Service? What stinkin’ service?

In sales, there’s the familiar phrase, “if you want to stay in business, you have to underpromise and overdeliver.”  Every time this is trotted out at a sales conference, all the bobbleheads nod as if this were profound and critically important.

I think it’s stupid.

There are lots of reasons for this, but I’ll start with just one, and that is that if you underpromise, you’ll never get a chance to overdeliver, because the other fellow – the one that is promising the moon – will get the business and you won’t.  I even remember hearing one very brave and almost certainly now unemployed speaker mention that very thing.

I echo, and amplify, this sentiment.

And I brought witnesses.

Three times just this year – and remember, it’s only March – I have had clients that I spent hours and hours educating about mortgages.  I do this a lot, and I do it very well, and I do it for free.  I have several avenues for this education, from this blog to RateWatch to private consultations.  I do a lot more than just quote somone a rate; I help them understand what loan is best for their situation, figure out how to budget appropriately so as to pay the loan off in the shortest possible time, even discuss (for those who are really interested) the inner workings of the mortgage market, where things are likely headed, and what economic indicators to watch to figure out when is the best time to move.  I even perform that market watching FOR them, so that they get the rate they want when it becomes available, even if they’re on a cruise (true story – it’s happened).

I’m not bragging when I say that this is a level of service that is unavailable to the general public.  The average loan officer cannot and will not do the things I do for my clients.

All three of these guys, after several hours apiece of this service, locked loans with other mortgage companies and ended up doing their deals somewhere else.


One of them was shopping the rate between me and another guy, and when I refused to cut my fees, he went with them.  He then referred his brother, who got RateWatch on the day he wanted to lock and assumed that meant he couldn’t get the rate he wanted, so he called up someone else out of the blue and locked with them.  He never called me.  The third fellow clocked my rates for three weeks, heard something on the radio, called them, locked, and called me later to tell me he was sorry, but.

In all three cases, the fact is that I could probably have matched the rate and fees of the competing company (had I known about them).  In one case, I wouldn’t do it.  In the other two, I might have, if I had been given a chance.  But in all three cases, I provided hundreds, even thousands of dollars of value and ended up with nothing.

There are two pieces to this puzzle.  One is the spiritual piece, and that part is in favor of doing what I did.  Cast your bread upon the waters, that sort of thing.  I believe this and I live accordingly, at least most of the time.  I do believe in a God that keeps score.  My life is an example of how a good heart and virtually no sense can work pretty well over the long term.

The second piece is the business piece, and that piece says I’m a fool.  If you provide people free help, they’ll screw you.  There are a thousand examples of this.  The most obvious one to me is the bookstore example, where people go into a bookstore, find a book they like, read a piece of it, then go to Amazon when they get home and get it for half price.  I used to do this, too, and I understand the behavior.

But I don’t do it anymore, at least, I don’t do it except to Borders and Barnes and Noble, or other big chains.  When I shop at my local bookstore, I always buy there when I find the book I want.  I know the $15 book there is available at Amazon for $7 (or even less, used).  I don’t care.  I want that little bookstore to be there when I want to go read a book sitting in a chair in the sun.  If I don’t patronize them, they’ll die.  I want the bookstore, so I give them my money.

The business piece of the puzzle says that this is lovely sentiment, but what I’m doing not only doesn’t maximize my financial power, it also encourages inefficiency in the market.  If I provide these free services myself, I’ll get taken advantage of and eventually I’ll get ripped off so hard I’ll go out of business.  This is a rather persuasive argument, right at the moment.

So I’m in a quandary.  Last Thursday, a client of mine that has been working with me on his loan for about two months, getting all this free consulting, and who is also a friend of fifteen years, called me and said he’d been hearing on the news that rates were really low, so he called his credit union and their rate was .25% below mine.  Did I want to match (“you know, I’d really rather do the business with you, but..”), or should we just call it a day?  Now, this guy LOCKED his rate with me about three weeks ago, which protected him through all the market turmoil from having his rate jump.  He got this protection, again, for free.  Now he wants a lower rate, and if he doesn’t get it, he’s gone.  I have certain contraints on what I can do once I lock a rate.  I have secondary lenders that will charge me if I break locks, or even cut off funding for my loans if I break enough of them.  I called them and renegotiated the lock (costing me $450), but could only get within .125% of the deal he was being offered.  On his loan, that’s a monthly difference of less than $15.

Will it be enough?  I don’t know.  He was going to take a weekend and think it over.  He absolutely has to do the right thing for his family.  No question about it.  His argument is that the lower rate will save him $4-5000 over the life of the loan.  This is true, if he holds the loan for 30 years.  My counter-argument is that this is not the same thing, as COSTING him $5000 to do the loan with me.  Not only is he not going to hold the loan for 30 years, he is also going to get a substantially better package of services, more information, etc., and down the road there absolutely will be an opportunity he will be able to take advantage of if I am advising him.  I concede his argument, and he concedes mine.

So here’s my question: suppose he decides he’s going to do the loan with the credit union.  What do I do?  Do I provide my services anyway, on the spiritual principle that doing good is its own reward?  Or do I cut him off and refuse to be blatantly taken advantage of?

I really don’t know what to do.  I want to make a living.  I also have to not only be true to myself, but recognize that the more service I provide, the better chance there is of earning the business (and referrals) in the future.  So even if I know a guy just ripped me off, isn’t it good business to continue to provide my best service?

Maybe it won’t come to that.  But I’m still going to want to know the answers to my questions.

7 Responses to “Service? What stinkin’ service?”

  • I could answer but I know you and I know what you’ll do anyway. And you do it better, and far more constantly, than anyone I know. (The fact that those two adjectives are together is probably not an accident.)

    The older I get the more I buy the book at the local store, the more I don’t watch the clock to make sure I clock out just late enough to have my time rounded up rather than down, the more I figure that a)what am I here for if not to spread it around? and b)it’ll all work out in the end (because there’s someone watching who will see to it that it does)

    So have fun on all your free consultations (even probably one for that guy in a year or so) and let’s face it, we don’t call it Karma but…

  • Ron says:

    Wow Chris -
    I was one who did not lock with you. Feels weird to be the bad guy in print. :)

    BTW- I don’t think you got the whole story on either of us (my brother and I), but ce la vie.
    I appreciated the advice and time you spent with me, but the broker I locked with ALSO spent similar time and effort with me. You always told me that your service and advice “may be unsolicited”, so I took it at that and continued to do my due diligence looking at competing offers.

    In my case, I DID tell you that I had another broker that I was also doing business with, so the phrase “In all three cases, the fact is that I could probably have matched the rate and fees of the competing company (had I known about them)” must not have applied to me.

    With regards to my brother, he locked because he had a window with which he could get a rate .125%-.25% better that what you quoted. He called you during the day (as I advised him to) to see if you could match, but when he did not get a call back until much later that night, he locked before the rate was no longer there.

    The fact that I got lower fees and a lower rate did nothing to change the fact that I referred my brother (and others) to you and gave you the chance to get his business. Losing clients is rough at any time and in any industry, but for me it came down to .25% and a significant fee difference.

    I take no offense to being the bad example. In fact, with no hard feelings, I will continue to send people your way to give you a chance to get their business because you are good at what you do.

    You have great service, but don’t take it personally when someone goes with a better offer with similar service.


  • I too, am in a business or industry (credit repair)that requires giving great information before people believe they can trust me. Also, my product costs more than the scammers out there who have incredible marketing budgets. But, I have a better product by far because we are professionals that know our business and provide even better assurances, still I have people who go to the competition or try to do it themselves even though we show them that it can’t be done. I think they are desparate to get some value for a cheap price. Sometimes it just doesn’t work that way. You have to pay the price to get the value. Almost sounds like putting in a garden. If you put in the effort, the time, the money for good soil, seeds, water, etc, then you reap the excellent rewards of a plentiful garden. Without it, depending upon others, skimping, putting in lesser quality ends up with stuff that looks like vegetables but tastes…. aweful.
    I have found business professions that have a higher standard… a higher purpose and it is refreshing to do business with them. I will refer many clients to a business that puts clients needs over money… every time.
    You go Chris… we are on your side!

  • chrisjones says:


    You have guts. And you have nothing to apologize for, as you correctly state.

    I did not get the whole story, and I am glad to get it. You’re not necessarily the bad guy, and I sincerely did not mean for my post to make you out to be one. You were a catalyst for something I have been thinking about for a long time – you weren’t and aren’t the only, or even the primary reason for my post, and I want to make clear to everyone that you aren’t to be made out to be a villain. If that’s what came across, I apologize, and I’m sorry.

    I’m skeptical that the other fellow was willing to take the hours – and I mean HOURS – on the phone to discuss Fed policy and its potential effect on interest rates going forward. But I can’t argue with you, because I don’t know, and you’re not the sort to make stuff up. I am glad that others are willing to do that. It surprises me, and maybe I have to re-assess.

    The fact is that I COULD have matched his offer, but 1. I didn’t know you actually had such an offer and 2. I didn’t want to. I priced your loan where it was profitable for me to do it. So I WAS referring to you when I said that I could likely have matched the offer you got. I could have, and if I had been explicitly challenged to do so, I don’t honestly know what I would have done. Probably abandoned my principles and taken what money I could get.

    With regard to your brother, what he told me was that he got my RateWatch in the morning, where I gave general rate guidance about what I saw in the market, assumed that meant that his rate was going to be what the general rate was, and called someone else and locked with them. He did NOT call me, that I recollect. I called HIM. I had spoken to him two days before, emailed him that morning, and then called him that night. By the time I knew there was a specific offer on the table, it was already over. I could not only have matched his offer, I could have (and would have) BEATEN it. But I did not get the chance to do it, either by phone or email.

    After I found out that he had locked with someone else, I emailed him asking for some guidance as to what I could have done better. He was receiving my RateWatch – another thing nobody else does, that I ever heard of – he was being called regularly, what else could I have done to earn the business? I never got a response to that question. Bending over backward to be fair here, it is likely that the tone of my inquiry was not the very most gentle, but I did sincerely want to know what happened, and how I could improve so that it didn’t happen to me again. I still don’t know, and it DID happen again, about a month later. That experience, more than any of the others I mentioned in my post, made me wonder just what the heck I was doing, and if perhaps I ought to stop.

    I do not and never have claimed to be the lowest price in town. I do not and never have claimed to have the lowest rate on every loan all the time. I do claim, now and always, that my clients will save more money and get better service and have opportunities that others do not. I have programs and give out information that other loan officers do not, and my clients will end up better off – yes, even if on a specific transaction they believe they could have gotten $12/mo better deal – than if they do business with other people.

    I like you very much and enjoyed our conversations tremendously. I appreciated the referral, despite the way that ended up, and would appreciate and do the same work for any others you send my way.

    But I’m in a quandary about other services I provide. Should I continue to provide them to you? I spent money and time on you, which I have not been – and see no prospect of being – paid for. You are a referral source, and I value that tremendously, but what happens if your referrals do the same thing you did (and you have to admit, we’re one-for-one there)? All that does is eat up my time and my money, frustrate my staff and steal resources that could be better spent on people that WILL appreciate the services I provide enough to actually do business with me. I don’t ask this snidely. This isn’t a rhetorical question for me; it’s a matter of business life and death.

    If you were me, what would YOU do? Assume that you were in my position, and you had the same experience with me that I had with you. Would you keep sending RateWatch? Your monthly newsletter? Other information? Would you enroll them in the Mortgage Under Management program? Would you send them birthday cards? Invite them to the Client Barbecue this summer? The Twelfth Night Charity Ball? At what point would you restrict your services and the benefits that come with being a client of the Group? Would you provide those to everyone that wants them? Only those that are serious? Only those that have done business with you? How would you assess their seriousness?

    I’d love to know. I could use the advice. Right now, I’m really wondering.

  • Ron says:


    I appreciate the response, which I really did not expect.

    I don’t expect you to provide free services to me, as I don’t believe in a free lunch, unless it is advertised as such with no strings attached (as it was and the reason I even came to your BBQ). ;)

    In fact, if it makes things more equitable, you can take me off ratewatch and tell me to not read your blog or newspaper articles, and I will oblige as I do not feel entitled to such, but have continued to read thinking it was intended as a free service with no strings attached.

    As for spending time and money on referrals or clients, it is the nature of ALL business that you “gain some and lose some”, as you know. In fact, in the business I work for, we have spent significant resources (hundreds of thousands of dollars) trying to woo a client (a national name brand computer manufacturer) that we may NEVER get.

    In turn, I cannot guarantee that people I send your way will buy your product, and although I will concede on the “one for one” comment, how could I ever know if someone will ultimately be profitable to you?

    If you feel that those I may send your way are a specific type of person that will suck your resources and waste your staff’s time, tell me and I will send elsewhere. That’s your call.

    I think all any referral will do is what I have done and get competing offers, assess the situation, and make the best decision for them based on how competitive the offers are. All I can promise is that you will be given a chance to get someone’s business.

    Truth be told Chris, you do not have the monopoly on great service and analysis of the market, mortgage rates, etc. The broker I ultimately went with was VERY good at relaying the information and had continued great service post transaction. For that reason (equitable services provided), it came down to rates and fees.

    I cannot speak for my brother, only relay information from his side, so you will have to work out any mis-communications directly with him.

    I cannot give you advice on the extras you provide like the BBQ, ratewatch, etc as I do not know the return you are getting from them. If losing clients to others based solely on the numbers despite these extras is painful, I would suggest reassessing the value to you to host them and benefits you may be seeing.

    The financial world is changing and innovative ideas will keep people afloat – as you are doing. I understand your pain, as the market and world is painful for everyone out there, especially brokers. I do, however, wonder how this specific blog post will help in the future as people may not want to be the “one that got away” or one who abuses your staff’s resources which I do not think I did.

    Just my two cents.


  • chrisjones says:


    This is exactly the dialogue I was expecting to have with someone, and I’m glad it’s you.

    You were absolutely correct that the Barbecue was free, and obviously there aren’t any strings. The blog, the newsletter, everything else is also free, and there are not strings attached, really. I’m not having this discussion to make you or anyone else feel bad – I’m trying to figure out if the things I provide SHOULD be free, or if I should restrict them. Although you haven’t provided any definitive answers to that question, your feedback is extremely valuable. I’ve been able to reassess what I’m doing and see that there probably is a need for some services that are not free, and that I do not provide to everyone that asks for them. At the same time, there remains a need to use my expertise to provide some services and bennies to people just because that’s how good people – and smart people, as you point out – do business.

    And without this dialogue, I don’t think I’d have realized that, or at least, not as quickly.

    As I said before, you didn’t do anything wrong. You didn’t misinterpret anything. This really isn’t about you, so much as it is about us, and what we can do to be better at what we do, remain profitable, and improve our effectiveness.

    You didn’t abuse us. Especially since you are willing to help me think through these things, our experience with you has to be rated as a positive one. You’re not only welcome to continue to consume all the services that are offered to you, I’d be interested in offering you something else as well, which I’ll do in another forum. You think about things, you have some valuable perspective, and I’ve really enjoyed this exchange. Hope you have, too, and that you’ll comment on other posts that might not be quite so specifically about you.


  • Ron says:

    Chris – I appreciate the dialogue as well. In no way did I mean to detract from your message or belittle the messenger, but tried to offer my perspective and insight from the “other side”.

    Thank you as well. I hope to continue our association into the future.


    PS – Go cougs.

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