Building a Solid Referral Network After You Start Your Loan Brokering Business

One of the keys to running a successful commercial loan brokerage is building a solid referral network. What this should mean to you as you start your new commercial finance business is that you need to understand the challenges, aspirations, and goals, of your referral sources. You also need to be hyper-responsive in your communications with them after they refer a deal to you as a business loan broker.

Point 1 – Salespeople want to keep control of their sales cycle!!!!!

Most polished salespeople, whether they sell equipment or commercial real estate know what it means to “control the sale”. They know the processes that need to take place on every transaction and how to control the process to the best of their ability. As soon as they refer their client to you for financing, they lose control of the sale and the burden of responsibility falls on you as their “go-to” finance guy or girl. So how do you keep your referral source feeling secure about your handling of their precious sales prospect?

Here are some ways to put them at ease (and keep them coming back):

  1. First, know, and be closely aligned with their sales processes. Know their delivery, install, or possible closing dates. Know if there are any pressing deadlines that they have to meet. Know the deal.
  2. Keep them consistently informed of what is transpiring as you work your process through your pipeline. Each step you take in your process (quoting, collecting credit info, waiting on information from their client, waiting on approvals, issues with the credit, waiting on documentation, etc..) all require a phone call and/or email from you to keep the referral source involved and informed. This sometimes feel like it could be overkill but it still is considered a best practice in our business.
  3. Make sure you are working quickly and diligently on their behalf. Win fast, or lose fast. The referral source will appreciate it and they also will appreciate your fast responsiveness.

Your ability to be responsive and your ability to communicate what is happening during every step of the transaction will give your referral source a sense that they are still in control of the transaction and you will be viewed as a critical step in their sales process. You do not want to be the step or person that creates hurdles or slows down their ability to earn the commissions they so desperately seek in their careers and livelihoods.

Point 2 – When you close a deal (and sometimes even when you don’t close a deal) try to reward the referral source with something worthwhile.

Unless it is not allowed by the referral sources employer, think about a Pavlovian approach to your referral source. Early in my career in brokering loans, I learned the value of sending something worthwhile to those who were good to me. I used many tactics in this area. It might have been 18 holes of golf at my country club (or a well-known course in the area), a nice dinner with our spouses, four Steeler tickets for the upcoming game (sometimes with me and sometimes without me), a fresh turkey at Thanksgiving time, and/or buying and gifting one of their favorite clubs for golf. It was a way for me to show my appreciation for being their finance partner and would always cement relationships that might have otherwise been mediocre.

Point 3 – Stay in touch with them by feeding them good information that will make them better at their jobs.

It has been a common practice through my entire career (yes, even prior to all the easy ways there are to share information today) for me to share information with my referral sources when I thought it would help them in their personal growth or their companies growth. Sometimes it was just something that I thought that they would find interesting and/or sometimes even funny. This brings a personal element to the relationship. There are a number of examples of what type of information you could choose to share with them. It could include something about the college they attended (look on LinkedIn), or a subject or hobby they were interested in. It could be something their competitor is doing (be careful with this if you have a relationship with their competitor as well because you don’t want to be known as the person who gives out vital information to the competition) this could include something you read about their competitor or their industry in a local newspaper or trade magazine or possibly something that is a kind of “the word on the street” type of information. It could be a sales training tip that you are familiar with or read about. It might be a known sales lead or just a possible lead for their product (or a property that might be going up for sale). This consistent friendly touch makes you one of the team and really can make you more integrated into their lives and sales processes.  For many of the newer students who attend my “Life-Pivot” Mastermind Course, and who are nervous about creating their first referral relationships, I always say “try to make friends with your referral sources first, the business will follow”.

If you keep these three points in mind, your referral sources will become much more inclined to refer business to you over your competitor and the relationships you create within your business will make your business life much more rewarding. It is a key to building a successful commercial finance company.

If you have any questions about starting a commercial finance company or are interested in attending my “Life-Pivot” Business Loan Brokering Mastermind course, please email me at sglover@BizLoanConsultants.com.

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