Rick Geary, Emery Financial, Newport Beach, CA
2002 Origination Volume: $120 million
2002 Average loan amount: $285,000
Software: Emery software (designed by the company), Calyx Point
Referral Source Mix: Of total referrals, CPA's & CFP's make up 40%; past clients and Realtors make up 60%. Overall referral business is about 75%; Targeted marketing yields the remaining 25%.

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Boni Lonnsburry: How did you get started in the mortgage business?

Rick Geary: I did hard money loans part time for a friend's father in 1986. I transitioned to "A" paper loans when I joined Emery in 1993.

Boni Lonnsburry: Were you an immediate success?

Rick Geary: I actually began as an assistant to the founder of Emery, Brad Sarvak, in 1993. He was the brother of a high school friend. He knew that I had worked around mortgages and understood numbers. I assisted him for six months in order to learn the ins and outs of the "A" paper loan business.

Then, in early 1994, rates shot up about 2% in a few months. I came from a background of running small to medium size businesses so, during the down sizing, I ended up working in Emery's operations. I spent the next year and a half building the business through direct marketing and productivity improvements.

Working in operations was advantageous because I got to see every loan application move from opening through closing, including escrow and the accounting functions. It helped to develop my knowledge of the entire process. That still gives me an advantage because I'm able to trouble shoot, anticipate problems, and make the entire mortgage process smoother for my clients.

Boni Lonnsburry: When did you cross over into originating full time?

Rick Geary: I crossed back into originating in early 1996, which was a tough year because the interest rates, compared to 1993, were still quite high.

Boni: What is the biggest mistake you think rookie loan officers make?

Rick: They jump in too fast and start calling people immediately. They've got all that energy and hope, but they really don't understand the products or how to make the process easier for the client. They should first be researching what they're selling, and know what they can deliver. Establishing trust is critical to future success.

Over the past couple years, rookie loan officers have had it easy because of the historically low rates. It is going to be interesting to see how many of them really stick with the business over the next year when rates rise as expected.

Boni: You've seen a few market fluctuations throughout your career. What advice would you give them for dealing with a changing market?

Rick: If they aren't entering the business with a strong referral base, through past affiliations or a strong networking system, the best thing they can do would be to apprentice under someone who is a larger producer. It's an excellent way to gain experience very quickly and to see first hand how to take care of clients and deliver the products they need.

Boni: Would you recommend becoming involved in associations in order to network effectively?

Rick: I would recommend it on a limited basis. You can't be all things to all people, but if there are some areas in which you have a strong, valid interest, it certainly couldn't hurt to join an association or two.

Boni: Do you think veteran loan officers make different mistakes than the rookies?

Rick: Sometimes veterans fail to maintain their energy and keep their approach fresh. After thousands of calls, it all starts to sound similar - you have to find a way to keep yourself fresh and recharged.

I do this by scheduling myself to take two weeks off each year to get away from the office, usually a period of seven to ten days, and another long weekend. My support staff, of assistants and processors, is strong enough that I can allow myself that luxury.

For me, I need to be disconnected from the office for that time, maybe try a fresh way of thinking. It's best to explore new ways of thinking when you're away from any interruptions. I'll spend a day or two rethinking where I want to be in the next year, who I want to work with, and how I am going to accomplish my goals.

Sometimes it's even a question of narrowing down my client base. Again, I know that I can't be all things to all people. The fact is there are some people you just don't connect with - any interaction with them is always a battle. There are plenty of other mortgage professionals with whom they can work. Fortunately, over the past ten years, I've built up enough of a client base that I can afford to part with a few people if it's not a mutually beneficial relationship.

Boni: If you find you just can't work with a particular client, how do you let them know?

Rick: I've found that the best way is to politely tell them, "Thank you for doing business with us in the past. Here is a gift certificate (or something similar) to show our appreciation." It is important to us that it's a polite parting. We try to treat everybody with dignity and respect, even if we can't continue to service their needs in the way they'd like to be handled. We have even offered to refer them to someone else. We do a lot of loans, and a lot of volume, and it becomes unfair to the clients who aren't being squeaky wheels not to give them equal time. This lets everyone win.

Boni: If you had a son or daughter entering the business, what advice would you give them?

Rick: First, I'd advise them to hone their service and people skills. It might be wise to start out working in food service, an airline, retail, or in the travel industry, where courtesy, politeness, appearance and professionalism are expected at all times.

Second, study the products they are about to sell. The most knowledgeable loan officers seem to be the most successful ones, perhaps because they have credibility. Also, I'd advise them to study the mechanics and economics of the market. I'm a big believer in knowledge and research. If they are dedicated to making the mortgage industry a life-long career, they should be willing to put in time and hard work to truly serve their clients.

Boni: How do you make CPAs and financial planners such a huge source of referrals?

Rick: A friend of mine from college is a financial planner. We built our businesses together. It's been a very beneficial relationship, wholly based on trust. We don't send each other thank you gifts or pay each other kickbacks for the referrals. We refer to each other because we know that our respective clients will be taken care of. We are accountable to each other.

My own CPA is also a source of referrals for me. We both appreciate how the other works, the knowledge each has, and the research we've done. Of the 40% of my referrals that come from CPAs and financial planners, 80% come from these two sources. I'm very fortunate to have them with me.

Boni: What was your most successful marketing campaign?

Rick: We did some very focused target marketing in 1994 when the rates started turning higher. Instead of using the free leads from title company services (which we had found often were outdated or stagnant data), we purchased clean, updated data targeting specific persons in the marketplace - i.e., clients with variable rate mortgages who had missed the opportunity to move to a fixed rate in the dip of 1993.

We marketed to these folks with adjustable rate loans, knowing that in a matter of months they were going to adjust. Our first mailing was only a 10,000 piece mailer. We received 350 phone calls, which is a 3.5% response (this is well above the 1% - 2% norm). By being specific about our market segment, we avoided wasting our time. It cost us $200-250 per closed lead, with an average profit of $2000. We've repeated this campaign off and on over the years as the market has changed, making adjustments in our data requests to fit the market conditions.

Boni: How do you encourage your past clients to refer you?

Rick: We send out at least six newsletters a year and every one mentions a request for referrals. At closing, we send out a thank you letter that requests they refer us people if they were satisfied with our service.

Through the software our company built, we are able to track each client's referrals, and who those referrals referred, and how profitable those referrals are. We use it to track and stay in touch with clients who are still on adjustable rates, fixed rates with 2nd mortgages, or who told us they may move or retire in two years, and so on.

Boni: Who or what was the biggest contributor to your success?

Rick: The "who" part would be Brad Sarvak, the founder of Emery. He is a visionary and a very sharp individual. His energy is unmatched in this business, and he's a great motivator. Five of us here made the Top 200 Mortgage Originator list in 2002. We have nine producers who are doing over 100 million per year.

The "what" part is the software that Brad and I developed. We are currently working to make it available to other originators nationwide.

Boni: What are some of your current goals?

Rick: Over the last three years of the refinance craze, we managed never to miss a purchase closing date on our end. For 2003, even with the forecast at the beginning of this year for a small slow down, we wanted to maintain at least 2002's closing numbers. We passed those numbers in September. I've been averaging 40 to 45 closings per month for the last 18 months. In 2004, with refinances predicted to slow by 60-70%, my goal is to not slow down to less than 25 closings. I've got a great associate, Brian, a processor, Debi, who knows how to do high volume, and an administrative assistant (part time) to take care of a lot of the follow up and trouble shooting.

I also stay in contact with our Realtors and let them know we're still here to serve them. I stay in contact, by phone and email, with the four Realtors who are my largest source of transaction referrals. I use Greg Frosts' email system, "The Daily Communicator," to update my Realtors with ideas and articles to help them and their clients. Recently, I've implemented Barry Habib's "Mortgage Market Weekly" newsletter, as well. These help keep my name in front of the Realtors I work with on every transaction.

Boni: Is there anything else you'd like to say to other loan officers who aspire to the kind of success that you've created?

Rick: You've got to be patient if you're just starting out - don't get discouraged. Make sure you stay current on your knowledge. It's a very rewarding career if you're willing to put in the time.

It took me nearly six years to really get going in "A" paper because of where we were in the interest rate cycle when I began. In 1998's refi wave, I tried to close as many loans as possible without worrying about the profit on each deal. I was focusing on growing my client base. When I saw the rates begin to fall then, I knew I had an opportunity to gain word of mouth referrals, even if it meant earning less per loan. That plan paid off in 2002-2003.

Never lose track of your core business. It's really made up of the individual clients who have family members and friends to refer to you - if they are satisfied and trust you.