October 17, 2024 • 19 mins
Unlock the secrets to expanding your referral network by harnessing an often-overlooked partnership! Stephanie Budnik interviews Gibran Nicholas, founder of Momentifi and creator of the CMPS designation, on the untapped potential of financial advisors as high-quality referral sources for loan officers. Gibran discusses:
- Why financial advisors are an opportunity for high-quality referrals
- How to approach financial advisors about partnerships
- How to prove your value to financial advisors
- How to earn financial advisor referrals by offering CE credit classes as a CMPS-certified instructor
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Stephanie Budnik (00:04):
Welcome to Mortgage Connects by MGIC,
bringing you the latest insightsfrom top mortgage professionals
around the industry.
I'm your host, tephanie Budnick, and in today's episode we're
going to explore an oftenoverlooked but a very high
potential referral partnershipthe synergy between loan
officers and financial advisors.
With us today to help us onthis topic, we have Jabron
(00:25):
Nicholas.
Jabron is the founder ofMomentify and the creator of a
CMPS designation, which is thenumber one certification in the
mortgage industry that helpsloan officers stand apart from
their competition and close moreloans from financial advisors
and other high-quality referralpartners.
More than 10,000 top producershave graduated from Gibran's
(00:48):
training and coaching programs.
Gibran is also the best-sellingauthor of the Storytelling
Adventures, which helps you andyour team use examples of
storytelling to stay inspired,to find more meaning in your
work and to grow your business.
Gibran lives in Alpharetta,georgia, with his wife, mandy,
and their three children.
Welcome, jabron, I'm so happyto have you here today.
(01:10):
I am really excited to go intothis untapped market that I
think a lot of peopleunderestimate.
Gibran Nicholas (01:15):
Well, thanks, Stephanie.
I appreciate you having me on.
I'm super excited about ourtime together.
I think this is going to besuper useful to a lot of loan
officers right now who arewondering how to grow business
as we approach 2025.
Stephanie Budnik (01:27):
Yeah, I know that that's a big question and
with you know, with how muchthings continue to change, it's
good to have a couple differentstrategies in your back pocket.
And so, as you know, we kind oftalked about at the beginning
of just the episode, we'rereally going to look into a high
potential for how loan officerscan partner with financial
advisors, and so the firstquestion I actually wanted to
(01:48):
ask you was what makes financialadvisors a really great
referral partner source for loanofficers today?
Gibran Nicholas (01:56):
Well, great question and I think it really
boils down to the quality of thereferral that you're going to
receive from a financial advisorversus any other source.
When you think about who usesfinancial planners is people who
have money to invest, peoplewho own businesses that have
taxes they want to save money onand they're calling their
(02:17):
financial advisors, they'remeeting with their CPA, their
financial planner, and they'retrying to figure out ways of
saving money and they're goingto take the advice that the
advisor is giving to thembecause they're paying for that
advice.
So if there's an opportunityfor that client to save money,
the advisor looks like a genius.
By connecting the client withyou, they do their client a
fantastic service and it's ahigher quality referral because
(02:40):
the client's not going to shopyou around because they're
already paying the advisor fortheir financial advice.
So when you think about theaverage financial planner, let's
say they might have 100 clientsin their database that's in any
given databases 10% of thatdatabase is gonna transact on an
annual basis, whether it's apurchase loan or if you're in a
refi market.
(03:01):
Numbers go through the roof ofpeople who are trying to get
refinances.
But figure 100 clients in afinancial planners database, 10%
of them 12% of them are goingto buy a house this year, the
next 12 months.
Who are they going to talk toabout their mortgage?
It should be you.
Why shouldn't it be you?
And that's the beauty of workingwith financial planners is,
number one, the referral qualityis a lot higher than you would
(03:22):
get otherwise.
The client's not going to shopyou around.
And number two, the opportunityis untapped because most loan
officers are approachingrealtors and they're calling on
realtor doors or every other.
You go to a realtor networkingmeeting, every person there is a
loan officer, right?
So that's what you call a redocean, whereas working with
(03:44):
financial planners, it's like ablue ocean.
This comes from the book BlueOcean Strategies, where a red
ocean is a highly saturatedmarket, lots of competition.
People are very price sensitiveand you're going to get crushed
.
You're going to get eaten bythe sharks.
It's a red ocean because of allthe blood in the water.
There's a blue ocean hugeopportunity, not as much
(04:04):
competition, and you're going tobe one of the only people in
your market who are going afterthis great referral source.
Stephanie Budnik (04:12):
That's why we're so excited about it to
diligently save and work withsomebody like a financial
planner to get to the goals thatthey want.
You know it's that, isn't theobstacle that you're having to
overcome, maybe as much to startthe process, you know, starting
(04:32):
a less up hill battle.
Gibran Nicholas (04:35):
Yeah, I mean when you think about it.
National Association ofRealtors says that last month,
26% of home buyers paid cash fortheir house.
These are people who haveassets, they have great credit
and they're wondering, hey,should I liquidate my investment
account, take a million dollarsand put it into the real estate
market?
Or what should I do?
And if you could be thereoffering the financial planner
(04:57):
like a cash versus mortgageanalysis on any one of their
clients who's thinking aboutpaying cash for a house?
That's 26% of the market thatyour competition is ignoring
right now?
Right, these people don't evenhave you on their radar screen
because they're going to paycash.
What do they need you for?
But if you can help themunderstand the value of using a
mortgage versus paying cash andyou're not the one necessarily
(05:19):
selling the deal to the customer, the financial planner is
almost talking them into itbecause it makes sense
financially, from a taxstandpoint, from a cashflow
standpoint, and so you work as ateam with a financial advisor
to benefit the client in amarket like this, I mean it's
almost like a no-brainer.
I'm surprised more loanofficers aren't doing it.
Stephanie Budnik (05:40):
I understand the great opportunity here and I
think one of the firstquestions that might come to
mind for a loan officer is howdo you approach a financial
advisor to develop this type ofrelationship and to get on their
radar per se?
Gibran Nicholas (05:54):
That's another great question, because a lot of
loan officers don't even knowwhere to start.
This is a new market.
We're not used to it.
We're used to working withbuilders or realtors Whoever
thought about working withfinancial planners, right?
So where do you find thesepeople?
Great question.
Two ways that I would suggestthat you do this.
The first way is you can joinyour local associations.
There's the Financial PlanningAssociation, FPA.
(06:15):
There's NAFA, nationalAssociation of Insurance and
Financial Advisors.
There's NAPFA, nationalAssociation of Personal
Financial Advisors.
There's your local CPAassociations.
There's all these groups outthere that have networking
events for financial planners.
So you can go out there.
You can join the local group inyour market and one thing
you'll probably find is thatyou'll be one of the only loan
officers in your market who'spart of that group, so you might
(06:35):
get 50 financial planners in aroom.
You one of the only loanofficers in your market who's
part of that group, so you mightget 50 financial planners in a
room.
You might be the only loanofficer, which is a fantastic
way for you to stand apart,build some relationships.
So that's option one.
Option two that I would suggest.
We've had a lot of success.
You know I started in thisbusiness 24 years ago and I did
(06:55):
this in my own personalproduction.
I grew my business to the pointwhere I was doing about 15, 20
loans a month and we've trainedover 10,000 loan officers over
the years to do what I'm goingto share with you next, and this
is where you can actuallyconduct continuing education
workshops for financial plannersin your market.
So they all need CE credits,right.
So CFPs need, I think, 30 hoursevery two years of continuing
(07:17):
ed.
Cpas need continuing education.
So what if you could go outthere and teach them a one-hour
class that is approved forcontinuing education, where they
learn case studies about whythey should refer their clients
to you and they get continuingeducation for it?
So, for instance, when I firststarted in the industry, what I
(07:38):
did is I taught a class.
It was a one-hour class and itwas case study.
So Jane and John are getting adivorce.
Should she refinance the houseand buy out the ex-husband or
sell the house or so-and-so?
Is thinking about pulling cashout of her retirement account
for a down payment?
Should she do that or shouldshe use PMI or so-and-so?
(07:59):
Is thinking about putting 50%down on an investment property?
Is it better off to do 30% down.
So you do these case studies,three or four of them in a
one-hour presentation, and youget it approved for continuing
education.
Now the awesome thing is youdon't have to start from scratch
because we already do this.
One of the things at my companythat we do it's we have the
certifications called CMPS orcertified mortgage planning
(08:21):
specialist, and you join ourgroup and you get eight done for
you presentation.
So eight hours of CE that youcan teach.
You don't have to do anythingother than you pull down the
PowerPoint from our website,read the script and teach the
class and we report the CEcredits under our school.
So again, two ways you can findadvisors and work with them.
Number one, you can go out andjoin their associations.
(08:42):
Or, number two, you can teachthem these CE classes.
And if you work with a grouplike ours, we've already got
these done for you, classes thatyou don't have to start from
scratch.
We already did a legwork foryou.
Stephanie Budnik (08:54):
But in addition to these CE classes,
how else can a loan officercontinue to provide value?
So it is really a mutualrelationship.
The partnership has grownbetween the two and how can they
, you know, play off of eachother to continue to provide
that added value?
Gibran Nicholas (09:12):
Another great question.
So, once you meet with theadvisor, what do you say at the
meeting to get to turn thatmeeting into a referral
partnership where they havevalue and you have value and
it's a great relationship overtime?
And my best suggestion is thatyou create what's called a real
estate wealth under managementprogram.
(09:32):
You see, financial planners aretaught to manage their clients'
investments, their bonds andtheir stocks and their insurance
and save money on taxes, but noone is teaching the financial
planners how to manage theclient's real estate equity,
whether it's a primary home or avacation home or an investment
property.
And so if you can offer to do afree annual review for every
(09:55):
single one of the financialplanners' clients and build that
into the financial planners'service that they're offering
their clients, this becomestheir way of differentiating
themselves and settingthemselves apart from their
competition and growing theirbusiness right.
So financial planner isstruggling right now with you.
Know how do they differentiatethemselves versus all these
robo-advisors and AI this and AIthat?
(10:16):
And financial planners are alsostruggling with you know what
service do we provide that makesus unique versus all of our
competition?
And the one thing you can dothat they're not doing right now
is, you can help them buildinto their process a real estate
wealth under management.
Where you sit down, you do anannual review for every single
one of their clients reviewtheir assets, review their
(10:37):
liability, their real estateassets, their mortgages, their
debts, their cashflow and thengive the advisor a one page plan
for each of their properties.
And that's something else thatwe can help you with at our
company.
We provide that to you so youcan do like an annual review.
Provide that to the advisorwhere it becomes a part of their
service that differentiatesthemselves from their
competition and this becomes,you know, their reason for
(11:01):
working with you.
Because you know a financialplanner sees themselves like a,
like a quarterback on a team,and they're the quarterback of
the client relationship.
So they work with estateplanning attorneys, they work
with CPAs, they work withinsurance agent.
It's like a resource that theyhave on their team, right, and
so you become the mortgageplanner on their team and the
way you do that is you got tobuild your service into their
(11:23):
process so it becomes a part oftheir service that they're
providing to the client.
That makes them unique in themarket.
Stephanie Budnik (11:29):
And I think that's kind of twofold from a
consultative approach, we talkabout that a lot as a way that
you can be a trusted advisor,whether that be a loan officer
or a financial advisor, and Ithink that the approach that you
talk about allows thatopportunity to happen naturally,
so that they can get that trustin them and feel that there is
(11:50):
value both ways, because I woulddefinitely see that as
something that you could, basedon what you said, stand out
amongst the crowd and reallygrow that partnership.
Gibran Nicholas (12:00):
Yeah, I mean they're always looking for ways
of creating.
I mean, think about how theyget paid right.
A realtor gets paid based on atransaction, so they're very
transactional in their focus.
A financial planner, on theother hand, gets paid over the
lifetime of that clientrelationship.
So they get paid in one of twoways.
Either they charge fees foradvice, so like, for example, I
(12:20):
have a CPA, I pay my CPA Xamount of thousands of dollars
every year.
He does my books every year andI've had that relationship for
20 years.
So figure, if I pay him three4,000 a year for 20 years,
that's my lifetime value to thatCPA.
Same thing with a financialplanner they get paid over the
lifetime of their clientrelationship where, let's say,
(12:42):
they have a client who has amillion dollars invested with
that financial planner, theadvisor charges an asset
management fee, let's say aquarter percent or a half a
percent or 1%.
So they get paid 50 basispoints on that million dollars
every single year that theclient stays with them.
So they're incentivized to keeptheir clients with them for 20,
30 years and have annualconversations and conversations
(13:05):
every six months to create valueon a continuous basis for that
client.
So if you could insert yourselfinto that process, into their
sales process with their clients.
Then you become the integralpart of that advisor
relationship and you don't need50 relationships, you only need
maybe five or six greatrelationships, because these
clients are going to be veryloyal to the advisors that
(13:29):
they're working with right.
So if you can be part of thatteam, that's really what makes
this a unique partnership.
Stephanie Budnik (13:36):
If you're looking to continue to, you know
, make the most of this referralsource as a loan officer.
What types of different topicsdo you feel that they could be
bringing to?
First of all, maybe educatethemselves on, but also bringing
that knowledge to the financialadvisor so that they're more
(13:56):
well-versed, you know,throughout conversations and as
they add these partnerships andparts of their teams together,
yeah, that's another fantasticquestion, because it's almost
like speaking a foreign language, right?
Gibran Nicholas (14:07):
If you're going to go to Spain on vacation, it
would be useful to know a littlebit of Spanish, to be able to
navigate, get around Barcelona,go to the market or whatever.
So same thing with financialplanners.
If you're going to work with afinancial advisor, it's really
useful to understand theirlanguage.
So they speak the language oftaxes.
Everyone is concerned abouttaxes.
How do we save money on taxes?
(14:28):
So the best way to learn thatlanguage is to learn about
mortgage and real estatetaxation.
So, for example, one of thethings that we do at our company
is we have the certificationcourse and it teaches you all
the things that you would needto know to work with financial
planners.
And one of the topics is taxdeductibility of mortgage
interest.
Another topic is the capitalgains tax.
You is tax deductibility ofmortgage interest.
(14:50):
Another topic is the capitalgains tax.
People are waiting.
Should we wait to sell ourhouse or should we sell now?
If they wait, they're going tohave a much bigger capital gains
tax bill, especially if some ofthese proposals come into place
.
We're going to increase capitalgains taxes.
Understanding capital gains tax.
Understanding deductibility ofmortgage interest there's
special rules.
Understanding deductibility ofmortgage interest, their special
rules.
Understanding the opportunitycost of money If you have a
(15:11):
mortgage at 6%, what's theafter-tax cost, how to calculate
the after-tax cost of that andhow does that compare with the
after-tax rate of return oninvestment.
So the opportunity cost ofmoney.
Understanding retirementaccounts and the different types
of IRAs Roth IRAs andconventional IRAs.
And what if somebody is pullingmoney out of a Roth to buy a
house versus a conventional?
(15:31):
How is that taxed and why mightthat not make sense for the
client?
And understanding blendedinterest rates.
If somebody's got a 3.5%mortgage, why would they go to a
6% or 7% mortgage?
Well, the reason is, if theirblended interest rate is higher
with their current debtstructure, with their credit
cards and their car loans andall these things, if you roll
that into the mortgage, even ata 6%, they're going from a 3% to
(15:54):
a 6% mortgage.
It couldn't make sensefinancially.
So understanding blendedinterest rates.
So these are the types ofconversations you end up having
with financial planners that maybe different than the kind of
conversations you might behaving right now with real
estate agents.
Stephanie Budnik (16:12):
Yeah, I would definitely say that those would
be not as similar of topics tocover from a real estate agent
referral partnership versus thefinancial advisor partnership
there.
Gibran Nicholas (16:19):
Yeah, another one is pulling cash out of a
primary home to buy a vacationhome.
A lot of people want to do thatand it might not make sense.
So it might actually make moresense to put a mortgage on a
vacation home, even if you haveto pay PMI, because of the fact
that if you take the cash out ofyour primary home to pay cash
for the vacation home, themortgage interest is not
(16:39):
deductible anymore, right?
So understanding things likethat is really important when
you talk to a financial planner,and these are the types of
things that we cover in our CMPScertification course.
Stephanie Budnik (16:50):
As we close out the episode, I want to give
you an opportunity.
Just anything else that you canthink of that would really help
loan officers take that firststep and take the initiative to
try something new and really tapinto this market.
Gibran Nicholas (17:04):
Yeah, that's a great question.
I think one of the things that Iwould do really quick, if it's
something you're interested inexploring, is talk to your
clients.
Talk to your favorite clients,call up your top 10 favorite
clients and ask them hey, do youhave a financial planner that
you work with?
Say you know what?
I'm expanding my partnershipshere at my company and I'm
(17:26):
looking to meet some greatfinancial planners to refer my
clients to do you have any greatfinancial planners that you
work with?
And if they say yes, great, seeif you can get a referral to
one of the advisors they workwith.
Or if they say no, ask them hey, listen, would you be
interested in getting referredto a financial planner?
If I find a really great one tobring on board with my team,
(17:47):
would you be interested in areferral to a planner?
So now you win both ways A, youcan get an introduction to a
great financial advisor.
Or, b, if they don't work withone, you have a referral ready
to give to the first greatfinancial planner that you meet
with.
So that would be a super simpleway to get started if you're
interested in this topic.
Stephanie Budnik (18:08):
I really like that approach because it also
allows the loan officer to stayconnected to their past clients,
and I think that sometimesthat's a struggle too to think
of different things, todifferentiate yourself, to still
be thought of after thetransaction, and so that's
another great way to just tapinto the wide network or the
wide resources of networking.
So very, very cool.
(18:29):
Well, Gibran, thank you so muchfor your time today.
I think this was veryinsightful.
I hope that people really takethe opportunity to investigate
this and to look into it and seeif it would work for them.
This brings us to the end ofour episode.
So for a recap of this episodeand quick access to related
content, visitMortgageConconnects.
com and you can subscribe foremail alerts so that you can be
(18:52):
among the first to know aboutnew episodes.
Thank you so much for tuning in.
Welcome to Mortgage Connects by MGIC,
bringing you the latest insightsfrom top mortgage professionals
around the industry.
I'm your host, tephanie Budnick, and in today's episode we're
going to explore an oftenoverlooked but a very high
potential referral partnershipthe synergy between loan
officers and financial advisors.
With us today to help us onthis topic, we have Jabron
(00:25):
Nicholas.
Jabron is the founder ofMomentify and the creator of a
CMPS designation, which is thenumber one certification in the
mortgage industry that helpsloan officers stand apart from
their competition and close moreloans from financial advisors
and other high-quality referralpartners.
More than 10,000 top producershave graduated from Gibran's
(00:48):
training and coaching programs.
Gibran is also the best-sellingauthor of the Storytelling
Adventures, which helps you andyour team use examples of
storytelling to stay inspired,to find more meaning in your
work and to grow your business.
Gibran lives in Alpharetta,georgia, with his wife, mandy,
and their three children.
Welcome, jabron, I'm so happyto have you here today.
(01:10):
I am really excited to go intothis untapped market that I
think a lot of peopleunderestimate.
Gibran Nicholas (01:15):
Well, thanks, Stephanie.
I appreciate you having me on.
I'm super excited about ourtime together.
I think this is going to besuper useful to a lot of loan
officers right now who arewondering how to grow business
as we approach 2025.
Stephanie Budnik (01:27):
Yeah, I know that that's a big question and
with you know, with how muchthings continue to change, it's
good to have a couple differentstrategies in your back pocket.
And so, as you know, we kind oftalked about at the beginning
of just the episode, we'rereally going to look into a high
potential for how loan officerscan partner with financial
advisors, and so the firstquestion I actually wanted to
(01:48):
ask you was what makes financialadvisors a really great
referral partner source for loanofficers today?
Gibran Nicholas (01:56):
Well, great question and I think it really
boils down to the quality of thereferral that you're going to
receive from a financial advisorversus any other source.
When you think about who usesfinancial planners is people who
have money to invest, peoplewho own businesses that have
taxes they want to save money onand they're calling their
(02:17):
financial advisors, they'remeeting with their CPA, their
financial planner, and they'retrying to figure out ways of
saving money and they're goingto take the advice that the
advisor is giving to thembecause they're paying for that
advice.
So if there's an opportunityfor that client to save money,
the advisor looks like a genius.
By connecting the client withyou, they do their client a
fantastic service and it's ahigher quality referral because
(02:40):
the client's not going to shopyou around because they're
already paying the advisor fortheir financial advice.
So when you think about theaverage financial planner, let's
say they might have 100 clientsin their database that's in any
given databases 10% of thatdatabase is gonna transact on an
annual basis, whether it's apurchase loan or if you're in a
refi market.
(03:01):
Numbers go through the roof ofpeople who are trying to get
refinances.
But figure 100 clients in afinancial planners database, 10%
of them 12% of them are goingto buy a house this year, the
next 12 months.
Who are they going to talk toabout their mortgage?
It should be you.
Why shouldn't it be you?
And that's the beauty of workingwith financial planners is,
number one, the referral qualityis a lot higher than you would
(03:22):
get otherwise.
The client's not going to shopyou around.
And number two, the opportunityis untapped because most loan
officers are approachingrealtors and they're calling on
realtor doors or every other.
You go to a realtor networkingmeeting, every person there is a
loan officer, right?
So that's what you call a redocean, whereas working with
(03:44):
financial planners, it's like ablue ocean.
This comes from the book BlueOcean Strategies, where a red
ocean is a highly saturatedmarket, lots of competition.
People are very price sensitiveand you're going to get crushed
.
You're going to get eaten bythe sharks.
It's a red ocean because of allthe blood in the water.
There's a blue ocean hugeopportunity, not as much
(04:04):
competition, and you're going tobe one of the only people in
your market who are going afterthis great referral source.
Stephanie Budnik (04:12):
That's why we're so excited about it to
diligently save and work withsomebody like a financial
planner to get to the goals thatthey want.
You know it's that, isn't theobstacle that you're having to
overcome, maybe as much to startthe process, you know, starting
(04:32):
a less up hill battle.
Gibran Nicholas (04:35):
Yeah, I mean when you think about it.
National Association ofRealtors says that last month,
26% of home buyers paid cash fortheir house.
These are people who haveassets, they have great credit
and they're wondering, hey,should I liquidate my investment
account, take a million dollarsand put it into the real estate
market?
Or what should I do?
And if you could be thereoffering the financial planner
(04:57):
like a cash versus mortgageanalysis on any one of their
clients who's thinking aboutpaying cash for a house?
That's 26% of the market thatyour competition is ignoring
right now?
Right, these people don't evenhave you on their radar screen
because they're going to paycash.
What do they need you for?
But if you can help themunderstand the value of using a
mortgage versus paying cash andyou're not the one necessarily
(05:19):
selling the deal to the customer, the financial planner is
almost talking them into itbecause it makes sense
financially, from a taxstandpoint, from a cashflow
standpoint, and so you work as ateam with a financial advisor
to benefit the client in amarket like this, I mean it's
almost like a no-brainer.
I'm surprised more loanofficers aren't doing it.
Stephanie Budnik (05:40):
I understand the great opportunity here and I
think one of the firstquestions that might come to
mind for a loan officer is howdo you approach a financial
advisor to develop this type ofrelationship and to get on their
radar per se?
Gibran Nicholas (05:54):
That's another great question, because a lot of
loan officers don't even knowwhere to start.
This is a new market.
We're not used to it.
We're used to working withbuilders or realtors Whoever
thought about working withfinancial planners, right?
So where do you find thesepeople?
Great question.
Two ways that I would suggestthat you do this.
The first way is you can joinyour local associations.
There's the Financial PlanningAssociation, FPA.
(06:15):
There's NAFA, nationalAssociation of Insurance and
Financial Advisors.
There's NAPFA, nationalAssociation of Personal
Financial Advisors.
There's your local CPAassociations.
There's all these groups outthere that have networking
events for financial planners.
So you can go out there.
You can join the local group inyour market and one thing
you'll probably find is thatyou'll be one of the only loan
officers in your market who'spart of that group, so you might
(06:35):
get 50 financial planners in aroom.
You one of the only loanofficers in your market who's
part of that group, so you mightget 50 financial planners in a
room.
You might be the only loanofficer, which is a fantastic
way for you to stand apart,build some relationships.
So that's option one.
Option two that I would suggest.
We've had a lot of success.
You know I started in thisbusiness 24 years ago and I did
(06:55):
this in my own personalproduction.
I grew my business to the pointwhere I was doing about 15, 20
loans a month and we've trainedover 10,000 loan officers over
the years to do what I'm goingto share with you next, and this
is where you can actuallyconduct continuing education
workshops for financial plannersin your market.
So they all need CE credits,right.
So CFPs need, I think, 30 hoursevery two years of continuing
(07:17):
ed.
Cpas need continuing education.
So what if you could go outthere and teach them a one-hour
class that is approved forcontinuing education, where they
learn case studies about whythey should refer their clients
to you and they get continuingeducation for it?
So, for instance, when I firststarted in the industry, what I
(07:38):
did is I taught a class.
It was a one-hour class and itwas case study.
So Jane and John are getting adivorce.
Should she refinance the houseand buy out the ex-husband or
sell the house or so-and-so?
Is thinking about pulling cashout of her retirement account
for a down payment?
Should she do that or shouldshe use PMI or so-and-so?
(07:59):
Is thinking about putting 50%down on an investment property?
Is it better off to do 30% down.
So you do these case studies,three or four of them in a
one-hour presentation, and youget it approved for continuing
education.
Now the awesome thing is youdon't have to start from scratch
because we already do this.
One of the things at my companythat we do it's we have the
certifications called CMPS orcertified mortgage planning
(08:21):
specialist, and you join ourgroup and you get eight done for
you presentation.
So eight hours of CE that youcan teach.
You don't have to do anythingother than you pull down the
PowerPoint from our website,read the script and teach the
class and we report the CEcredits under our school.
So again, two ways you can findadvisors and work with them.
Number one, you can go out andjoin their associations.
(08:42):
Or, number two, you can teachthem these CE classes.
And if you work with a grouplike ours, we've already got
these done for you, classes thatyou don't have to start from
scratch.
We already did a legwork foryou.
Stephanie Budnik (08:54):
But in addition to these CE classes,
how else can a loan officercontinue to provide value?
So it is really a mutualrelationship.
The partnership has grownbetween the two and how can they
, you know, play off of eachother to continue to provide
that added value?
Gibran Nicholas (09:12):
Another great question.
So, once you meet with theadvisor, what do you say at the
meeting to get to turn thatmeeting into a referral
partnership where they havevalue and you have value and
it's a great relationship overtime?
And my best suggestion is thatyou create what's called a real
estate wealth under managementprogram.
(09:32):
You see, financial planners aretaught to manage their clients'
investments, their bonds andtheir stocks and their insurance
and save money on taxes, but noone is teaching the financial
planners how to manage theclient's real estate equity,
whether it's a primary home or avacation home or an investment
property.
And so if you can offer to do afree annual review for every
(09:55):
single one of the financialplanners' clients and build that
into the financial planners'service that they're offering
their clients, this becomestheir way of differentiating
themselves and settingthemselves apart from their
competition and growing theirbusiness right.
So financial planner isstruggling right now with you.
Know how do they differentiatethemselves versus all these
robo-advisors and AI this and AIthat?
(10:16):
And financial planners are alsostruggling with you know what
service do we provide that makesus unique versus all of our
competition?
And the one thing you can dothat they're not doing right now
is, you can help them buildinto their process a real estate
wealth under management.
Where you sit down, you do anannual review for every single
one of their clients reviewtheir assets, review their
(10:37):
liability, their real estateassets, their mortgages, their
debts, their cashflow and thengive the advisor a one page plan
for each of their properties.
And that's something else thatwe can help you with at our
company.
We provide that to you so youcan do like an annual review.
Provide that to the advisorwhere it becomes a part of their
service that differentiatesthemselves from their
competition and this becomes,you know, their reason for
(11:01):
working with you.
Because you know a financialplanner sees themselves like a,
like a quarterback on a team,and they're the quarterback of
the client relationship.
So they work with estateplanning attorneys, they work
with CPAs, they work withinsurance agent.
It's like a resource that theyhave on their team, right, and
so you become the mortgageplanner on their team and the
way you do that is you got tobuild your service into their
(11:23):
process so it becomes a part oftheir service that they're
providing to the client.
That makes them unique in themarket.
Stephanie Budnik (11:29):
And I think that's kind of twofold from a
consultative approach, we talkabout that a lot as a way that
you can be a trusted advisor,whether that be a loan officer
or a financial advisor, and Ithink that the approach that you
talk about allows thatopportunity to happen naturally,
so that they can get that trustin them and feel that there is
(11:50):
value both ways, because I woulddefinitely see that as
something that you could, basedon what you said, stand out
amongst the crowd and reallygrow that partnership.
Gibran Nicholas (12:00):
Yeah, I mean they're always looking for ways
of creating.
I mean, think about how theyget paid right.
A realtor gets paid based on atransaction, so they're very
transactional in their focus.
A financial planner, on theother hand, gets paid over the
lifetime of that clientrelationship.
So they get paid in one of twoways.
Either they charge fees foradvice, so like, for example, I
(12:20):
have a CPA, I pay my CPA Xamount of thousands of dollars
every year.
He does my books every year andI've had that relationship for
20 years.
So figure, if I pay him three4,000 a year for 20 years,
that's my lifetime value to thatCPA.
Same thing with a financialplanner they get paid over the
lifetime of their clientrelationship where, let's say,
(12:42):
they have a client who has amillion dollars invested with
that financial planner, theadvisor charges an asset
management fee, let's say aquarter percent or a half a
percent or 1%.
So they get paid 50 basispoints on that million dollars
every single year that theclient stays with them.
So they're incentivized to keeptheir clients with them for 20,
30 years and have annualconversations and conversations
(13:05):
every six months to create valueon a continuous basis for that
client.
So if you could insert yourselfinto that process, into their
sales process with their clients.
Then you become the integralpart of that advisor
relationship and you don't need50 relationships, you only need
maybe five or six greatrelationships, because these
clients are going to be veryloyal to the advisors that
(13:29):
they're working with right.
So if you can be part of thatteam, that's really what makes
this a unique partnership.
Stephanie Budnik (13:36):
If you're looking to continue to, you know
, make the most of this referralsource as a loan officer.
What types of different topicsdo you feel that they could be
bringing to?
First of all, maybe educatethemselves on, but also bringing
that knowledge to the financialadvisor so that they're more
(13:56):
well-versed, you know,throughout conversations and as
they add these partnerships andparts of their teams together,
yeah, that's another fantasticquestion, because it's almost
like speaking a foreign language, right?
Gibran Nicholas (14:07):
If you're going to go to Spain on vacation, it
would be useful to know a littlebit of Spanish, to be able to
navigate, get around Barcelona,go to the market or whatever.
So same thing with financialplanners.
If you're going to work with afinancial advisor, it's really
useful to understand theirlanguage.
So they speak the language oftaxes.
Everyone is concerned abouttaxes.
How do we save money on taxes?
(14:28):
So the best way to learn thatlanguage is to learn about
mortgage and real estatetaxation.
So, for example, one of thethings that we do at our company
is we have the certificationcourse and it teaches you all
the things that you would needto know to work with financial
planners.
And one of the topics is taxdeductibility of mortgage
interest.
Another topic is the capitalgains tax.
You is tax deductibility ofmortgage interest.
(14:50):
Another topic is the capitalgains tax.
People are waiting.
Should we wait to sell ourhouse or should we sell now?
If they wait, they're going tohave a much bigger capital gains
tax bill, especially if some ofthese proposals come into place
.
We're going to increase capitalgains taxes.
Understanding capital gains tax.
Understanding deductibility ofmortgage interest there's
special rules.
Understanding deductibility ofmortgage interest, their special
rules.
Understanding the opportunitycost of money If you have a
(15:11):
mortgage at 6%, what's theafter-tax cost, how to calculate
the after-tax cost of that andhow does that compare with the
after-tax rate of return oninvestment.
So the opportunity cost ofmoney.
Understanding retirementaccounts and the different types
of IRAs Roth IRAs andconventional IRAs.
And what if somebody is pullingmoney out of a Roth to buy a
house versus a conventional?
(15:31):
How is that taxed and why mightthat not make sense for the
client?
And understanding blendedinterest rates.
If somebody's got a 3.5%mortgage, why would they go to a
6% or 7% mortgage?
Well, the reason is, if theirblended interest rate is higher
with their current debtstructure, with their credit
cards and their car loans andall these things, if you roll
that into the mortgage, even ata 6%, they're going from a 3% to
(15:54):
a 6% mortgage.
It couldn't make sensefinancially.
So understanding blendedinterest rates.
So these are the types ofconversations you end up having
with financial planners that maybe different than the kind of
conversations you might behaving right now with real
estate agents.
Stephanie Budnik (16:12):
Yeah, I would definitely say that those would
be not as similar of topics tocover from a real estate agent
referral partnership versus thefinancial advisor partnership
there.
Gibran Nicholas (16:19):
Yeah, another one is pulling cash out of a
primary home to buy a vacationhome.
A lot of people want to do thatand it might not make sense.
So it might actually make moresense to put a mortgage on a
vacation home, even if you haveto pay PMI, because of the fact
that if you take the cash out ofyour primary home to pay cash
for the vacation home, themortgage interest is not
(16:39):
deductible anymore, right?
So understanding things likethat is really important when
you talk to a financial planner,and these are the types of
things that we cover in our CMPScertification course.
Stephanie Budnik (16:50):
As we close out the episode, I want to give
you an opportunity.
Just anything else that you canthink of that would really help
loan officers take that firststep and take the initiative to
try something new and really tapinto this market.
Gibran Nicholas (17:04):
Yeah, that's a great question.
I think one of the things that Iwould do really quick, if it's
something you're interested inexploring, is talk to your
clients.
Talk to your favorite clients,call up your top 10 favorite
clients and ask them hey, do youhave a financial planner that
you work with?
Say you know what?
I'm expanding my partnershipshere at my company and I'm
(17:26):
looking to meet some greatfinancial planners to refer my
clients to do you have any greatfinancial planners that you
work with?
And if they say yes, great, seeif you can get a referral to
one of the advisors they workwith.
Or if they say no, ask them hey, listen, would you be
interested in getting referredto a financial planner?
If I find a really great one tobring on board with my team,
(17:47):
would you be interested in areferral to a planner?
So now you win both ways A, youcan get an introduction to a
great financial advisor.
Or, b, if they don't work withone, you have a referral ready
to give to the first greatfinancial planner that you meet
with.
So that would be a super simpleway to get started if you're
interested in this topic.
Stephanie Budnik (18:08):
I really like that approach because it also
allows the loan officer to stayconnected to their past clients,
and I think that sometimesthat's a struggle too to think
of different things, todifferentiate yourself, to still
be thought of after thetransaction, and so that's
another great way to just tapinto the wide network or the
wide resources of networking.
So very, very cool.
(18:29):
Well, Gibran, thank you so muchfor your time today.
I think this was veryinsightful.
I hope that people really takethe opportunity to investigate
this and to look into it and seeif it would work for them.
This brings us to the end ofour episode.
So for a recap of this episodeand quick access to related
content, visitMortgageConconnects.
com and you can subscribe foremail alerts so that you can be
(18:52):
among the first to know aboutnew episodes.
Thank you so much for tuning in.
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