In any business, especially in lending, there are moments when you have to decide whether to coach someone up or coach them out. Whether it’s an employee or a referral partner—like a realtor—it’s all about improving the relationship or knowing when to step away.
The Value of Direct Conversations
Over the years, I’ve learned that the most valuable conversations are the direct ones. A coach once told me, “Clear is kind,” and that has stuck with me ever since. When things aren’t going well—like when a realtor sends 16 leads and only one closes—it’s time to have an open, honest discussion.
Starting the Conversation: Lead with Gratitude
Whenever I have these conversations, I always start with gratitude. Even if the results haven’t been great, the realtor is still trying to send business my way. Here’s how I usually begin:
“Hey, Sally, I just want to take a moment to thank you. I probably don’t say this enough, but I really appreciate you trusting me with your clients. It means a lot that you’re sending business our way.”
Once I’ve set the tone with appreciation, I get into the numbers:
“I’ve been looking at the recent leads, and out of the last 16, we’ve only closed one. I feel like that’s on me, and I want to make sure we’re doing everything possible to support you and your clients. Does that sound right to you?”
Using the Account Pyramid
To have this conversation, it’s critical to keep track of your leads. That’s where the account pyramid comes in. The account pyramid is a tool that helps you track where your leads are coming from, how many at-bats you’re getting, and how many closings you’re converting. It gives you the data you need to make smart decisions and have informed conversations with your partners. By regularly updating the account pyramid, I was able to identify the issue in this case: we had 16 at-bats, but only one closing. That’s not sustainable.
Not Every Realtor is Your Duck
Another concept to keep in mind is the idea of “ducks.” Not every realtor is your duck, meaning not every realtor is going to be the right fit for your business. For instance, if a realtor focuses heavily on new construction and you’re not competitive in that space, it might not be a match. Or, if they’re consistently giving you challenging deals while other lenders get the easy ones, you have to evaluate whether that relationship is worth the effort.
You can coach them up by helping them understand how to better funnel leads to you, but sometimes it’s just not the right fit. If that’s the case, it’s okay to walk away from a realtor who isn’t your duck.
Understanding the Problem: Is It Rates or Something Else?
In some cases, the issue comes down to rates. If the realtor is sending my name along with two or three other lenders and the clients keep going elsewhere because of better rates, that’s an important thing to address.
I’ll say something like:
“Hey, if rate is the big deciding factor for your clients, I totally understand. But if that’s the case, I don’t want to waste your time or mine. Maybe it’s better to just send those clients to the other lender if they’re consistently winning on rate. I appreciate that you’re trying to send business my way, but if I’m not competitive, it doesn’t make sense for anyone.”
When You’re the Backup Lender
Sometimes, a realtor has a long-term relationship with another lender, and I’m just the backup option. That’s fine, but I make sure to have the conversation:
“Sally, I respect loyalty. If you’ve been working with someone for 20 years, I get it. But I’ve got to be honest—I don’t want to be your backup lender. We’ve worked together long enough for you to know how my team operates. I’d love to be your number one, but if that’s not on the table right now, I understand.”
Setting clear expectations not only shows that I’m serious about being their go-to lender, but it also sets the stage for future opportunities if things change.
Knowing When to Walk Away
After these conversations, it’s possible that nothing changes immediately. In one case, after talking to Sally, I didn’t hear from her for a few months. I told her we were done unless something changed. A few months later, she came back with a deal that other lenders couldn’t get done, and from that point on, I became her go-to lender.
Be Direct, Honest, and Willing to Walk
At the end of the day, the key is to be direct and honest. If the conversion rates aren’t there, it’s time to dig into why. Sometimes it’s the rate, sometimes it’s the type of business they’re sending, and sometimes it’s just not the right fit. But you have to ask the tough questions to figure it out.
If the leads are all dead ends, you need to find out why. Maybe they’re sending you the hard loans while giving the easier ones to another lender. If that’s the case, you either coach them up on how to send better leads, or you coach them out if it’s not worth the time.
In the end, it’s about making sure both you and the realtor are benefiting from the relationship. And if it’s not working, it’s okay to walk away.