Inspiring loyalty with service

Real Estate Weekly, Oct 9, 2002

When David Peskin first started working in the loan industry he was fresh off the campus of Ohio State University in Columbus. But far from being intimidated about heading off into the working world with his bachelor's degree in business, Peskin saw it as an opportunity to continue his education.

He knew there was a lot to learn when he showed up for work on his first day at Michigan-based Rock Financial, which was then one of the largest lenders in the country (it has since been taken over by Intuit). While working at Rock Financial, Peskin learned the basics and began to form his own core business philosophy. When he moved back to Long Island to start Mortgage Warehouse in 1995, the lessons he learned at Rock Financial served him well enough that his business has grown to be one of the largest on Long Island. It now includes two separate units in addition to the original mortgage lending division.

What he brought with him when he returned to his native Long Is-land was a vision of what would capture the attention and loyalty of homebuyers across the region in search of loans. He came to realize that offering superior customer service would generate business through referrals.

The philosophy Peskin developed in the early part of his career was simple and to the point: have a good marketing campaign to entice customers and then provide top-notch service to inspire loyalty.

Although Peskin says the mortgage business was not much different in the Long Island/New York City area than in the Midwest, there were higher costs associated with advertising that had to be dealt with.

"Name recognition was a big obstacle," Peskin said. "Advertising is more expensive in the New York metro region, and that made it more difficult to get into the refinance industry."

Still, Peskin said, "I learned at Rock (Financial) that marketing is important because it helps get your foot in the door." After that comes the second part of his successful philosophy.

Plenty of businesses promise excellent customer service, but making good on that promise is not easy. According to Mortgage Warehouse employees, an intensive training program for all sales staff ensures that each customer receives service tailored to his or her needs.

Peskin believes that the two-week training program has paid off. "Not only have our sales force's return rates increased, so have our customer service ratings. A huge source of our business is from satisfied friends and family. It is clear that a well-trained salesperson helps make a complex transaction flow smoothly," he said.

Central to the training program is teaching sales people to ask the right questions when talking to customers. "When I talk to people I will ask direct questions. You need to find out what their situation is; how long they're planning to stay in their house and what they're looking to accomplish. That allows me to find the right product for that consumer," Peskin said.

Once Mortgage Warehouse was up and running, Peskin's entrepreneurial side kicked in. Peskin saw an opportunity to be a pioneer -- he developed a network of financial professionals who can sell mortgage products. "I thought about how these financial professionals already had the clients and those clients trusted them. So, who would be better able to sell mortgage products than a financial professional?"

Changes in federal law allowed Peskin to start Vertical Lend in late 1998. (Vertical Lend legally enables financial service provider to earn compensation for originating mortgages and loans.) Currently, the Vertical Lend program has 1,400 associates onboard and projects that more than 2,300 financial professionals will be signed up by the end of next year.

Still not satisfied, Peskin developed a new business model that will allow him to distribute mortgage products through another distribution channel -- real estate agents. Boulder Financial group was created to help agents who are looking to diversify their business and increase annual revenue. Peskin says the agents -- who often send their clients to mortgage brokers -- are in a good position to provide the service. As with the Vertical Lend and Mortgage Warehouse programs, real-estate agents who enroll with Boulder undergo rigorous training.

Choosing the road less traveled has clearly contributed to Peskin's success. Employing the basic fundamentals of sales and marketing to unorthodox distribution channels has made of David Peskin a leader in the mortgage business.