From ‘Maybe Later’ to ‘Yes’: Building a Stronger Pipeline with Credit Optimization

You work hard to keep that pipeline growing, but at some point, it just stops. You might find yourself with many potential borrowers, but no one is quite ready to pull the trigger, so you are stuck in a stalemate and not closing nearly as many deals as you’d hoped.

Now what?

The key is to get creative so you never get to this point. You know borrowers are constantly coming and going. Once you close them out, you move on to the next set. That’s why a big part of a loan officer’s job is always looking for new business.

If marketing isn’t your thing, or you think I just don’t have time, consider credit optimization and how it can help your pipeline grow.

What is Credit Optimization?

Credit optimization simply means making the most of a borrower’s credit score. There isn’t a one-size-fits-all approach to doing this, which is why CreditXpert offers such value. You can run hundreds of data points to help your clients determine the best way to improve their scores.

While you can always offer sage advice, such as paying off debt or cleaning up their payment history, there are hundreds of other data points and ways to help clients maximize their credit scores.

A Constantly Growing Pipeline Is Key

How would credit optimization help increase your pipeline?

Consider this scenario.

Joe thinks he wants to buy a house but is on the fence. You run his credit for pre-approval and find that what he qualifies for is outside what he’s comfortable affording. Normally, Joe would go on his merry way, and you’d continue looking for other clients.

But instead, you encourage Joe to optimize his credit over the next few months. You also give him tips on how much money he should save for the down payment or even to buy down his rate.

Joe remains in your pipeline and works with you to optimize his credit. After three months, he had the credit score needed to qualify for a better loan program and rate. He finds his dream house, and you close the loan, all because you offered credit optimization.

Types of Borrowers Which Credit Optimization Can Help

Joe isn’t the only type of customer credit optimization that can help. Here are the various types of clients you may want to target and keep in your pipeline by offering this service.

Borrowers Who Aren’t Ready to Pull the Trigger

Not all potential borrowers are ready to buy a house. It’s a big decision, and some just get nervous about it.

If you have borrowers like this, rather than pushing them off and maybe reaching out six months down the road, you can stay in touch with them and help them improve their credit in the meantime.

They don’t have to be “bad credit borrowers” to offer this service. Everyone can benefit from a higher credit score, whether it’s to qualify for a better loan program, to put less money down on the house, or to get a lower interest rate.

Borrowers Who Don’t Qualify for a Loan Yet

We’ve all encountered borrowers who just don’t qualify, but that doesn’t mean they can’t qualify in the future. Sometimes, it’s as simple as clearing up their payment history and encouraging them to make payments at specific times to improve their payment history and reduce their credit utilization rate.

Other times, it may be more challenging because their credit score is pretty low, but after running several scenarios, you can help them understand the best way to improve their score fast so they can become homeowners.

Borrowers Who Want a Lower Interest Rate

If you asked most potential borrowers, the one thing they would say is most important to them is a lower interest rate. Sometimes, the rate is what stands in the way of a borrower closing on a house. Either the borrower doesn’t want a rate that high, or they want to do whatever they can to save money.

Offering credit optimization is a great way to keep these borrowers in your pipeline even when rates are high. They may qualify for a lower rate with a few simple steps, hitting the rate they want and making them ready to close.

Borrowers Who Need a Lower DTI

Debt-to-income ratios can often prevent borrowers from qualifying for a loan. If you have borrowers who are on the fence or who are given a higher rate because of their DTI, credit optimization may help them get where they need to be.

A lower DTI allows lower interest rates and sometimes even better loan programs. Offering this value-added service may give you the leading edge.

Everyone can Benefit from Credit Optimization

There isn’t one borrower in existence who couldn’t benefit from credit optimization. Even if you have borrowers with high credit scores, there could be reasons optimizing their credit could help, such as a lower interest rate or lower DTI.

Offering this service shows potential borrowers you think of them as more than a number. You care about your clients and want to help them make homeownership a reality in their lives in the most affordable way possible.