Interview with a Winner:
Denise Phillippi
"Being honest, and doing the right thing, is essential for success. Your clients will appreciate it....If you're honest, and you have integrity in all you do, the clients won't forget."
Denise Phillippi, Peoples Bank, Overland Park, KS
2002 Volume: $53 million
Average Loan Amount: $172,000
Software: Contour, Quest, Mortgage Coach
Boni Lonnsburry: What is your referral source mix?
Denise Phillippi: 50% repeat and referral, 30% Realtor and 20% strategic partners outside the real estate world, like financial advisors and attorneys.
Boni: How did you get started in the business?
Denise: The year I graduated college, I answered an ad for a processing job. I didn't know what I wanted to do, but I had a business degree. Then I got married and we moved to another state. Processing there was like underwriting, so I did a lot of fun things. I got to be a trainer, an underwriter, and got my DU. I worked in the assumption department because it was a home office. I then became a trainer for 21 of their branches.
When we moved back to Kansas City, I helped open a new shop where we did everything ourselves. The position was called Lending Assistant, but we handled the origination, processing, training, closing and shipping with each file start to finish. Then I took some time off to have children, and went back to work in '93 as an originator. I've been doing it ever since.
Boni: Were you an immediate success as an originator?
Denise: No. I actually worked out of my house for awhile because my children were still young. I only worked eight months the first year and barely made $30,000.
Boni: When did it start clicking for you?
Denise: In '98. It took awhile because I had another child after I got back into origination. Once he was in preschool, I had more time to devote to my career. It's been awesome since then.
Boni: What mistake do you frequently see rookie loan officers making?
Denise: Failing to admit that they've made a mistake. If you don't admit your mistakes, the fire just gets higher and higher. If you take care of it immediately, you can admit that it was your fault and fix it. I see a lot of people try to fix one bad thing with another lie.
I also think that many new people call on just anybody. At some point you have to realize that quality is better than quantity. That's something you have to learn for yourself.
Boni: What mistake do you most often see veteran loan officers making?
Denise: It was hard for me, and probably others who've been in the business a long time, to let go and let other people help. I didn't think I was successful enough to hire assistants. I didn't think I was "there" yet, and I thought the volume I was doing was just due to good years for the industry. I was afraid it would drop and I wouldn't be able to pay the people I'd hired. But to transition to the next level, you have to have help.
Boni: How do you know when it's time to hire assistants?
Denise: When you're working 24/7 and you don't have a life. (It was that bad.) But it motivated me to move on and hire an assistant. When I saw what that did for me, it made it a lot easier to move forward the next time.
Boni: How many people are on your staff now?
Denise: Most people don't include their processor or closer as part of the team, but we have a unique situation here. We close all our loans in-house, so my closer and my processor are on staff. I also have an assistant, a transaction coordinator, and an originating partner. So, counting me, there are six.
Boni: If you had a son or daughter entering the business, what advice would you give him or her?
Denise: Be selective with who you work with. Don't be afraid to back off; you don't have to do every deal that comes your way. Choose your niche carefully.
Boni: What is your niche?
Denise: Creative financing is our niche. Because we are part of a bank, we're able to do things that other lenders can't do. For instance, there used to be a seasoning rule on purchases, which stated that you could not use the appraised value for the first year. So if a house appraised for $300,000, and the buyer only paid $250,000, they couldn't use that $300,000 for the first year. That rule has been lifted in conforming lending. I've used the bank to purchase the home, to get it in the customer's name, and then we refinance it onto a permanent loan using the full $300,000 value. We do a lot of the no PMI programs, swing loans, wrap loans, and other customized programs. And if I have somebody who needs to refinance a car, or consolidate debt, I can do it with the help of the bank so that they can qualify for a home loan.
Boni: Do you market yourself as a creative lender to your referral partners?
Denise: Not on purpose. It just evolved that way. There's a saying here in my Real Estate Community, based on my reputation, that "If Denise can't do it, it's not going to close."
Boni: How would you advise a new loan officer to go about finding their niche?
Denise: Many times, your referral sources (your strategic partners and your Realtors) dictate your niche. You might work with a Realtor who is in a subdivision and end up with primarily new construction loans. Everything I've read advises calling on CPAs, attorneys and other professionals, but to be honest, until two years ago, I had not built relationships with any of those people. But that niche is so huge; I just shake my head now and wonder why I didn't do it before.
Boni: What got you started?
Denise: One of my agents did work for a financial advisor. He told the agent, at one of their meetings, that he really needed a lender he could trust to refer people to. She put us in contact and I took him to lunch. The first deal we did was to refinance his personal home. Now he refers at least 50 units to us each year. They all have upper 700 FICO scores, and they've got it together. They don't shop me; they trust me because they trust their financial advisor.
Boni: Are you soliciting more business in that niche?
Denise: I have been referred to another company that he is affiliated with but, because they also do income tax, we needed to wait until the tax season was over. I have another appointment with a similar client as well.
Boni: How do you maintain an ongoing relationship with these referral sources?
Denise: They're very busy and time management oriented, so we correspond through email. Or, they'll call and ask me questions. I do a lot of Mortgage Coach software analysis for them via email. They know that I'm not going to advise anyone to do something that I don't think is in their best financial interest. We have trust there, and that's what really makes you successful in a referral relationship.
Boni: What was your most successful marketing campaign?
Denise: I do my marketing through In Touch Today. I just started the joint newsletters with two of my agents. And I've done the postcards for over a year now. I get a lot of good feedback from that.
I've done first time homebuyer seminars, but I wouldn't consider them very successful. I think they're a dime a dozen now. But the relationships I've gained through the seminars I've done at the law firm have been very successful.
We do presentations on home financing for all the new law associates. The older, veteran partners have knowledge of our products as well, and we make sure that we waive their closing fees or offer them a special deal for working with us.
With a new associate, they may need the tax benefits of home ownership to assist with tax deduction of their student loans. So we go through all the different analogies of how we can get them into a home, even though they're just starting out.
If we based our business on only a fourth of their firm, we'd be wealthy … and tired. Once we do financing for one of them, they refer us to the others. Really, word of mouth within the firm has been almost better than the human resource contact that we have.
Boni: Do you use scripts?
Denise: We use several scripts. My assistant uses one to handle incoming phone calls. We have a different script of questions dealing with refinance. And we have several that we've used for different types of phone conversations throughout the process. We even use email templates for situations such as when the appraisal comes in, and a pre-closing checklist to make sure everything is as the client expects.
Boni: Scripts make it easier for your staff to handle all those different situations?
Denise: It's very helpful when a staff member is out, because we know what her responsibilities are and we can take care of those that can't wait until she comes back.
Boni: Did you develop the scripts for your staff?
Denise: I'll come up with the bullets, but I think that the person using the script should have some flexibility with most things. There are only a few items which are not open to revision. For example, the words "underwriter" and "underwriting" are taboo words in our office, and this is something I feel very strongly about. We try to keep things light and simple. Rather than using those words, we tell our clients that we are going through the final review process to "prepare your documents for the closing. If we need anything further, we'll be getting back to you." To the customer, underwriting is some hierarchy in a room that is scary.
I don't look at myself as their boss; I look at myself as the leader of a team. We are all very blessed to get along. Our personalities blend wonderfully and we really couldn't do any better in that area.
We try to nurture a friendly atmosphere, and we're very unique as a company because we're able to do things no one else can. I've even been able to take personal checks from clients if I've needed to. We're able to do almost anything. Since my closer is part of our TEAM, and not the title company, we can make an early or late-after hours closing happen.
Boni: How do you keep in touch with your prospects and clients, both during the process of financing and then afterwards?
Denise: We're just starting to fine tune the process. I've been unhappy with myself for letting it go. We'd have a larger volume right now if we had communicated with better.
Part of the transaction coordinator's position is to contact our agents and see if they need anything. We can provide financing fliers for their listings or hold open houses. We keep in touch with them via phone once or twice a week to make sure that they're taken care of. We let them know we are here if they need us.
Boni: And do you get interesting feedback from that?
Denise: We found out that the agents would love for us to do more open houses, but they don't want to seem "greedy" and ask us for them. If we make a point of suggesting an open house, then they'll let us hold one. Since we are offering, they don't have to feel guilty about asking us to sponsor it. It helps remind them that referrals are the name of the game.
Boni: Do you send closing gifts to your clients?
Denise: Since I close my own loans, I do the closing gift myself. Depending upon the client, and their preferences, we give a wine caddy and a bottle of wine that has their name, address and closing date on it or a gift certificate to a local steak house. On refinances we give a gift certificate to a local pie pantry.
Boni: Who or what was the biggest contributor to your success?
Denise: The Duncan Group helped me build up the nerve to hire help and go for it. I took my originating partner to one of the seminars. I think you need to have a belief in yourself to hire new people. I was really worried about them being financially dependent on me. But it's not how I thought it would be. We are able to offer a level of service that will carry us through even after the refinancing craze is over.
We try to "wow" the customer while they are with us. And we're always looking for that niche, like the law firm and financial advisors, to supplement our agent referral sources. We've joined with a couple relocation companies, and that has been very helpful in building business.
We're getting back into the new construction market. Our county is one of the wealthiest in the United States. 9/11, the whole recession and the war have not hurt us at all. People are still building houses like crazy.
Boni: If you had a magic wand, what would you change about your current business?
Denise: I'd ensure balance for myself and my team. We all want to make sure everything is so perfect, and it is still hard for us to pass along the loans. If we were working together like a perfect conveyor belt, we'd all be in at 8:30 and gone by 5:00. Right now that isn't happening. But the more organized we get, the more systems we put in place, the better things go. We're a lot better as a team than I used to be alone.
Boni: What are your goals now?
Denise: Our goals are to do $70 million this year and to get our team running smoothly.
Boni: Is there anything else you'd like to say to other originators who aspire to this kind of success?
Denise: Don't be afraid to ask every customer if they had a good experience, and then we ask them to refer us to their friends and family. I don't think anyone has ever said "no" because they're happy with the experience they've had with us.
Being honest, and doing the right thing, is essential for success. Your clients will appreciate it. Also, you have to be patient, because success doesn't happen overnight. If you're honest, and you have integrity in all you do, the clients won't forget!