By Jeffery A. Long, CPA
Vice President, Lending, Apple Federal Credit Union
 
The spring season is prime time for home sales.  The Federal Reserve’s long-awaited interest rate hike has left some mortgage holders and those thinking about seeking a mortgage unsure how to react.  Don’t be deterred.  Understanding what this rate increase means will help you make better buying decisions so you can take full advantage of the robust spring market. 
 
First it’s important to know that Federal Reserve fund rates are not directly linked to 30-year fixed- mortgage rates, so they don’t uniformly go up and down when the Fed makes changes. In fact, many other economic factors affect mortgage rates, including demand for housing, inflation, and employment levels. 
 
Interest Rates for Mortgages are Still at Historic Lows
With the economy chugging along and unemployment back to pre-recession levels, mortgage rates (even with an interest rate hike) remain at historically low levels, making this a good time to buy a home.  In recent months, Freddie Mac’s average for a 30-year fixed-rate mortgage has drifted between 3.5 percent and 4.75 percent, holding right now below 4 percent.
 
Housing Trends Continue to be Strong
Other good news is that home values are increasing and making their way back to “normal.” Buyers can once again see housing as an investment and sellers can feel good about a more fairly valued home price, while current owners enjoy returning equity in their investment.  The key is that rising home values are consistent and sustainable, which creates a strong market.  Indicative of this, in the fourth quarter of 2015, the median sales price for a house in Washington, DC, was $510,000, up 5 percent from last year during the same quarter.  Other locales followed suit with the median sales price for a house in Silver Spring, MD, at $372,950, up 6 percent from last year, and in Fairfax, Va., the median home sales price was $475,000, up 3 percent.
 
Choosing a Mortgage Product
So what’s the right mortgage product given the interest rate hikes? It depends on what your long term goals are, but here are a few things to keep in mind.
 
1.Adjustable Rate Mortgages and Lines of Credit Impacted by Rate Changes
Unlike 30 year-fixed rate mortgage rates, adjustable rate mortgages and home equity lines of credit are tied to shorter-term rate indexes; and therefore will be more directly affected by the Federal Reserve rate hike. If your time horizon for living in the home is longer than 10 years, that may make 30 year fixed mortgages more appealing for you right now.
 
2.Consider Refinancing ARMs
If you are planning to stay in your home for a short time, an ARM may be a good bet for you.  If you have an ARM that currently readjusts annually or will readjust soon, you should consider refinancing to a fixed-rate mortgage now as this could save you a significant amount of money in the future.  Conversely, if your adjustable-rate mortgage rate is locked in place for a few years, it’s probably best to wait and see what the future holds.
 
3.Fixed Rates for Home Equity Lines May Cost More
If you are looking to use your home’s equity to make improvements before selling it, you should be aware that Home Equity Lines of Credit are likely to rise with the Fed funds, averaging about 5.5 percent. You pay a premium to be able to lock into a fixed rate so they are higher than what you would pay for a variable rate.  Conversely, a variable rate Home Equity Line will be cheaper now but could expose your loan to higher interest payments if rates were to rise. Before locking into a fixed or variable rate, take the size of your loan and the amount of time you plan to pay it off into consideration. 
 
Don’t be put off by the headlines.  Record low mortgage rates, a strengthening local economy, and increasing housing prices mean that spring is shaping up to be another robust shopping season for homebuyers and sellers.  As always, be a smart shopper.  Ask your lender lots of questions to fully understand the variety of mortgage products available to ensure that you are getting the best solution.

By Fred Diamond, Diamond Strategic Marketing

​
​Something very exciting happened to me during the last two weeks in December that I will share with you. I heard from three business associates who had gained new clients directly from referrals I made on their behalf. This was great news to me for a number of reasons I will share later in this blog. I’ll also reveal three lessons I learned about how you can drive more referrals to your trusted associates.
When I heard from the first two of my business associates, I was pleased. It felt nice to help out friends I respect.

But when the third one called, I thought, okay, something interesting is happening here. I did some investigating and learned why the referrals were so successful. I always thought I was a good referral agent but now I could finally see some tangible results.
All three of the business associates are members, past speakers or sponsors of the Institute for Excellence in Sales (IES).

A KEY POINT ABOUT MAKING SUCCESSFUL REFERRALS
After some investigation and contemplation, it occurred to me that I had previously been more conscious on getting referrals versus giving them. The majority of my clients and IES corporate members in the past have been referred to me from people who work with CEOs and business owners who are struggling with growing sales because their marketing strategies were weak or non-existent. For me, and I believe a lot of my peers, the emphasis is often on being referable versus focusing on the giving referral aspect.
For example, to improve my likelihood of more getting, I personally invested in learning from some of the top experts on the topic. including Bill Cates, who is known as The Referral Coach. Bill was a speaker at the IES in 2013 and will be returning to our stage in April 2016.

Charlie Green, the co-author of The Trusted Advisor, one of my three favorite business books of all time, also spoke at the IES this past summer. Attending the event with me were over a hundred sales leaders who learned a lot that day from one of the true experts on trust-based referral selling. He helped turn my head about referrals.

Plus, I make it a point to participate in many lead share, networking, and business development groups, which are designed to bring in referrals.
So I’m pretty good at getting referrals but what was interesting to me here was that it felt much better seeing the results of my giving referrals, not just getting them.

GOOD RESOURCES MAKE GOOD REFERRALS
The first of my referrals was for an executive recruiter I’ve known for over a decade. We’ve been in networking groups together and had met often in business and social settings. I’ve listened to her business pitch dozens of times and enjoyed learning about how her firm had a different spin on the recruiting game. Last summer, I received a rash of requests from sales leaders looking for a recruiter who could help build their sales teams.

This particular recruiter had stayed in touch and regularly responded very quickly to any recruiting questions I had. She freely gave me insights I needed.  Therefore, she was top of mind when this rash of inquiries came in so I sent her name to all three inquiries without hesitation.
The second referral came from a speaker I brought to Washington to present at an IES sales workshop. Since the IES attracts a senior level sales audience, we are able to bring the top sales thought leaders and speakers to our stage. To make it even more worth their while to come to DC to speak, I frequently schedule introductions and business development meetings with good prospects for their services.
One of the meetings I arranged for this speaker led to a client engagement for sales training and in-bound marketing strategy. She was thrilled.

And in the third situation, a frequent attendee of IES programs contacted me with the news that her firm’s management team wanted her organization to be more sales-focused versus reactive.  She invited me to meet with her sales leadership to discuss recommendations I could make for a sales training resource that could help shift the sales culture.  This is a request I get frequently. Since I work with some of the top sales training companies in the world, I suggested a few that could make a big impact and presented their strengths to the team. They chose one of the companies I recommended and implemented a plan for a year’s worth of training. Everyone was happy.

THREE LESSONS I’M PASSING ON
The results of my referrals excited me for a few reasons. First, it felt good having companies come to me to seek recommendations on who the top sales resources might be. Second, it confirmed that the IES is a trusted partner for sales speakers, training referrals, coaching, services, and programs. Third, it deepened my relationships with some of my top sales services partners. And, fourth, it felt good knowing that I was supplying the companies that requested referrals with the highest-quality providers.
So here are three things you need to do to give more referrals.

1. Get to Really Know the Unique Strengths of Your Business Colleagues So You Can Refer Them Properly: I’ve met many people over the years that are very weak in explaining how they are exceptional. I’m a “trainer”, or “a banker”, or a “commercial real estate agent”, they’ll tell me. Well, like Colonel Jessup from A Few Good Men said, “I’m an educated man but I’m afraid I cannot speak intelligently about you without knowing more about what you’re specifically good at and who you best service.” Get to know what verticals they service, what level in the organization they usually deal with, and what value they actually bring so that you can recommend them accordingly.
2. Take a Break from a What’s In It For Me (WIIFM) Mentally: In marketing, we often hear that the customer wants to know specifically What’s In It For Me. That’s powerful guidance for anyone in sales because the sales messaging must accommodate that request. I get it. Makes sense since it’s a human that’s buying and you need to ensure they understand how you’re making their lives better. But in order to give referrals, it’s important to realize that it’s not about you, it’s about them. Build a comfort level around a good conversation even though you are not getting the gig.
3. Cherish Knowing that You’re Helping Your Colleagues Grow Their Businesses: There’s nothing better than getting a good referral from a trusted resource, so revel in the knowledge that you’re giving someone else that feeling. You’re helping them grow their business and generate revenue. You’re doing something real good, my friend.

I’ve learned that there are really three things a person can do to make a colleague’s life better. You can feed them, you can find them love, and you can help them earn a living. I never truly appreciated how powerful it can be to refer business to trusted colleagues until the blitz occurred this past month. I look forward to referring more and more business because of it.

​The DIAMOND Challenge is to proactively refer three trusted business colleagues to some of your clients within the next three weeks. Once you’ve accomplished this, give me a call and let me know how it made you feel.

By Ted Brown
 
Hackers don’t just target big firms; small and medium-sized businesses (SMBs) are equally vulnerable. With the explosion of connected mobile devices, cyber intruders now have multiple points of access to companies of any size, making it essential for leaders to set up procedures and policies that restrict access to sensitive company data, know who is accessing their networks, and lock out intruders.
 
As the owner or IT director of a small company, the sooner you start thinking about security practices and incorporating them into your business plan, the better your chances of success. Following is a checklist of cybersecurity best practices for SMBs:
 
1. Aim for security practices that are easy to use and difficult to circumvent. Train employees and inform partners and clients on ways to ensure data safety.

2. Choose strong passwords as your first line of defense. These tips help make your passwords hacker-resistant:

• Choose a text string that is 8 to 30 characters long. This string should contain at least one number, one symbol (such as $,_,!,&), one lowercase letter, and one uppercase letter.
  
• Don’t use dictionary words in any language.
  
• Don’t use:
  • License plates
  • Addresses
  • Pet names
  • Social Security numbers
  • Birth dates
  • Phone numbers
  • Any words related to your family, hobbies, vehicle, or work.
    

3. Go beyond password protection with multi-factor authentication (MFA). MFA requires more than one method of authentication from independent categories of credentials to verify the user’s identity for a login or other transaction. MFA combines two or more independent credentials: what the user knows (password), what the user has (security token) and who the user is (biometric verification).

4. Manage your technology assets. Know what’s in your network—hardware as well as software— and make sure you keep these assets up to date. When you acquire new assets or update existing ones, always change the default passwords.

5. Monitor 24x7x365. Hackers don’t work business hours. Set up alerts to allow for immediate action to minimize damage.

6. Audit security policies and procedures for compliance to industry standards. For example, the SSAE 16 (Statements on Standards for Attestation Engagements No. 16) verifies the presence of security controls and processes and results in a Service Organization Control (SOC) report attesting to the sound design and operating effectiveness of the controls and processes reviewed. 

7. Look to cloud-based network services providers to take advantage of robust security processes at a more affordable price. Make sure you understand the levels of security, the amount of technical support and guidance provided, and who is responsible for what.

Smart SMBs look for security measures they can take today, so they don’t miss out on opportunities tomorrow.
 
Ted Brown is Vice President of IT Operations at Network Alliance, Inc., a leading network management solutions provider in the Greater Washington, DC region.