while you're driving them around while you're walking through the houses while you're showing 'em the property, while you're setting the home up for a stage or whatever it is that you're doing, understand that these clients appreciate what you're doing. Cause that's why they've signed the agreement with you. Yeah. So use that to your advantage and use that for a, a chance to never have to wake up unemployed when that deal closes too easy, man. Yeah. And so is it, do you ever overcome, like, man, I like, I feel like a sales, you know, I hear a lot of people say and you hear a lot of people say, man I feel like a salesperson, you know, like that feels salesy. Right? Yep. You know, I just tell people, man, that's just in our head. I mean, if you're truly providing a referral experience and you're getting a moment of gratitude, you're closing that door. Like you say, you're closing that door on the opportunity that could totally leave open and say, can I kind of need to send over? Like if you don't ask, you can't get, I used to assume until I met you. I used to assume, oh, if I'm helping somebody with a mortgage, they're gotta refer me. They no, they don't like they don't get off the phone and go, all right. Lemme find someone for Scotty to, you know, they go back to their normal everyday lives, right? The dog needs out, kids call like whatever's going on. They don't sit around and think I'm gonna get a deal for you guys. So to ask is just unbelievable, cuz now they're gonna be thinking about it crazy.

(04:51): You gotta plant the seed. And I think that a lot of times we feel like there's never the right time. And so there is a sequence that we can talk about at another podcast. But I think the, there are definitely milestones through the process that you can absolutely take advantage of that you, as a realtor can use to actually generate that moment of gratitude. You can actually orchestrate that moment of gratitude and then actually implement that into your business. And just to kind of cover briefly is I think if the initial consultation, when you're doing a consultation with your buyers seller, I think you should be able to sit there at the end of the meeting and say, was this helpful? And they will say it was. And your response is if we choose to work together, I ask for a couple things that are non-negotiable timely responses, honesty.

(05:35): And the fact that you will introduce me to someone you care about before the transaction closes. I think it's a normal ask. I think it's at not something that comes across as salesy, right? And to be honest, the sales part of it is the thing that we're trying to sell somebody. They don't sell something that they don't need. Listen, I've always thought that you're better knowing me than not knowing me because I approach the conversation with, I just wanna give you the right advice. Like I just wanna make sure I'm giving you the right real estate advice so that you and your family can make the right decision. Even if it doesn't benefit my bottom line, cuz I know that at the end of this conversation, at the very least, you're gonna go back to the person who referred you to me. And I'm gonna ask that you go back to them and just say, thank you. So I win you regardless.

(06:17): Say those four things. Cause that, like you said that so fast, man, that was so powerful. Say those four things like when you set the, I mean this is just setting proper expectations. You say that are non-negotiable when you're talking to a client. I think it's unbelievably powerful. Same. So Scott, if I'm I, if I'm talking to this, Scott did anything I share with you today? Was that helpful answer any of your questions? Oh man. It was awesome. Doug, thank you so much. Yeah. Appreciate, you saying that. Hey listen. If we choose to work together, I have a couple non-negotiables that I have to tell you up front. Okay. And so the first thing is that at the end of this meeting today, please go back to Carl and just say, thank you. It would mean the world to me. And so knows that I'm giving you the right advice. If we decide to move forward more than that, I'm gonna need you to understand that this business is very time. And when the lender or if I call you and ask you for something, please understand that it's we need it. Like it's tomorrow. We wouldn't be asking if we didn't need it. So things gotta be done very timely. And the third thing is is that if we choose to work together, all I ask is that you don't keep me a secret. Please understand that my business grows with people just like you. I would love to be introduced to someone you care about who use the right real

(07:20): And every time and every time the person who I'm talking to goes, oh yeah, absolutely. It's not even a conversation of, oh, well I gotta think about that. They go by all means. Absolutely. Cause at that point on that emotional high, yeah. That's an hour and a half into your first meeting with these people. Yeah. That's the conversation that you plant the seed with. Yeah. Then when the appraisal come, when you get the appraisal, you should be able to call the client, celebrate that success and then ask them for the business. When the approval comes in, you should know when the approval comes in, you should be able to call and celebrate with the clients and you should be able to check in how's it going? How's the lender doing for you? You know, are they, if you're working with the right lender, the lender's asking the same questions. Yeah. Because they're looking for that same moment of gratitude so that they can help you by giving you back a referral on top of it. And then it goes to the clear to close. When you find out that the closing's being scheduled. And then the last is the day of the closing. There are five moments through the process that if you are not implementing and orchestrating a conversation around asking for the business, you're missing out on the lower

(08:17): You're missing out. You're missing out on a lot of, of easy stuff, free stuff, free referrals, right? Free. Yeah, good stuff. And you know what? 60% of the people you work with outta 10 people, six outta 10 of the people you closed the deal with last year actually would love to introduce you. But to be honest, they don't think about it and they don't really know they, you need it. And I bet you, anybody that's watching this class today could stand to use a handful of new referrals. And it's there. And here's the crazy part. If you are not getting the deal, somebody else who doesn't care for them, as much as you do is giving that opportunity hundred percent. Yeah. And warning warning right now with lack of inventory with what's happening in today's industry, that's never happened in the history of the mortgage or real estate everybody's coming after your client. So if you have a hundred, this is scary. If you have a hundred people in your database, 60 of them would ref for you, their friends, family, and coworkers. If they remembered you and knew who you are and know what you do for a living. If you communicate and ask, look for a moment of gratitude, Hey man, it was so awesome working with you. So cool. Really appreciate your trust, man. Is there anything I can do? No man. You're awesome. Thanks. Boom. Done

(09:32): Ask. Thanks noticing. Thanks for please. Don't give me a secret. Great. Thanks for noticing. Would love a chance to work with someone you care about would love to give somebody the right advice. There are so many different ways to ask it. You just gotta focus on the conversation around. I'm just trying to help people avoid the mistakes that so many others make. And if you come from that point of view, if you come from that givers gain kind of mindset, I want give the knowledge away. I I'm gonna help you avoid the mistakes. Then you become a resource. The moment you become a resource to your clients and you become a resource to your relationships, you automatically become the person they turn to. Yeah. But percent of your clients right now, they don't know it. They don't even realize that you need the business.

(10:11): Unreal man. Good stuff. This is still a challenge. Challenge. Challenge everybody on this call to not repeat, do not waste a phone call with anyone. If you call me and talk to me, ask me, tell me something. Right? Right. Don't waste it. So I'm just telling you, man, if you do, you're just missing out on so many easy opportunities that are free and it's not because they don't like you don't love, you don't wanna work with you. They just don't remember. Right. So more than ever now communicate. And you know, if you have five people in process looking for homes, you're gonna need more because you know, lack of inventory and multiple offers, you just need more of them. You can get more by this equation right here.

(10:54): This is what, this is what we have posted on our desktops. This is what we have posted in our walls. This is what we use to help remind us, cuz going back to what we said in the beginning, intentionality is everything we forget. We get caught up in whatever the fire is at that moment, we get caught up in making sure we're we're we're on time to the next appointment. So we miss that 10 to 32nd opportunity in our conversations to really maximize our financial opportunities in our relationships. And so this referral equation is something that I just wrote just so that I could keep it straight in my head. And it's how I had to kinda learn it. And it's broken down into we're all having conversations. We're all giving value. We're all sharing value. But the problem is sometimes that value that we're providing isn't always received.

(11:34): So we have to make sure that it's received by check in and waiting for that moment of credit to just cause you hear me talk like right now, you and I are talking Scott and it feels like we're giving value and that people receiving it. Right. But there are people who are gonna walk away and it's not gonna change their life. And we're gonna ask, Hey, was it helpful? And they're like, yeah, it was okay. That's what I don't want to have happen. So when you're in your conversations with your clients and you can generate that G that moment of gratitude, that's when you know that you've touched on the fact that you've provided them something of value that, that resonates with them. Then we have to pause and realize that it's at that point where we can capitalize on our opportunities by throwing in that other R, which is the referral, which is the request, which is just asking, this is what we coach to ours and to our, to our other clients. You got to realize that if you're not asking, you're not growing your conversations have to be around the ask. And when you ask it translates into business, 60% of your clients are just waiting for the opportunity to hear that you need to help because they would like to the favor.

(12:35): That's amazing. That's a big number. You know, what's funny is you said something that was really important. You said, we think we're giving value, but are we like, we go through the motions. We do this a hundred times a month, right? Not a month, but we do it a lot. And so we just kind of like get in motion and we're like, we just talk. We're like, man, these guys are every one of my clients just loves this because I'm giving 'em so much when they don't, when they do it one time and they're like, they just wanna go, what's my payment gonna be like, we're like talking, saying all this stuff. And they're like, I don't even know. Like, so if we're not getting that moment of gratitude, maybe we need to change what we're saying.

(13:11): Right? Checking, put a finger on the pulse of the conversation every couple minutes. Cuz I learned this the hard way sometimes hanging out with me is like taking a sip of water from fire hydrant. I just kinda unload and just dump it on people. And I wasn't paying attention to their verbal cue or their nonverbal cues. And so I began to really pause myself at certain points going, Hey Scotty, is this making sense so far? Am I helping? Am I answering questions? I'm always looking for that status. Yeah, because what I'm doing is I'm asking for that validation. I'm asking for that. Thank you. Or that yes or I am. Cause I've heard, I've heard that when you ask somebody, if you're helping them and they say, yes, it means that they're willing to listen to whatever you have to off, you know, whatever you have ask in return. The law reciprocity,

(13:53): Law reciprocity, big time. Yeah. It applies. It applies in our personal life. I do know that if my wife walks into the room and she says, Hey, how do I look? And I go, you look great. It's not new the same. But if she walks in, I go, wow babe, you look great. I've heard, I notice. Right. A hundred percent percent. Yeah. But in our business we can't live on that. We have to make sure that our clients are engaged in giving them the value that they're looking for. The advice that they're asking for the information that can help them. And if we can find that, thank you. Buried in that conversation guys and gals it's it's a life changing experience. I mean think, think about if, if you close 10 transactions last year, just 10, let's just say 10 as an easy number. And you, you closed four more because you asked for the business, you got one from the client or maybe two from your clients in process, just cause round pay square hole or round PA and a round hole. But then you got two more just because you asked average sales price in the country right now is above three 50 ish, bigger, bigger 3% commission. What, What can you do with another 10 to 11 to $12,000 because of a 32nd. Hey, thanks for noticing, please Don. It's

(15:07): More like 40, 50,000 cuz it's 10 to 12 per transaction of extra. I mean in six of those 10, want to help you. They totally want to help you. And I promise you, they have friends, family and CORs that have bought over the last 12 months or are thinking about it. Let's say you asked six talking About it. Yeah. Two of 'em refer you and two people don't refer you, but two do it's I'm going conservative. I'm just going conservative because I want you to understand the impact of the just is, is when you're able to implement this into your business. Yeah. It literally is free money. I mean, you're doing all the hard work anyway. Right? Don't discount the fact that your efforts aren't being noticed, understand that everything you're doing is better than the competition, even if it's not going as perfect as you think it should. The client's perspective is somewhat different. And if you constantly are looking for that, thank you or asking them, how am I doing?

(15:55): How am I doing? You'll be amazed with how many times they're gonna. It's awesome. Thank you. Yeah. I mean think about if I ask, how am I doing? How am I doing? They're gonna say one way or another, right? I'm doing great. Or man, you know what? I wish this or I wish to awesome. Then you can pivot and go, all right. I need to communicate with them more. I need to call them more. I need to, whatever it is, you know? So it's just so powerful dude. So, so powerful. It's the easiest thing to talk about. It is the hardest thing to remember to do. And I can promise you that the art of asking for the business takes time. And so the challenge that I give to my clients sometimes is please just try to do this for the next 30 days. Put a little word band around your wrist and make it so that every time you're a thank you, you smack it on your wrist and you go, what would Scotty or what would Doug do or whatever it is that triggers the thought. Or just remember the, remember the equation, you know, I'll give this to you, Scotty. You can have people use it. Sure. If you can try doing it for 30 days and challenge yourself that if you can get one, just give yourself, you get one current client referral. During the month of March, you're gonna sit back the month that that happens. And you're like, oh my gosh, I didn't have to go. It wasn't uncomfortable. It wasn't something that wasn't aligned with my business. And I'm talking to an amazing person that not only loves who I am, but appreciate who takes least amount of time to serve and I have to pay for it.

(17:12): You know, what's funny is that we, you ask, you know, when you say, and we've tweaked this over and over again, but when you say, Hey, you know, when you get that moment of gratitude, Hey, thanks Doug. Thanks Scotty. And you get that moment of gratitude and you say, Hey, Doug, Doug, Hey can I ask you a favor? Sure, man. Hey, who of your friends? Family. Coworkers would also appreciate good advice that maybe is open into, I don't know, buying or selling investment property. Airbnb, let people know what you do. Yeah. And here's the most important part. There's gonna be an awkward silence because when you ask that question, it's not a yes or no answer. You have to wait. You have to it's it's so it's the hardest thing, cuz you're over the phone. You're like awkward silence.

(17:53): Oh no man. Like what are we gonna say? What are they gonna say? You know? So you have to be really, really, you have to just know that it's gonna be awkward every single time. It never is not awkward. Cause you're asking a question that they have to think, right? Hey Doug, who have your friends, family, coworkers thinking to buy celebrity finance. Yes. You just wait. And if they say man Scott, I don't know anybody right now. That's okay, man. Hey, can I comment, need a, if you hear anybody talking about it, can I kind of to send them over? Awesome. Hey man, one more nugget that I wanna share. Okay. The five milestones that we talked about, initial consultation, the appraisal, the approval, the lender and the in the actual closing, we found a direct correlation to the number of referrals that you get during the process comes from asking no less than five times.

(18:39): Oh wow. Okay. It isn't just one ask. Cause a lot of times we'll ask and we'll fumble through it. And then we just don't ask again, cuz we feel like I'm being repetitive. Truth be told is the clients are busy, right? The clients, the clients have their own stresses to deal with your job is to be able to plant that seed and nurture it during the time that you have them in your, you know, in your wheelhouse. And we find that if you can ask them that question five times during the process, we've actually seen, we've tracked it. We see 30% of your active clients in process refer you, somebody with or the transaction process three outta 10, insane, 60% wanna help you. And 30% will on average, if you take 10, if you know, just like in persistent consistency, you can't forget, you can't go through the motions. You can't go. I got another client waiting like, but you can't just get through your day. You gotta go. All right. Each client is worth another thousand dollars.

(19:33): Exactly. And here's the thing I think about. It's not just one client. They have a sphere of influence of, you know like how many people go to a wedding 250. Right? So is there not 25 people that they could refer you during each transaction? So I say one is 25. That's how I look at it. Yeah. And my goal is to make 'em so happy that they tell all 25, Right? They won't tell all 25. I mean, we all dream that every client RAVs about us, the moment they walk out of a conversation with us, right? It doesn't happen. That's opiate. Right? That's my idea is I'm never leaving it to chance. I am never not going to let, so we talk about a brand. We talk about what we leave our, our images and our business man. Every one of my clients that came through my process, a hundred percent of them knew that I needed one thing from them. And that was an introduction. That's all I cared about when they, if you were to call my clients from two years ago and they'd ask you, Hey, how did Doug build this business? They would all say through introductions to people we care about. Wow. Cause we wanna introduce them. I didn't believe that my business succeeded based on, on me closing a deal.

(20:34): My business was not succeeding because I had happy clients. I gave great communication or we close on time. I believe that the definition was my ability to plant the seed that the client knew without failure that I wanted an before the deal closed. And it doesn't happen all the time. Yeah. But if that's the goal, if that's the mantra. Yeah. A referral from every client and a client from every referral. If that's the mantra that you beat your drum to, I'll tell you what your past clients become. Amazingly powerful, amazing. Even more so than they currently are because they all are out there advocating you hundred percent, man. Love you bro. Unbelievable stuff. It's like every time I hear this, it's just like cements. Like it's totally part of my core, but I just, every time it's so important. So appreciate you more than, you know, always here for you, man. You can be here anytime on agent of mastermind that you want to, man. I love it. And can't wait to see you soon. You man. See you buddy.

(21:24): Enjoy. I'll see you in Orlando. All right man. Thanks guys. Thanks so much. Same time. Same place right here. Oh, agent mastermind. We'll see you on the web. Take care everybody.

I'm a Millionaire Loan Officer.

Thank you for tuning into the Millionaire Loan Officer podcast with your host Scott Hudspeth, don't forget to visit MLOlive.com to have your questions answered. See you next time.

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