Most people struggle with their mortgages because of a lack of proper wealth strategy. Time to end this old and ineffective mortgage approach in favor of a brand new one that actually leads to financial freedom. Joining Jen Du Plessis is Ryan Grant, Division President at NEO Home Loans. He talks about making mortgages more manageable by increasing financial literacy and giving the non-QM market a serious try. Ryan talks about his leadership style and how he influences others to work better according to the team’s overall mission. He even shares his platform, The Art of Home Ownership, where he guides mortgage professionals to hone their skills and build credibility that every potential client will certainly appreciate.
Looking for some help? Jen is seeking individuals who would like to be featured as a panelist on the show for her Mortgage Lending Mastery Mastermind Series. Email Support@KineticSparkConsulting.com to get scheduled!
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A Brand New Mortgage Approach With Ryan Grant
I want to say thank you so much for reading all these years. We’re on our eighth anniversary, if you can believe it. It’s great. It’s always a good time to celebrate but I am delighted that you spent time in your day with us. If you’re brand new, welcome to our community. If you’ve been with us for a long time, thank you so much for your patronage.
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On this episode, I want to introduce our guest, Ryan Grant, who is the CEO and Founder of NEO Home Loans. Let me take this opportunity to introduce him. He has consistently been ranked in the top 150 lenders in the country for the past years. He and his co-founders created NEO Home Loans in 2020. We’re going to find out about that. I’m excited about it but one of the things that they tout is that they’re uniquely valuable mortgage platform and to fundamentally change the perception of what it means to be a mortgage professional. I want to hear about that.
You are growing and you also have a platform that you developed called the Art of Home Ownership that we’re going to talk about. If you’re a loan officer reading in, this is an awesome opportunity for you to consider another platform. I say all the time, don’t chase shiny objects. Make sure that it fits your budget and aligns with your values and goals before you take the plunge into getting something that is brand new. We are delighted to have you here, Ryan. Thank you so much for joining us.
Thank you for having me. I’m excited. I’ve known you and your show for a long time. I’m honored to be a part of it.
We’re going to dive right in. You’ve been in the business for years but you had what you considered this double career in the business. Tell us about your first career in the mortgage business and how that differs from what you’re doing now.A career is when you have your own brand. It's built on relationships and not on performance. Click To Tweet
The first iteration of my time in the mortgage industry was a job. I had a job as a loan officer, subprime mortgage company back in 2005, 2006. I got in the management of that and then the subprime crisis happened. I floundered for a few years, went into management and a couple of other companies but had a very tumultuous first 5, 6 years in the industry.
I thought about getting out of it multiple times. It was one point where I was going to go back to business school. My dad told me, “Why don’t you go meet realtors, try and have people refer you business?” I looked at him. I was like, “I don’t think that’s even a thing.” You send out mails or buy internet leads into refinances. That’s all I knew. Needless to say, there was more to it than that and I’m glad I listened to my dad.
In 2011, that’s when I started my career. I consider anyone in the mortgage business, you’d have to look at it if you have a career or a job. A job is when you work for a company and they provide you leads. They give you the opportunity. You try and convert that business. A career is when you have your own brand and you’re generating your business. It’s built on relationships and not built on performance. That career started in 2011.
What I’ve always said for years and years is that I have a practice. I don’t have a business in those levels as professionals in this industry to say, like an attorney or a doctor has a practice. We’re serious about what we’re doing and that’s what this show is all about. I love that you made that transition. How hard was it for you to transfer?
Here’s why I’m asking this question. The terminology is changing, I got back from a non-QM conference and they said, “It’s going to be called non-agency now.” Non-agency, non-QM, this is blasting off. I still originate under that hospice without a license. I only do non-owner occupied properties but I do quite a bit of business in that arena.
I love non-QM for investors. That was one of my niches but what I’m seeing is that it’s a difficult transition for most loan officers who have only sold rate while we’ve had this low rate environment for umpteen years. When I got in, it was 18.5%. They’ve had these low rates and all they were doing is low rates 30-year fixed rate loans. When you make that transition into the non-QM world, the old phraseology of subprime is not subprime anymore.
In fact, the credit scores are better than agency loans and the LTVs are lower but when you make that transition, what people and loan officers are doing is they’re saying, “This non-QM is out there. I’ve got to start making that transition.” It’s a different approach to edge selling. I want two questions answered. What recommendations would you give to them if they approach that but first answer, how did you transition from situational lending into being more of a commodity?
It was a new journey for sure. I started with a company called iMortgage in 2011. They were well-known for relationship based lending. They understand purchase business. I remember getting my first business card, a couple of flyers and then went to a broker preview. I was nervous. People could see that thing shaking in my hand. I would sit outside of open houses and tell myself all the reasons why I shouldn’t go in and then I’d leave.
It took a while for me to find my place there. It was through being at a lot of events, going to every open house possible. Anytime there was a realtor, a buyer or any opportunity, I was going to be there. Then I focused on customer service for the thought that can differentiate us and that got us to a certain place. We kept growing in the mortgage practice.
It wasn’t until around 2018 where I realized that we were a commodity. We were looked at from a rate and cost perspective more than I would care. Even though people liked our customer service, it wasn’t all that important to them. They wanted the deal done and a decent enough customer service level. That’s when I realized that we have to tangibly be more valuable to the client.
I tell everybody, if a client comes to you and says, “I’m getting a low rate quote. I’m already in contract. They can close in fifteen days. They have awesome customer service and they have an on-time close guarantee. Why you?” Back then, I didn’t have that answer. I couldn’t have overcome that objection or client concern. Now, I can confidently say that we do. We believe that we’re going to be the most valuable person in our client’s life along with our build state partners oftentimes when it comes to somebody’s real estate or financial livelihood.
We can show them that we’re going to be important to them for the next 30 days but we’re going to be invaluable to them for the next 30 years. People want mortgages but that’s not what they need. What they need in order to create wealth is information, continual advice and proactive guidance. We’ve built our entire company around the fact that we want to help people achieve financial freedom through a lifetime of guidance and financial literacy.
It is funny that you’re saying this because a lot of times, both real estate and mortgage because we have realtors who are reading as well, is that we’re so transactional. We get a lead, we close a loan. I always look at the client journey as being an infinity sign that they’re alumni clients and not past clients. We don’t close the casket on the relationship.
We bring them back into the fold. What do alumni do? They return, give you money and refer people they want and your advocate. That’s how I always look at the process. I love that you’re taking that approach. It is a lender for life without saying it’s a lender for life. Truly what it is to be there through thick and thin. You made that change.
Let’s answer the second part of the question. I’m used to being in a commodity. I’ve been quoting a whole bunch of rates and going 100 miles an hour. “I had the best year ever because Kobe gave it to me in 2020.” Then I’m going, “What do I do?” I heard there’s this non-QM market. “That’s what I’ll do. I’m going to jump into that.” What advice do you have for them for changing their mindset, tactics and strategies to be successful in that arena?
Personally, there’s an opportunity to still be extremely relevant and demanded from an agency perspective. I don’t think that fully jumping into non-QM is the answer. It’s an alternative of the value proposition that will differentiate you, which unfortunately, most lenders don’t have. Then they think, “I’m going to go full bore into non-QM and try to be in that space.” You’re going to run into the same challenge because there’s still going to be people out there that offer that.
Wherever you spend your time, if you want to create maybe 10% to 20% of your business portfolio in that non-QM space, that’s prudent. Everybody should have those outlets because you want to help as many families as you possibly can and every family is going to have a different circumstance. The key is that family needs to understand that you have product differentiation, value differentiation and that they will be better off partnering with you in their real estate and financial journey than anybody else.Never hire team members you just want to manage but those you want to lead as well. Click To Tweet
Whether you’re quoting a 4.5% rate on a non-QM product or a 3.5% rate on an agency product, never expect to be the cheapest. That’s the game that we’re all trying to somehow play but no one’s ever going to win and we’re racing to the bottom. The key is to never try and beat your competition. It’s simply to make them irrelevant. Sell a different product. Get in that blue ocean that most people are not going to get into and then have every product available to you to be able to maximize your efficiency with your clients.
I’m smiling about this because I’m no longer originating in traditional. This is the problem to begin with because my agents never did that. They trained them not to do that but if they were calling and saying, “What’s your rate?” One of the first things I’d say is, “Have you talked to any other lenders?” “I’ve talked to a whole bunch or pay grade.” “Did they tell you about the Super Saver 25?”
“No. They didn’t tell me about them. What’s that loan?” It’s simply a 25-year term. It’s the exact same rate but it’s selling them something different. I would talk to them about it and say, “You can own your house five years sooner.” We know that’s not the real answer. Exponentially, your balance is paying off. I always found that was a fun thing to do to someone who called about rate.
The key there is we call them disruptor questions. If you go online and type in how to find the best mortgage lender, you’re going to get twenty pages of rate term costs, so on and so forth. Nothing’s going to talk about value, education, proactive advice or guidance. The consumer has no other idea what to ask other than rate and costs.
We need to ask them a question that will disrupt their thought pattern and realize there’s more to this than anyone else asks. We have twelve disruptive questions that we teach all of our mortgage professionals’ tasks situationally. Those questions get the client to realize, “No one else is asking these questions. They seem incredibly important. Maybe no one else is taking the time to consider my personal financial situation versus another client so I want to learn more.” It opens them up and allows them to be more receptive.
It’s making a withdrawal from the trust account of that other lender without you having to even be around. It’s pulling the trust right there going, “I wonder why they didn’t ask me. I wonder what’s going on with that. Didn’t they ask you? I wonder why they didn’t.” Those were little innuendos I used to use as well as top producer too. Thank you for sharing that because I do think it’s a different strategy. I’m not saying go full in. I’m saying that it is a different strategy.
In fact, my company’s called situational lending because that’s what it is. It’s not a rate quote environment, although I’m starting to see that from our vendors. I’ve never had them talk to me about rates but what they do is talk about rates. They’re trying the Kool-Aid themselves. I want to go back to something that you said, which was management. You were involved in a lot of management. The reason why I want to talk about this is that 2021 has been the year of leadership.
This has been the year of leveling yourself up to be a leader in a relationship, to be the leader in your family, to take the lead and to have 10 or 20 seconds of courage rather than a full year of fear to be the person who is in the forefront and the visionary. My opinion of management is that the word is gone. It’s old news. It’s all about leadership. Tell us about your leadership, relationships with your real referral partners, relationships with people in your branch and in your company and how you see leadership going forward from the perspective of a realtor for their practice and a loan officer for theirs.
We have a philosophy at NEO that we don’t want to hire anyone we have to manage. We want to hire a leader that we get to lead. It’s important because so many companies have multiple layers of management and everybody’s got to have oversight and everyone has to babysit certain people or try and get the most out of them. The philosophy that we realized early on was not going to knock on a five for us. We look at whether it’s our employees, referral partners or anybody in our world. We asked three questions. Do they feel inspired when they wake up? Do they feel safe when they’re at work? Do they feel fulfilled when they go home?
The reason we created NEO is because it’s inspirational to know that we can make an impact on so many families’ lives and not just sell them debt. When I asked loan officers why they do what they do, they’re like, “I love helping people.” Then I’m like, “I hate to burst your bubble but if they don’t get their loan from you, they’re going to get it from someone else. Tell me how you’re outside of completing the transaction. Are you actually helping that client? If you’re giving them what they want, which is a mortgage, that’s not helping them. You need to give them what they need, which is way more than just a mortgage.”
We’re all inspired to try and change the mortgage industry. Redefine what a mortgage professional should be. Everyone feels very safe because they know that when the market gets challenging, not only will loan officers and our realtor partners need a value proposition but our clients will not only stay with us but refer at a high level that we get to work with companies and organizations as their corporate affinity partner. We have a lot of CPAs, financial planners and estate planning attorneys that work closely with us because of our value proposition. Everybody feels safe that we’re not at the whim of interest rates. Our business has elevated up beyond that commoditization.
Lastly, everyone feels very fulfilled with the work that we do. I’m getting to see families move their financial freedom score up and getting to communicate with all of our employees. We do a financial freedom webinar once a month with every person in NEO. We have underwriters, closers and funders that have said, “I’ve been in this industry for twenty years and no company has ever decided to take the time to help me with my personal finances.”
They’re buying investment properties. They’re opening savings accounts or investing in a 401(k) for the first time in twenty years because they didn’t feel safe and empowered. Everybody has a high level of fulfillment. We’re at the beginning of that. The more we focus on those three key indicators, leadership becomes easier when those three things are always in the forefront.
I trained a group of realtors. I’ll say about 80 of them or so. We talked about financial freedom and what that meant for everyone. It’s funny because a lot of people think financial freedom means millions and millions of dollars but that’s not the definition of financial freedom. You can have financial freedom with a $50,000 or $65,000 salary.
It’s about not consuming but conserving. It’s being aware. It’s looking at things. I love that. Do you consider that to be NEO’s core values? I wrote down values and then you started spewing those down. I’m like, “They sound like core values. These are your non-negotiables.” Motivation is temporary and it’s a vicious circle. Inspiration is from inside.
People have to experience this. We have a NEO employee loan program where the client gets to go through the full NEO experience like the dreams and goals call, which is 20 to 30 minutes of asking them questions that most loan officers would never dream to ask and we understand why. They would do a 45-minute to 1-hour long consultation where we go over exactly what we think they should do. They have a contract meeting when they go into not getting the offer accepted. We have what’s called a Bulletproof Buyer Program.
We increase the likelihood of them getting the offer accepted, decrease the cost likely at which they’ll pay for that home and then when we close to transact. We were all the way through. We have unique gifting programs so they can experience the joy of becoming a homeowner as opposed to the stress and anxiety.
We do a post-closing call at closing, where we spend about 20 to 30 minutes explaining the next 20 to 30 years of our engagement, relationship, what they’re going to get from us and why they need to utilize it in our customer success team, calls them 3 months, 6 months, annual financial reviews every single year. We can’t change this industry if our own employees don’t feel the difference and don’t feel like they are a part of something unique and special.
When we do that, our underwriters underwrite differently. Our closers and funders work for different reasons. Our processors realized what they were accomplishing because they’ve been through it themselves. One of our core tenets is the employees need to feel it first, then we build our relief in there.The real estate industry cannot be changed on your terms. What you can do is build an effective team that can feel the change you want. Click To Tweet
It’s certainly traditional, calling after closing 3 months, 6 months in a review but it’s the way you do it. It’s the uniqueness behind how you do it that makes you different from the next loan officer. I want to make sure that loan officers are knowing this and realtors too. Many times you’ve heard, call a closing, call three days after, calls a month after and they get their mortgage statement. In 3 or 6 months, how are they doing? Then the annual review is year after year.
It’s how you do it that makes it so unique. If you make it part of an automated system and they don’t feel that you’re showing that you care, it can fall a little more flat than having the actual phone calls that show that you care for them. One of the things I used to do was talk to my clients about it into entrance, holding an exit strategy for each home. That’s what you’re talking about.
When you have a holding strategy, it gives you purpose to call. You have a purpose that you’re calling because you’re working that holding strategy to create wealth and that exit strategy of, “Is this house going to be an investment? Are we going to use all of the proceeds? Are we going to use some of the proceeds to buy the next house?
What does the next house look like? How far down the road? How long will you have the mortgage versus the home? Do we have a band-aid loan to get you in?” The uniqueness in how you do it on the backside is what creates that infinity of the loyal client that comes back again and refers their friends. That’s super powerful.
In the time that we have left, I want to ask you about the Art of Home Ownership. This is your opportunity to give a little pitch on this. I’m going to give the high level of this. This is a platform that you have for selling different products on the backside of the closing. I call it a concierge. I know you call it something different. Talk to us about what this program is and some of the details about how people would join.
Prior to starting NEO Home Loans, I was losing clients to interest rate, even though they didn’t want my customer service. Even though I was one of the top 25 lenders in the country in many years, I wasn’t proud of what I did. I wasn’t proud that I distilled more depth than other people. I knew that I needed to be more valuable to my clients. A) To even feel good about what I was doing and then feel like I had some purpose. B) It was what they needed.
I knew when my clients are happy. I remember vividly a client called and says, “We have to sell our home.” I helped her buy the home a year previously. The husband passed away in a car accident. I said, “I’m so sorry but we need your life insurance come in and step in.” She said, “We don’t have life insurance.” Right at that moment, you couldn’t tell me that it wasn’t my fault because I knew about life insurance. I could have simply asked her one more question on the upfront discovery call. I could have asked her one more question on the closing call. I could have followed up and encouraged her and the family to do that.
If I would’ve done that, she’d still be in that home with her kids but because I didn’t think that was my job or I didn’t see the necessity of it, that happened. We need to be more beneficial and valuable to our clients. We compiled a list of 30. We looked at every pain point that we knew the consumer had, which was home maintenance, home repair and home upkeep. 63% of Millennials, 42% of every homeowner has some form of regret within twelve months after buying a home. That’s the number one regret. Let’s solve that.
Not understanding their home equity or what they can or should do with it, complacency in home ownership. We knew that was a massive problem, so we found a way to solve for that. Not having a proactive real estate or financial goals, buying a home, living in, paying for it and then letting life happen. We knew we needed to solve for that, helping people manage their mortgage at a high level. We call it a perfect mortgage promise. Having people move from one home to the next, moving as 1 of the 3 most stressful activities in life. Very few people help their clients with that, if at all.
There are two other parts to it, which are helping someone to renovate their home prior to selling it to maximize the sales price at no cost to the client and then helping someone trade up to get their new longer-term home without having to sell their departing residence, essentially buying the new home for them all cash and then allowing them to move into it and having time to sell their apartment residence. We solve for every one of those areas with Art of Home Ownership.
When we talk to our clients, we can show them how we can make or save them ten times the amount of money that they would ever think they’d save by going with the cheaper lender. Customer service, interest rate, speed, certainty, all those things are great but all those things are what everyone else is doing. We’re all saying and doing the same things. We’re wondering why we’re not getting different results. If you become an Art of Home Ownership partner, you can say and do wildly different things and have much more of an impact.
We became the preferred lender for Facebook and top ten lenders in the country because of that platform. We understand, are connected and engaged with our clients, not just from a transactional level but they’ve become dependent on us at almost every aspect of real estate and finance. Our realtor partners are going to say the same thing. The best thing is the confidence.
I was at the airport and a couple was sitting next to me. They turn and said, “I feel strange not talking to you being so close.” We got into talking and she asked what I did. I said, “I’m changing the mortgage industry.” She looks at her husband. They looked at me and went, “What do you mean?” I explained what we’re doing at NEO and, ultimately, Art of Home Ownership. Any Art of Home Ownership partner gets to say that. Not only did I get to talk with her but we adopted her and her husband as a client. We see the financial planner at Idaho. We’re working together.
Our realtor partners get to say the same thing. I go to our realtor partners and say, “When someone asks you what you do, don’t tell them you sell real estate whether you’re a realtor. Tell them that you’re changing the real estate industry.” They’re like, “How do I do that? How am I doing that?” I said, “Because you’re partnering with us, all the things we’re doing are all the things you’re doing.” It’s a total dynamic shift. We don’t want to beat the competition. We just want to make them relevant.
Anytime you can answer a question like that, it’s the puppy dog thing. If you say you want to go for a ride, you want to go for a walk and they go, “What? That sounds interesting.” It’s so much better and that’s something that I teach in my coaching all the time. Please don’t answer them as a mortgage lender because the response is natural. “My rate is this. I can’t qualify.”
It’s always the same thing. It puts the walls up and creates a stereotype. We want to break that mold. I know that you have to run because I see the time and you’re about ready to do a presentation yourself. I want to value your time. I want to ask you this last question. What do you do that keeps you on top of your game?
It’s discipline, routine and constant improvement. I’ve never for a second thought that I know it all. I quite often think of the alternative. I have invested a lot in coaching. We even started a coaching company. We believe that the constant pursuit of improvement is the most rewarding and fascinating thing that we can do because the industry and dynamics are always changing. We need to always be on top of our profession. When you have that level of discipline and routine, it will spill over into your personal life as well.
Early morning routines and being very intentional with time and family. I have a beautiful wife and two incredible daughters that I am blessed to be able to spend a lot of time with. I have very intentional nighttime routines. I did the video of the day talking about a couple of safety stops, stopping before we get home, finishing your call, getting into a different frame of mind, going from fifth gear all day at work and the sixth gear when you get home. Little life hacks that allow me to stay engaged in every area, stay healthy and mindful and then practice a lot of gratitude.
It’s the bookends. The chaos can ensue. There can be things that happen during the day that if you can bookend your day and get your head on straight on both sides, that’s how I always described it as bookending your day. In fact, I’ve got a client that I’m coaching. I have her sit in her driveway and write down three gratitudes before she gets out of her car and goes in with her kids. You got to have that transition to be present to everyone when you come into the house because otherwise, we’re still running 100 miles an hour as we do in this industry. Unless you’re in it, you don’t understand it. It can be done over time.
Thank you so much for sharing that with us, Ryan. I wish you the best of luck in everything that you’re doing. I know this is a new venture for you having your own company. I wish you all the best in what I call the soaring twenties. These are the soaring twenties. This is the decade for soaring. If you’re going to be great at personal and professional development, leveling yourself up, being intentional, working to win rather than working to work and differentiating yourself in the marketplace to become a market influencer, this is your decade but you got to work into it. You have to do that.
I thank you so much for spending time with us and sharing your wisdom with us, some great ideas. For those of you that are reading, I thank you so much for reading and spending time with us. I spoke to someone in San Diego and they said, “You’re her.” I was like, “It’s me.” He’s like, “I listen to you every day when I work out.” Jim, if you’re working out at the gym, hi. Thanks for listening in. Ryan, thank you so much for being here with us.
Jen, I appreciate it.
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