DON’T ‘PAY AND WALK AWAY!’

BY PAUL WATKINS

In a conversation with an adviser a few weeks ago, she told me she feels like a marriage guidance counsellor at times, due to the financial stress some of her clients are under - and the tears and arguments that can erupt in client meetings.

Financial stress is one of the main reasons marriages fail.

As full financial advice is outside her expertise, she has referred some clients to a financial planner who can help organise their financial affairs.

What am I leading to?

Run an advertising campaign today and have the phone ring tomorrow: that’s what we all want, but it misses a key component, being your existing clients.

Interest rates are up (and could rise again), house-sales volume is down, and sales prices have declined. A challenging market to be trading in. And it’s compounded by fact that many of your clients fixed or secured a loan during low-interest times.

It’s at such times that switching from a ‘reactive’ approach to a ‘proactive’ approach is needed.

Don’t wait for the stressed client to call; you need to get hold of them.

As I have written about many times before, you must continually ask yourself, “What value do I add?”

Why should a client come back to you, and not go direct to the lender, with any request for a variation on the term or to refix?

Lenders now offer ways to change mortgage settings online with no human contact.

Clients get emailed prompts from the lender when it is nearly time; they can adjust the payments and refix from the range of options of repayments and loan duration offered. Quick and easy.

So where do you come in?

Without being cynical, many brokers spend a lot of time arranging the first loan and then ‘walk away,’ as the famous television ad goes.

So, what can you do on a proactive basis?

Contact them well ahead of the expiry date of their fixed-term loan.

This can obviously be by email, but email is a very clinical and impersonal way to do so. It should therefore be the last resort.

Some years back when I had a mortgage due for refixing, I called the lender for some thoughts and options – although I had originally set the loan up through a broker.

He asked me relevant questions and offered me options to refix.

He was clearly knowledgeable, as he should be, and the 10-minute phone call ended with a suitable result for both of us.

I know what you are thinking: why didn’t I call the broker first?

It was because my lender had also become my bank.

I interacted with them through my phone almost daily; it was easy to hit the phone number and discuss it with them.

My only contact with my broker had been cut-and-paste, emailed, quarterly newsletters, which I had mostly been deleting without reading.

I am sure many of you send out emailed newsletters, which probably all repeat the same content.

So, what can you do to be seen to be adding value and reducing financial stress?

First, educate clients: send short video tips of yourself on how to cope with increasing repayments.

Yes, you read right: video, not written text.

We live in the TikTok generation, and only video has any cut-through now. These videos can be of budgeting tips, food shopping, setting up an emergency fund, managing credit cards, mortgage-restructuring options and similar.

Before you say, “But I’m not a budgetary service”, think again.

How are your clients feeling right now? You arranged the single biggest financial decision they will ever make, in the form of the mortgage, so this has implications on their daily spending.

If you don’t want to do such budget or financial advice tips, or don’t feel qualified to do so, find someone you can engage to do them for you.

If you do produce such short videos, like 30-90 seconds, then run them on TikTok and Facebook, or whatever social media platform your clients patronise.

This will not only impress clients but become your advertising for more clients.

Without wanting to sound critical, it amazes me how few brokers use social media platforms, which are almost the only media that’s working right now.

My own thoughts are that either many of you don’t want to have your face featured on social media or that you don’t understand the platforms enough to know how to use them to affect.

They work and are incredibly costeffective.

Avoid email! Yes, email can still work, but it is unfriendly, impersonal, and, in many cases, unread.

How many did you received today and how many did you read? Be honest.

Use snail mail instead. Yes, snail mail. It’s quite a novelty to get any mail at all these days.

Write a book! No, I don’t mean a 250-page novel, but a 12-to-20-page, well-illustrated, professionally-crafted booklet called something like, ‘Ten ways to cope with mortgage interest rate rises,’ or ‘How not to panic when your mortgage repayments go up’.

Then post (no, do not email) a printed copy to all clients whose fixed terms will expire in the next few months.

Books, even short ones, give instant authority to you as the author. They now see you as, “He/she must be good –they wrote the book on it!”

It also puts you in a position of considerable differentiation from your competitors; and since it was posted in hardcopy, they may show friends.

Turning the book into a PDF’d e-book version can then act as a lead magnet for prospecting.

They see the ad on social media and click through to get a copy, requiring them to give their name and email address.

As you have probably gathered, this is all ‘Education-Based Marketing’.

Instead of ‘selling’ your services, you educate clients and prospects, thereby convincing them that you are on their side and not just a ‘pay and walk away’ transaction merchant. Big difference.

And on this point, be proactive, not reactive.

I will reiterate: call the client for a chat well before their fixed term expires, like as far out as three months. They will appreciate this, and it lessens the likelihood of them being tempted to go direct to the lender.

I have met brokers who ask me to help run ads that make their phone ring, but are terrified of picking up the phone and calling a client.

I don’t get that. We are humans and crave personal contact.

Be proactive and don’t just ‘walk away’. ✚