The other day I received a marketing email from a commercial mortgage broker trying to drum up business. The email was a PERFECT example of what NOT to do. As one of my trainees put it, "This guy is doing everything back-ass-wards!"First let me give you some background. If you have been reading my recent blog posts about succeeding as a commercial mortgage broker, you will recall that I have been pounding on several consistent themes:
- A commercial loan broker must only work on do-able commercial loans. What is a do-able commercial loan today? A do-able deal is a small commercial loan (less than $5MM) secured by a standing commercial property.
- Goofy loans are the opposite of do-able loans. Goofy loans include international loans, construction loans, loans on mines, large loans (loans over $5MM), acquistion and development loans (A&D loans), land loans, joint ventures, daisy chains, and any other commercial loans that are not your standard, garden variety, bread-and-butter fare.
- If a commercial mortgage broker is not working on a do-able loan, he simply must be working on his marketing. Commercial mortgage brokers should devote 60% or more of their time to marketing.
- The successful commercial mortgage broker knows how to say, "No." The most valuable asset possessed by a commercial mortgage broker is his time. He doesn't waste it by working on goofy loans. Instead, he uses that precious time to call on bankers, commercial realtors, and property managers - either in person, over the phone, by snail mail, or by email - and adds them religiously to his growing email/snail mail list of referral contacts.
Okay, so now let me tell you about this advertising email I received from this commercial mortgage broker. This guy was actually soliciting for the very same goofy loans that I have trained you to avoid like the plague! He advertised for -
- International loans
- Construction loans
- Land loans
- Acquistion and development loans
- Venture capital
- Loan on mines!
- Loans on special use property, like energy projects.
- And his advertisement was directed at other mortgage brokers asking them to bring their commercial loans to him to place. In other words, this foolish broker was intentionally setting himself up to be a commercial mortgage wholesaler. You never-ever-ever want to work as a commercial mortgage wholesaler.
- By tailoring his advertisements to mortgage brokers, he is intentionally creating a daisy chain. Daisy chains don't close!
Oh, my goodness! Talk about being on a path to disappointment and poverty. Folks, you could work on 10,000 commercial loans from the above list and never close a single one. This broker was the perfect example of what NOT to do as a commercial mortgage broker.
You should only be working on permanent loans and bridge loans on standing commercial properties in this market. If you waste your precious time working on any other kind of commercial loan, mark my words. You. Will. Starve.
If this broker's advertisement was not funny enough, the headline of his advertisement was the pièce de résistance. The headline read, WE ARE IN BUSINESS! COMCAST MISTAKENLY TURNED OFF OUR PHONE. I am shocked - shocked I tell you - that this commercial mortgage broker may be having trouble paying his bills.
C'mon, guys. Don't work on goofy loans. If you're not working on a loan on a standing commercial property, be working on your marketing.