There is a new disease out there: Fear of Financing (FOF). FOF is a psychological disease that prevents people from buying houses. While we have yet to discover a cure, you as a Realtor can sell more houses if you understand it, and help potential buyers overcome it.

Buyers have already heard that same tired old real estate mantra: "Prices are low.  Rates are historically low. This is a great time to buy". They believe that, too.  So what's holding them back? 

Their secret fear that they won't have the ability to finance the American Dream.

And they probably won't talk to you about this, either. Fears show weakness. Fears are embarrassing.

Sometimes it is easier just not to get in the elevator if you are afraid of elevators.  Enduring those few minutes of fear inside the elevator, and getting to the top floor? Just not worth it.

So they just keep walking, and never get to the 10th floor.

Maybe you are losing buyers because they just keep driving (right past that house they love, overcome with an attack of FOF).

Frankly, Fear of Financing is easy for your buyers to justify. It does take more to qualify than it did before. But FOF has reached a frenzy that is out of control and a bit irrational. It is hurting business.

People approach me all the time with this statement: "I hear you can't get a loan on a house anymore......." The statement sort of trails off because they don't want to finish it by saying this: "unless I intend to brave rejection and the possibility I may not qualify".

The media likes to promote FOF...have you noticed?

Let's face it, the fear of rejection looms large in all of our minds. It is why it is hard to interview for a job. To make your  sales calls. To try out for cheerleader or the lead in the play.

Rejection stings.

So how do we get buyers to that warm and fuzzy place where they believe the RISK is worth the REWARD?

The Antidote for Fear of Financing  

How about selling houses by attaching financing options and quidelines to each listing that you have? Lenn Harley said it best when she commented on Leander McClain's featured post, describing her best marketing strategy for 2008:

Shifting from advertising our services to buyer to offering financing opportunities for prospective buyers has made the difference.

Okay, I will pause here and remind you of something I have written about many times: Financing sells. Look at the car business. When they want to move cars they do this by selling financing, not the car. Does it work? Yes indeedy.

I love looking at flyers Realtors put in those little boxes on your signs. I bet prospective buyers do too. But only one in a hundred I look at has payment options, rates, or a call to action if the client would like to get pre-qualified. Why is that? 

If you don't HAVE a mortgage partner to help you with this, you need one.

I know from personal experience that some people will call the mortgage person on the flyer BEFORE they will call the REALTOR on the flyer. Wouldn't you rather capture that lead by having them call YOUR mortgage partner?

Okay, still on the topic of signage: Why is it that I almost never see one of those little signs that hang below the big signs say something like this: GREAT FINANCING AVAILABLE. Or this: SPECIAL FINANCING. Or this: LOW DOWN PAYMENT. Or if you happen to have a really SMART mortgage partner: BELOW MARKET FINANCING (seller has agreed to "buy down" the rate for future buyer).

Do you really think a sign that says "I'M GORGEOUS INSIDE" will do a better job of hooking a buyer? I don't.

And to those of you who send newsletters: do you have a spot on every newsletter for a mortgage update?

Right now it is extremely important that every POTENTIAL BUYER understand that there is still money to loan, and that you as a real estate professional can provide financing direction and assistance.

1. Make it easy for every person who responds to your marketing to have a clear idea of what they need to do to GET FINANCING  
2. Give them the option of calling the mortgage partner BEFORE they call you (this gives you 2 chances of getting a call instead of just one
3. Show them payment options on your listing flyers. Tell them you have financing for "a broad range of credit situations".
4. Don't try to become an expert on mortgage rates and guidelines. Become an expert on overcoming what keeps your customers up at night. That's the way a marketing genius thinks.
5. Encourage the discouraged. Remain upbeat and positive about financing. Give them that glimmer of hope that they are secretly hoping exists.
   

Written by Janet Guilbault, Mortgage Lending Expert with RPM Mortgage, Based Out of the San Francisco Bay Area 925-552-3867 (Direct)