Perfecting your strategies for conducting borrower relationships, getting a deal back on track, and hitting the brakes when needed are critical skills to keep your business on schedule.

In the real estate investment industry, one of the best things borrowers can do to help themselves is shop around for the best loan possible. If you’re an account executive at a private lending company, it is important to understand your client may have other options.

Some key aspects of the deal process include:

1. Recognizing clues the borrower is shopping the potential deal around.
2. Deciding when it’s best to focus on the transaction at hand or present the long-term value.
3. When to move on from a deal even after putting in a lot of hard work.

Successfully navigating these is essential to creating success for any sales team representative.

Shopping Spree?

Borrowers are always trying to find the best deal. As a sales rep, it is important to understand the borrower’s thought process and not get discouraged if they take deals elsewhere. There are certain cues you can look for to gauge whether a client is shopping their deal around.

One of the first clues your customer is shopping around is if they ask very specific questions, especially about industry details such as the following:

1. What can be offered for a maximum initial advance?
2. What are the interest rate ranges?
3. What types of loan options are available for the deal?
4. How can closing costs be reduced?

If your client is asking those kinds of questions, it may be very clear the borrower has been gathering information from other lenders. Borrowers who come to you prepared with expectations or demands in the hopes a deal can be matched or improved upon have usually been shopping around.

Another cue is the experience of a borrower. If a borrower has been investing for years with an expansive portfolio, you can bet they have many other lender connections and will be shopping the deal around. Even if you have a strong working relationship with a borrower, vast experience is a surefire sign they’re a savvy investor with a few different lenders in their contact book ready to give them a great deal to earn their business once again.

An additional sign worth discussing when it comes to borrowers who are potentially shopping around for a deal is the request for special or preferential treatment. Questions such as, “What can you do for me to sweeten this deal?” or “How do we get the highest initial advance to avoid a big down payment?” are little clues the borrower wants the best deal. The “best deal” is usually just another way of saying, “Can you give me a better offer than the one I’ve already received?” As a member of the sales team for your company, the onus is on you to understand the client relationship. Every client is different, so sometimes you may be willing to acquiesce to their requests and give them that deal. Other times your best offer may not win the day. Accepting the fact they’ve shopped around and then moving on to the next client is all you can do in some cases.

Today vs. Tomorrow

As you move further along the deal pipeline, there are important conversations you must have with the borrower to ensure the opportunity ends successfully for you. In particular, focus on two pivotal areas when discussing deals with a potential borrower. The first involves transactional details and loan specifics. The second is whether to drop in long-term value and hint at a partnership beyond the current deal. Deciding when and how to approach these conversations is critical for any sales rep.

During your initial conversation with the borrower is when you want to harp on deal specifics and transactional details. Highlight the positives of the offer you are extending, especially if the deal is the best your company can do. Highlighting the other benefits you and your company can provide (e.g., a faster closing, an easier closing process, and a higher level of hands-on customer service) are all reassuring for borrowers as well. This conversation is your chance to explain the benefits of taking your deal as well as flexing your industry knowledge to sway the borrower into accepting the offer you’ve presented them.

On the other hand, as you get closer to closing the deal and the borrower may be deciding between offers from different companies, you can start to talk about what a partnership would look like moving forward. Drop in the fact that you’ll work tirelessly for them if they give you repeat business. Borrowers react well to account executives offering them such benefits. Going that extra mile and promising a successful future could close that initial deal.

Transactional details also go much farther with experienced borrowers. They’ve heard every sales pitch imaginable, so getting to the nitty-gritty of the deal is what they want to hear. As for newer borrowers or first-time investors? Dropping in the partnership possibility and the opportunity for the two of you to grow together professionally, close an abundance of loans, and positively impact their investment career is a huge selling point.

A Road to Nowhere?

Another part of the sales process experienced account executives are good at is cutting ties at the right time on a deal that is going nowhere. Noticing signs a deal may be at a dead end is crucial because it can save you and your company time, energy, and money.

The first one may be obvious: cutting ties with a borrower who is disrespectful, repeatedly unprofessional, or just rude is always a must. If a borrower is taking you away from your other clients and draining your energy and confidence, then you need to cut ties immediately. Handle the situation professionally by letting your manager know you can’t work with that particular person and see if they can step in to walk you through a plan of action to end the relationship.

A different, but still disheartening, interaction with a borrower that usually means it’s time to cut ties is if they are asking the same questions repeatedly. These borrowers don’t respect your time and knowledge, and they’re either not remembering what you said or not giving your interactions the proper focus and attention. Doing this once or twice is obviously OK, but if it becomes a pattern, they are simply not listening. You should move on and save yourself the headache.

A borrow who asks the same questions may be annoying but so can a borrower who asks for too many favors. When you present a solid deal, and the borrower asks you to go above and beyond every time, seeking out special treatment on every deal, that’s not a recipe for success. Sometimes it’s OK to go the extra mile and request an exception from your treasury or underwriting team. However, giving a borrower a lower rate or max LTV on every deal makes the relationship one-sided. A borrower who expects royal treatment every time you pick up the phone becomes detrimental to the rest of your pipeline. Instead of being able to help several of your clients each, you may get stuck trying to appease just one borrower.

There are so many nuances when dealing with a borrower in any given deal scenario. Understanding how to handle them to master your craft is something you learn over time and through experience. Borrowers are essential to your bottom line and that of your company, so perfecting borrower relationships, being able to get a deal back on track, or stopping it in its tracks when needed may be the difference between your success and failure in the industry.