Home : Blogs : Janet Guilbault California Mortgage Banker/Broker : California Mortgage Advisor

Inside The Mind of An Internet Shopper: You Can't Land A Prize Fish In a Murky Lake

ITS 2 AM AND THE PAJAMA WARRIORS ARE THINKING ABOUT REAL ESTATE

There is something sadly ironic about all those "pajama warriors" who apply online for a mortgage at 2AM. I often wonder why they are choosing a mortgage company in the most impersonal way EVER, yet are desperately seeking one of the most personal relationships in the business world.

Crazy, isn't it? But then, its a brave new world out there.

Isn't that what we are supposed to be doing with our blogs? Allowing people to connect with us personally? Aren't we trying to teach the Internet audience that there IS a better way to choose a real estate professional than a great big impersonal site that (in disguise) is actually going to sell your information to the highest bidder (not the best agent)?

Well, fellow bloggers, we aren't there yet.

I have been asked by the management of our mortgage company to handle some Internet leads that were generated by one of the best known online lenders in the country. Frankly, because they have severely cut back their staff, they can no longer handle all of the leads that are flooding in. You read me right. FLOODING IN.

Although I must make time above and beyond the mortgage madness that already exists at my desk, I confess, my insatiable curiosity got the best of me. You know how we bloggers are always looking for fodder.

I couldn't help but wonder: What in the world goes on inside the head of someone who starts the real estate buying process while in their pajamas? Seriously, I want to know.

I COULD WRITE A BOOK ABOUT WHAT INTERNET SHOPPERS DON'T KNOW

Do they know that they are one of thousands of leads and that getting someone good is a pure crap shoot?

Do they know their information is being farmed out and sold to a mortgage broker exactly like that one the Realtor COULD HAVE referred them to in the first place?

Do they know that they are at risk being deleted/ignored just because they didn't fill out the application correctly (example: filling out your weekly pay instead of your monthly pay). That a do-it-yourself mortgage application could cost you the ability to become qualified?

Do they know that most Internet "pre-qualifications" are considered pure garbage by Realtors?

And finally this: Do they understand that SO MANY OTHER applicants are simply...(name one: (1)bored (2)playing around on the Internet, (3) engaging in wishful thinking) that they stand the risk of being LAST PRIORITY when it comes to the person looking at that lead? Think human nature here.

GO LEARN TO FISH, PLEASE

I have come to realize that Internet applicants are some of the most insecure and intimidated real estate shoppers out there. Warming them up, persuading them to call back, making that ever critical connection? Tough road. Even for me with a gift of gab, a genuine concern, and years of mortgage experience.

Much of that insecurity could be wiped away if we could teach them a different way to fish. Instead of throwing their line into that huge murky lake, they can go into the store, look straight into a clear aquarium and say, "I'll take that one".

So why don't they? Do they really expect to land a prize fish out of the murky old lake? With bait that has been haphazardly plunked onto the hook in the middle of the night during an insomniac attack?

This is how I see our challenge: How do we guide the masses away from these huge impersonal sites and into the world of Web 2.0? It is better for them. It is better for us.

I will share with you what I learn on this journey. Stay tuned.

Update: Click here for the second installment of this series.

Confidential to DM : Thank you for sharing your experiences with your own online leads, which helped me write this. You are a gentleman and definitely a Prize Fish.

Written by Janet Guilbault, California Mortgage Expert Based Out of the San Francisco Bay Area

Posted by Janet Guilbault California Mortgage Banker/Broker on 03/01/2008 12:16 PM

Comments (41)

california morgage expert, real estate commentary, first time buyer, refinance, marketing

41 Comments on Inside The Mind of An Internet Shopper: You Can't Land A Prize Fish In a Murky Lake

FEB

2008

Great post and excellent points! I don't think most consumers realize that when they think they are "applying" for a mortgage, they are really just turning themselves into a commodity as a "lead".

Alas. The consumer judges the quality of mortgage companies by their quoted rate, an instant of time.

Alas. The consumer judges the quality of buyer agents by who is available to show them homes on Sunday afternoon when they call on Sunday a.m.

Alas. The consumer judges the quality of listing agents by the commission they charge when the agent gives the consumer the free CMA.

I'm so glad this was featured Janet. While the convenience factor is one of great appeal, that appeal can soon be lost in the reality of people's decision making. That reality, as you've suggested and Kevin Hancock also pointed out, is that they turn themself into a lead. From there, it's a roll of the dice on the quality & competence of the service and products they will get.

AMEN. I think people are still stuck on the 'DiTech' syndrome of finding the lowest rates online. How's DiTech doing right now?

I always tell borrowers that if I am just a 'rate' then they are just a 'check' and then neither of us will get what we want - a closed loan/home that is ultimately the best deal both sides could hope for while maintaining dignity and trust.

Nice post!

Good post and thank you for writing. Look forward to reading more . . .

The world has changed, buyers have changed and we have changed. Many people the only time alone to think straight is when the world has gone to bed. Agree hang that bait and see what we catch.

Great post..I have had 4 buyers in the last 2 yrs that went over the internet for a loan...all 4 were late to close, and one got so late, that they lost the home they were trying to buy, and sveral thousand dollars!

I tell all my clients when it comes to the mort....turn the computor OFF!

William: Love your last line...perfect! I just don't think ANYBODY is going to turn off the computer! Better ....and of course the point of the blog....go research the internet for a specialist that matches what you want find the professional that will handle your real estate and mortgage. Their credentials should be on the internet for you to find and examine.

Go read their blog. See what they stand for. E-mail them directly and ask questions. Why take the chance with the biggest investment of your life? These companies give the shoppers a false sense of what they really are.

. Shopping for an agent is a different ball game

Oh, Dick, I could never think straight at 2AM. And if I am not asleep at that time, then I won't be able to think straight the next day either. I protect my sleeping time...it charges my creativity. Maybe there are night owls...this girl is not one of them.

Sharon: Attempting next to figure out how to convert far more of them into actual cllients.

Lenn:

Alas: the consumer applies on line then wonders why they are not satisfied with the results. What did they expect? Still trying to figure this one out.

I know if I applied online (which I would never do) I would be waiting for a response and glad when I got one. Why in heaven's name do they not call back and avoid contact?

Why is only one lead in 10 good?

Mr. Sardi: You are younger and understand better than I do about shopping online. One of my clients swears that internet shopping has created a generation of people who think this way of shopping for anything is the cheapest, the smartest, and the fastest. He says they are do-it-yourself fools.

He is in the financial planning business and asked me this: would you go online to pick someone to handle your $200,000 stock portfolio? Most people would say NO.

Then why is it okay to go online to find the person who will handle a $500,000 real estate transaction?

Cheapest = Maybe

Fastest = A lot of times, yes.

Smartest = I say, "Not so much...."

Janet, from a REALTOR'S(R) perspective those lenders are a disasater. I tell my clients they certainly can look, but I have NEVER seen a happy client using those companies. I think the lender needs to be local, whether they are a large national company or not, they just need to know the ins and outs of their market like the agent. In Maryland, we have transfer taxes that are about 2% of the sales price, plus our title insurance is higher than other parts of the country. I have seen lenders in Iowa doing loans in MD and for some purchasers, 2% more for closing fees may make or break a deal. I always advise against this practice.

Janet, When I first noticed a little lump on my shoulder, I thought it was a blemish and did nothing.

Months later, it was still there and my concern grew - it grew to the point where I actually researched on-line. Web MD identified the probable cause and showed me pics of other lumps resembling mine. I was satisfied.

A year later, that darn lump made me take real action. I took the time to meet with my doctor who could provide me a real diagnosis.

My personal situation is akin to my personal experience with internet leads. Most are curious enough to learn more but are a year away from action. Blogging/web 2.0 strategies are our best tools to stay relevant during that 1 year incubation.

Kelly

I think they do it to stay in control. They want to make the move to contact someone on their time not ours. Only when that online deal falls apart they may step out of their comfort zone. Or even when they are promised something extravagant and it doesn't come to fruition. Or when they come to their senses and think they want to meet face to face. That you have to do in person.

I haven't gotten too many middle of the night leads for real estate. But, I always call the phone number instead of e-mailing them first. I got one this week that left a bogus phone number. I know because the real owner of that phone called to let me know that she was not the right person. So I then e-mailed the buyer just to make sure she had received my voice message, since I had some questions. I waited a couple of days and sent another e-mail, asking her to please provide the information I left in my voice message, so I could help her. I finally got an e-mail response from her, saying she was just looking right now.

MAR

2008

Janet

Loved the article, while there are many lead generators out there there needs to be developed some kind of filtering process to weed out the tire kickers.

Great post and I couldn't agree more. I always seem to have 20 or 30 leads that subscribe to every tool or email feature on my web site and seem very interested in purchasing a home (or at least looking at them), but they won't pick up the phone or schedule an appointment.

And I swear... I DON"T BITE!

I don't know if they think that I'm going to obsessively call them? I do know that once those "Pajama Warriors" finally do meet with me, they are even MORE hesitant about meeting or talking with a mortgage broker.

Janet, fishing is a great sport, but it doen't count unless you can bring in the fish. Part of that is getting the fish to bite. That takes a strategy to direct the fish where they want to take the bate. Great post.

Kerry: Thanks for an interesting comment. I have found the same thing with my Internet leads.....

I always think: "wait, you did apply online, right? What is it that you thought would happen?"

I think they think that a pre-approval will just magically appear kinda like ordering a book from Amazon.

Or, are they professional applicants? I don't get it. Why is it you think your clients are hesitant to talk to a mortgage broker?

Audry:

I am with you. I only do loans in Calif and an occasional Nevada or Hawaii, but only for my Calif. clients.

The leads I am handling are only for California. Once you skip to another state, you ability to deliver the optimum service is handicapped. Just my opinion, I am sure there are other mortgage brokers who disagree.

Kelly: I hope your lump turned out to be nothing serious, but I appreciate your analysis.

So far, the leads I am getting are actually more serious than I had thought they would be.

Many just went out there and applied to multiple sites....very dumb move. But most do want to buy real estate, and are overwhelmingly tempted by the low prices they see.

But they have no cash! They want 100% financing! They have no clue why it just does not exist any more!

Excuse me? That is part of the reason the prices are so low.

Janet ~ You are right! My thought on Internet shopping is primarily this...the people doing this do not realize that they are not going to get the "instant" quotes they are teased with. Their belief system is truly that they are going to find out what they need to without ever speaking to anyone or having anyone "sell" them something. Sad, but true. Great post! :0

This applies to why do agents buy leads? What is the actually conversion rate of those leads and the TRUE cost?

However I love my internet leads. I think they are different when they see its a person. I convert many into sales. I deal with some international clients and have closed one from France, England and working on one from Japan. I could care less what time they write. However know exactly what you are saying! You will have to check out my new blog about New Orleans. New Orleans Condo Trends, it easy to blog about eating here?

Hi Eric! I will definately check out your new blog.

So you love your internet leads? What is your ratio of conversion? I am attempting to make it higher than the 9 to 1 that currently exists (topic of another post)

Honestly, what I love the most is being inside the head of so many people in such a short span of time. It really helps you understand what they are thinking and what insecurities they have about buying real estate.

It also lets me practice my "selling scripts" over and over, which helps.

Sarah: I agree with what you have said. They secretly hope that they never have to talk to anyone. What is the world coming to? They want a computer to handle their mortgage?

Janet 9-1 is a teriffic ratio for real estate sales. You learn to weed them out rather quickly. Some you never talk to, some never write you back, 50% are weeded out is a few seconds. If they give you too much or too little you are in trouble. I need 50 sales to be a very good agent in this market. I am sure you need many more loans than that so the numbers get skewed.

LOL.....Pajama warriors. That is funny. I blog in my pj's usually. If I could, I would do everything in them. They are comfy!

I know that they are definitely just fishing and who they get depends on their luck!

From the consumer perspective, it is convenience. They can look, check and get their feet wet. It isn't as threatening as getting face to face, or even face to phone.

I know that the leads blow. Too many people want to just retain their anonymity...

Interesting post. I think there are "degrees" for leads, some just fill out a form to get information and others looking for help. Some take a long time to incubate. Some are worthwhile and others are definitely a waste of time.

Will be interested in coming back and reading more about this after you have worked longer with the Internet leads -- sure it will be interesting.

MAR

2008

Right on.. I think more internet shoppers out there need to know what's really happening when they are visiting the lead generation for sale sites.

I think the internet shopper is the new future. But, it's still a long way off. Remember how appalled everyone was when tv shopping came about. It's a huge industry now. A lot of the "old school" agents in my office tend to ignore the importance of the internet, and think it's just a phase. Some phase huh?

Thanks for a interesting blog. Looking forward to reading more from you. Great info.

Janet,

No, No, No, No & No!

They do not know. I think they believe they are more in control of the situation by requesting quotes on line when in fact they have given up all control.

There are at least 20 questions that a loan officer must know to give a "real quote".

Great post, thanks for the food for thought.

Janet,

Enjoyed your post. The same thing happens with the online "insurance" sites. They just farm your information out to the unknown agents of the world.

Bob: You are right. I believe there are quite a few kinks that need to be ironed out before we are completely successful in pleasing the Internet shopper. At lease when it comes to real estate.

Lee: And the last thing they want to do when I call is play 20 questions. There needs to be some romance before they are willing to answer those questions.

Diane: That is the biggest misconception when they offer up their information. I think if they understood this, we might have a better chance of closing more of these leads. They are actually a little upset when they finally realize this,

MAR

2008

Janet ~ So sad, but unfortunately, I think it is all too true. They just have not been fortunate enough to meet the likes of you, me, and countless others who will treat them well. If only they knew that my clients almost always get at least one Starbucks date out of me....maybe then!

Hi Janet ~ I have included this post of yours in the Mortgage PRO Week in Review. Thanks...

MAR

2008

Nice intro to why home shoppers should read blogs.

Leave a response…

Name:

Email:
(optional)

Comment:

What does the graphic say?