There are three main reasons for retaining your clients that you fought so hard to earn in the first place. Firstly, by retaining your client you protect the business that you have already sold; secondly, you have a much greater chance of upselling additional products, e.g. life and insurance products; and thirdly, when your client’s move house they will need to make only one phone call – to your office.
So, what are the practical steps that we can take to retain our clients? I have split this into two separate areas, pre-sale and post-sale (or pre and post-advice). By this I mean how you interact with your client during the advice process and how you communicate with your client in the months and years after the mortgage or insurance deal is completed. Most of the ideas and strategies that I employed during my 12 years as a mortgage and life broker were basic common sense and good business practice.
Philosophy
To give you an idea of what I mean, client retention or good business practice is not a strategy or a tool; it is a philosophy, a way of life. To retain your clients they must ‘value’ you and your service. In order for this to feel natural, firstly you must genuinely value your service and feel confident about your offering.
When you meet your new prospect for the first time, why not ask the question: ‘Would you like me to explain what we do here and how our service works?’ Take some time to elaborate on how the advice and mortgage process works, introduce information about the FSA, explain what duties and regulations you have to conform to. This will reassure the client as to your business processes and responsibilities. The client will feel that you are taking the pressure off, they begin to relax and ‘buy into you and your business’.
Fee charging
When I was broking mortgages I always charged fees. There are a number of reasons for this – obviously charging fees increased my income but it also made my clients feel the service I offered was valuable. If they ever lost the property or had delays in the house buying process, they never thought of going to another broker. Why not? Simply because they had paid me to do the work.
Of course, it is true that some clients did not want to pay fees and naturally they went elsewhere. Maybe they would have done the same to me during or after I had advised them, because they would not have felt committed to me in any way. At any rate if they pay a fee, then you know they are genuinely committed to the mortgage and to me doing the work for them. If you wish, you can refund fees on successful completion when you receive your proc fee. However I did not offer this and don’t see why you should either. If you do a great job (and let’s face it mortgage brokers have to do a lot to make the whole process work) why should you not be paid properly? When it comes to retaining clients, why not offer a voucher for a discount off the fees for future repeat business on mortgages or remortgages.
Client loyalty
What can I do during the mortgage process to increase customer loyalty? The most successful brokers that I have met invest time and resource in communication. Throughout the mortgage process, clients really appreciate regular updates or snippets of information; why not send regular e-mail or SMS text message updates to your clients to keep them informed of the key stages of the mortgage, e.g. case sent to lender, lender acknowledged receipt, valuation instructed, valuation received back (with any relevant comments, e.g. property valued for sale price; or not), mortgage offer received, contracts exchanged. You can get a mortgage case management system to do all this for you automatically so you don’t have to think about it.
Care call
When the mortgage is offered, is there any more that you need to do? At the point of the mortgage offer, you should call you client (recording the conversation using a call recording plug-in) to perform a ‘client care call’. Ask your client if they have 10 minutes free to run through the offer and make sure all is as it should be. Ask your client the following: ‘You are Jon Smith of 47 Acacia Avenue, your salary is £35k per annum, you understand that this mortgage offer is for £120k loan over 25 years and is fixed at 5 per cent for the next two years only? Do you understand that you cannot repay this mortgage in the next two years without paying an early repayment charge, etc.’
In the client care call, go through the key points of the mortgage product and at various points ask: ‘Does that makes sense? Are you happy with that?’, and at the end, ‘Is there anything that you don’t understand or that does not fit in with what you wanted?’ Log the fact that you have made the client care call in your case notes with time and date added for reference later. If you are using the call recording facility in your mortgage case management software, the conversation will be voice-recorded and logged in the audit notes of that specific client. Make sure that you regularly back up your call recordings to CD-Rom, DVD or similar medium.
Client care calls reassure the customer that you have done the job thoroughly and that they are being treated in a professional manner.
So, what should you do on completion? There are various measures that you can employ on or around completion. One chap that I used to work with used to send a bottle of wine or champagne to the client’s new address, another used to send a bouquet of flowers. It is true that none of these actions in isolation will guarantee that your client will always come back to you, however if you perform some or all of these actions you are more likely to make a lasting impression.
Next steps
It is very easy to forget your mortgage client once they have moved into their new property, so make sure that this does not happen, I recommend that you write a letter thanking them for using you and your firm to arrange their mortgage.
In your letter remind your customer of the other services that you offer, e.g. insurances, life cover, etc. Maybe include a printed voucher entitling them to a free insurance check-up, etc, use your imagination to come up with a range of features likely to be attractive to them. You can also ask them to refer their family or friends to you when they require a mortgage and include a 10, 15 or 25 per cent discount voucher of fees when they use you, or even a fees-free service if you insist on working for free without commitment.
Make a point of sending a newsletter to your entire database every six months – you can use your mortgage case management software to do this using the mail merge facility; or if you don’t have a back-office client database, you could get one of your staff to spend some time preparing a mail merge from Excel and Word. In the newsletter, you could include industry information and add some commentary as well (make sure any commentary is expressed as an opinion, not as a fact or as advice).
SMS or text messaging is not only the ideal way to quickly and reliably update clients of the status of their mortgage applications without spending the time (and call charges) chasing the client on the phone but also you can use SMS messaging to instantly send one message to your entire client bank, e.g. ‘Bank of England Base Rates reduced today by 0.25 per cent, please call your Mortgage Broker on 01234 456789 for more info’; or how about: ‘Merry Xmas from your Mortgage Broker, thank you for your valued business during 2006, best wishes from all the team. Visit our website in January for the latest rates and special New Year remortgage deals’.
In summary, treat your customers how you would like to be treated, make them feel special and important to you, and they will surely come back to you time and time again.
Paul Holden is sales director at MortgageStream Case Management Software
