A little over five years ago, I first started generating my own exclusive mortgage leads. 

Back then, I had made the decision to leave a big bank to work for a smaller lender where my compensation plan would increase by 300%. It was an attractive and financially beneficial move, but there was one problem; There was no built-in client base to tap into, so I had to bring in the business myself. 

These were humble and trying beginnings, especially for someone who did not like networking meetings, cold calling, loan officer Facebook ads, or mortgage lead generation companies. I had not yet started leveraging online marketing at all. My social media business skills were dismal at best, but I had to figure it out. I had to do something to get leads to feed my business and my family.  

I was not the only one on this journey of course. Loan officers all over the country were trying to figure out this online lead generation thing. We had a divergent path to mortgage lead generation, though. While they were all on the Facebook ads for mortgage loan officers bandwagon, I was plucking away at this other thing called Google Adwords.

You see, it didn’t make sense to me to go the route of “interruption marketing” when I could clearly see there were a ton of people ALREADY interested in a product I offered, and they were actively searching for it on Google. It just made sense to me that I should put myself in front of those already looking rather than chasing them with ads or looking for the best place to buy mortgage leads.

There were moments of doubt, though. I was spending about $12 to get a lead, and I kept hearing about the Facebook guys getting leads for a fraction of that! On the other hand, I knew that top mortgage generation companies like Zillow and LendingTree were hawking the same leads I was getting for $12, for 3 times less than that. I was torn! On the one hand, I was doing much better than the lead aggregators, but I was also paying many times over what I could be if I went to Facebook for leads.

So I decided to take a crack at Facebook ads for mortgage loan officers, and yes. I did indeed generate those lower-cost leads. BUT there was a problem; the leads were garbage! The conversion rates were super low, and those that converted were usually after a long nurture campaign and lots of follow-ups.

I then concluded that I could be just as effective if I started calling out of the phone book! It just did not make sense to me to keep doing that and I couldn’t bring myself to buy mortgage leads. What if they were the same garbage quality as the ones I’d found using Facebook ads for loan officers?

So I kept at Google, and fast forward 12 months, I found myself having made over $120K in my first year. Not too shabby for a rookie lead-gen guy at the time.  My mix of business was 95% purchase loans, and 70% of those came from my online mortgage lead generation strategies.

That’s right, Big “G” paid off handsomely for me. Not only was I getting my mortgage leads direct from consumer, I was also able to dole out leads and preapproved buyers to real estate agents. I don’t know about you, but when I first started I kept asking myself, how to get mortgage referrals from realtors. So being able to give out leads, that is a unique position to be in. 

Rather than go to them with my hand out asking for a referral, I was in a position to give THEM something of huge value. And guess what happened? Yup, they, in turn, reciprocated and sent ME more business. 

For more strategies on building Realtor partnerships, check out our playbook!

Meanwhile, my counterparts who were working facebook ads for loan officers were now talking about diversifying their lead sources or getting out of the business all together because their leads just weren’t profitable. I, however, was generating a very healthy ROI with my Google campaigns with a very low investment of money. The most I ever spent on ads was about $2K a month. I can’t say that for my colleagues who stayed married to Facebook ads for mortgage loan officers.

Years later, I look at the current environment and see that there are hundreds of LOs now who see the value in generating exclusive low-cost, high-quality mortgage leads. The natural question that comes up quite often is; 

What makes Google Ads so effective? Why is your lead generation system better than the other guys? - well, let me tell you exactly why. 

Intent

As simple and short as that one word is, make no mistake about it; this is THE biggest reason Google leads are hundreds of times better than Facebook, or any other social media platforms’ leads generated from mortgage loan ads

If you think about it, how often do you hear of people saying they went to look for a house or a mortgage on Facebook?

I can probably answer that.. NEVER! 

People are on social media networks to do a bunch of different things, watch funny cat videos, see pics of their grandkids, or check-up on old college buddies, not mortgage loans.  That is not to say that people can’t be swayed to look at an ad for a house, mortgage or whatever else, but that is not the reason they are there. It takes a lot more convincing than if they were online searching for something.. Like they do on Google. 

On social media, you generally have to do one of two things; spend a boatload of money building a brand and content to establish trust and credibility, or have a stupidly ridiculously good offer that they can’t resist but to click on the ad. The latter is hard to do with mortgage loans and houses, wouldn’t you agree? That’s one of the largest differences between Google ads and Facebook ads for loan officers.

One clear indicator of the resistance advertisers on social media run into is getting people to provide any information or fill out lead forms. You’d be lucky to get people to give you a REAL email address and phone number so you can follow up with them. I know, I’ve been there, done that.

Contrast that with Google search ads; when someone is on there looking for “best cash-out loans,” that indicates high intent. Word to the wise here, anyone that searches “best of…” are buyers who already know what they want, they just want to find someone to give it to them. 

So what do you think happens when you slap a contact form in front of them?! They fill it out because they want the stuff!! That’s the reason they were there to begin with! Night and day here people! 

Think about where your head would be if you were searching “Best Books For Mortgage Loan Officers”, you’re looking for hardbound resources to buy to help you with your carrier. If someone offered you a free e-book, that promised a worthy value, you’d enter your contact info for it, wouldn’t you?

So who would you rather call, someone who searched out for what they already know they need or want, or someone you bamboozle to fill out a form with an exaggerated offer so that you can have someone to call? 

Where Do You Think Facebook Gets Their Data?

All advertising networks run on data; without it, an advertising platform is of little use. Facebook is no different, they need data, lots of data on their users. By their own admission, looking at their website, they use their own first-party data AND aggregated data from third-party sources. Especially now that Apple has put an end to collecting unfettered data on their devices. This has limited the data Facebook can collect while on the platform directly and as a result Facebook marketing for loan officers has taken quite the hit. 

Privacy laws have definitely limited the amount of data each app and website can collect. This means that ad platforms must add additional data sources to build a better user profile. You should be able to store all of this in your CRM

 So, where is the best source of user intent data? You know, that pesky little qualifier that makes all the difference, “intent”? You are right! It’s Google! 

According to a recent report from WebFX, the 800 lb “G”orilla of search gets a whopping 91.43% off all searches! Let’s digest that for a moment, Google knows what people are searching for over 90% of the time. Do we think they know who is searching for what? I’d wager good money that they have their finger on the pulse of search and intent.

Where is the opportunity here? You have the opportunity to be front and center in the customer’s face when they reach the “Zero Moment of Truth,” or ZMOT as Google calls it.

Facebook, of course, knows the value of this rich data, so they implement that into their ads platform. But guess who had that info first? Again, Google! So would you rather go where your audience is or rely on 2nd hand information? 

Leads Convert A LOT Better (Or At Least A LOT Faster)

What I am sharing with you is mainly empirical information. It is based on the collective experience of my own business, the experience of dozens of other marketers, and information collected from hundreds of clients and prospects. 

Having said that, I've found that it is actually very difficult to always prove conversion rates from applications to closed deals. Attribution has always been a challenge in digital marketing, no matter how sophisticated the platform is.

So I’m going to share some anecdotal information as well that you can pair up with sound logic, and I think the whole thing will make much more sense. 

Whenever there is a discussion on mortgage lead conversion, the key component, time, seems to be left out. A certain percentage of mortgage leads will convert within a certain time frame, largely dependent on the sales cycle of your service or product.

The quality of the mortgage funnel and offer also have a lot to do with conversion rates of course. Ultimately, understanding the buyer’s journey is key to figuring out your entire mortgage sales funnel strategy and tracking the conversion timeline.

So let’s talk about Facebook and Google as it relates to the buyer’s journey. I think it is safe to say that when you are on Facebook, you are not looking to buy anything. There is no way to know if that user on Facebook is looking for a loan until maybe they click on an ad or engage with it somehow. Contrast that with someone actively searching on Google for refinance rates, and you can get a sense of who might be more “ready to buy”; the person looking. 

So if you get a lead from Facebook ads for loan officers, that lead may or may not be ready to take action. They may be early in the buyer’s journey, just exploring. But what about the lead you get on Google? They are further along in the buyer’s journey, they have identified a need, maybe even what product (mortgage loan) will solve their need, and they are ready to go! They just need to find the WHO to sell them the loan. Much quicker conversion from search than from social.

Let me share some numbers with you to illustrate the point. When we look at lead conversion over a 120-day period, Facebook leads convert at somewhere between .5% to 1%. Add to that the fact that most of these leads on Facebook are for purchase loans which convert at an even lower rate for loan officers. 

Let’s compare those numbers to the conversion rates my clients are seeing. We are finding that Google ads leads convert at 1% to 3% rate within the same window of 120 days. Now 1 to 3 percent may seem like a small number on its own but consider that if you increase your conversion from 1 to 3 that is an increase in commissions of 300%. That should get you thinking a little bit bigger. 

So by using the proven effectiveness of Google ads vs. Facebook ads, you can triple your income without increasing your follow-up or effort. 

Remember asking how to get mortgage referrals from realtors? Well by using Google Ads, you get the opportunity to refer 3 times more clients to lenders, who in turn should reciprocate 2 to 1. We are talking exponential growth possibilities here! 

Is Facebook Lead Gen for Loan Officers Useless?

Not necessarily. There is a time and place for Facebook, no doubt. We’re just not sure Facebook is the place for your loan officer ads. Instead, Facebook is a great place to build brand recognition at a low cost. Becoming highly visible on all channels is a great way to make sure that when they find you on a search on Google, they will already know you and fill out your lead form.

You can use Facebook to build community and widen your social presence, after all, it is a social media platform. But if you are looking for business now, Facebook is probably not the place. Look at Google ads for faster conversions.

If you’re looking to learn more about Google Ads and exclusive lead generation, we’ve got a couple of options for you. 

• Check out the rest of our blog posts for some more information on lead generation and conversion strategies for loan officers.

• Explore a 14-Day Free Trial of our SaaS

• Go to our Youtube channel or TikTok where we have some more great content to help you on your journey. Don’t forget to subscribe!

• Lastly, if you’re just looking to figure out how we can help you leverage a turnkey solution that maximizes all of the strategies that I write about and teach, all you’ve got to do is click here to schedule a call with me.

Thanks for reading, and I’ll see you at the top!

Michael McAllister