Mortgage lead generation is a topic of constant concern and never-ending expense for mortgage loan originators and the lending institutions they work for. There’s just no way around it. You’ve got to have a steady flow of people to talk to if you plan on closing any loans or making any money.

So what do you do?

Well, if you’re like over 95% of the loan officers out there you’re doing one of 3 things.

1. You are buying internet leads

2. You are using Pay Per Click Advertising

3. You are placing ads in newspapers and magazines

Sound about right?

Yeah…I thought so. But let’s examine the downside of those three choices.

If you’re buying internet leads, and God knows I’ve bought thousands upon thousands of those little critters, then you’re spending anywhere from $15 – $75 for those leads. The $15 variety will get you a lead that is God knows how old, and probably already sold to 20 other brokers. Out of 10, you might talk to 2. Money burned!

The $75 variety will get you a ‘hot-transfer’ lead. Much better quality, but you better be closing these guys at a pretty hefty clip or you’ll go in the hole fast at those prices.

Usually the sweet spot is somewhere in the middle, where you’ll spend $40-$50 for an "exclusive" lead (maybe exclusive to one company, but who knows how many lead forms that prospect has filled out), and on average you’ll actually get to speak to about 3 in 10. Some days better…some worse.

Or maybe you’re using Pay Per Click. I know, I know….just the thought of it makes your wallet break out in a cold sweat. Let me put it this way, you had better spend about a year learning how to become a professional pay per click advertising master if you want to play this game. Last time I checked, the average price for a ‘click’ in the highly competitive mortgage leads niche was $11.47. NO that’s not the cost of a lead…that’s the cost of a click!

After they click, they go to your website, and you had better have a killer page that converts that click into a lead once they get there, or you’ll be in business for about 10 more minutes. Considering a good conversion ratio is around 15% , if you sent 100 clicks to your page at the cost of $1,147, you would get 15 leads. Let’s pray they are good leads and you can turn at least one of them into a closed loan. A risky game, fit only for the brave, the PPC educated, and those with a really healthy advertising budget.

Or maybe the online thing is not your bag at all. Maybe you’re old school and prefer magazine and newspaper ads. That’s cool…but the competition is fierce. Response rates are diminishing and the costs are going higher and higher. If you find a sweet spot, milk it for all it’s worth, because the competition will soon be on your heels!

I know, I know, just thinking about all this is making you depressed.

Well, let me tell you a quick little story…

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