Building a Mortgage Broking Business

Building a Mortgage Broking Business

Some of the points covered in this article are intended principally for new or inexperienced mortgage brokers but even if you’ve been around the block a few times you might like to spend five minutes skimming as we can all fall back into bad habits or simply forget to pay attention to some areas.

6 point plan for building a mortgage broking business

 I suppose this is a 6 point plan because some of the points can be used in other areas, but also because if it were a 20 point plan it might be in danger of becoming a tick box exercise rather than having anyone think about it.  Thinking about the 6 points is the whole point of the exercise really, don’t just whiz through them with a “done that”, “done that”, doesn’t apply”.  To get the best out of the advice you need to think about it, and if you’re already doing it, think how you could do it better?

Point 1

 Marketing for Mortgage Brokers

 This is just so important with specific elements in points 2 and 3 as well.  If your business fails, it won’t fail because you can’t “do” the mortgages, it won’t fail because there “aren’t” the right insurance or mortgage products, it’ll fail because not enough people want to do business with you.  That might be because your service levels are poor, or your business don’t seem professional, or simply because not enough people know you exist.  It all boils down to perception, “I look professional; have smart stationery a clean well laid out website, so I’m a good mortgage broker”.  “You’re walking around in your pyjamas, you don’t use printed stationery, you use a Hotmail, email address and you smell bad.  This says you’re not professional, you probably don’t know what you’re talking about and you’re quite possibly dishonest as well”.

Crazy isn’t it, most big mobsters wear suits and I’ve known some sharply dressed sharks in this industry that made Jaws look like a goldfish but it’s all down to perception.  Marketing isn’t going to save your business on its own, but it is your biggest ally and lack of it will sink you.

Make sure you look smart, and if you work from an office make sure it looks clean.

Give the business a name and a web domain, do it now….right now, It’s cheap and easy.

Use the web domain, at the very least buy a simple clean 2 or 3 page brochure website.  Try to keep it up to date and always use your domain for your email address.

Spend some time designing your business cards and headed paper or if you’re not that way inclined, you can pay someone a modest amount and get it done for you.

Get yourself a logo, not important? OK name one major UK company that doesn’t have one, even Which Network has one and I’m notoriously mean?

If you work alone, transfer your calls to your mobile when you’re out of the office.  Always remember that client, who wants the big mortgage and all the insurance might well ring elsewhere if they can’t get you.

Consider using a virtual PA service, they can be expensive but if you use one that charges per event or on a time basis rather than one with a high monthly charge it needn’t cost too much, and if you work from home what about your partner or teenage kids answering?  All they have to do is say you’re out and take a message, show them what you want…..simplez!

Point 2

Remember you’re a mortgage broker not Santander or The Halifax

Make sure you don’t lose yourself, if your prospective clients wanted to go to the Halifax or Santander, then they would have. This means they wanted the personal touch not Robo advice, they wanted someone to sympathise with their problems, laugh at their jokes and be impressed by their triumphs… know that’s you!  It’s not usually a good idea to use corporate speak, always be on a first name basis and don’t try to put on a BBC accent, unless your client works for the BBC of course.

Remember, generally people buy from people like them.  If you’re working locally, use local points of reference, football teams, areas, and people in conversations.

Point 3

 Work that client base

 Amazingly there are still businesses out there that don’t pay enough or even any attention to their existing client base. The reasons why this isn’t a good idea are so well known and so often mentioned in the press that I’m almost too embarrassed to mention them here but since this information is vital, particularly in these troubled times you really do need to make sure that you have addressed the issue completely (not just adequately)!  If you haven’t read it before have a look at our article “Self-Generated Mortgage Referrals” regarding this subject on the Which Network website.

Point 4

 Keep your business budget tight

 There is an old and very true saying “A business can never prosper on cost cutting”.  The point being if you move into a small packing case, switch all the lights off and talk to nobody, it’s unlikely you’ll be a success, but by the same token, in the real world if you can cut costs by £2,000 per annum, that’s your annual holiday paid for (I’m a cheapskate I know).  The biggest cost for many small firms and certainly individual brokers can be the cost of an office.  Do you need one, and if so does it need to be so large, does it need to be prestigious and in an expensive part of town?

This is of course at least partially dependent upon how you work and your clientele, but it’s worth looking at.

Having spent many years in the financial services sector and a few of those as a business development manager I have seen all sorts of models work.  I have seen very successful brokers with a large high net worth client bank who have always worked from home, in some cases for over 20 years, and on the other hand I’ve seen a moderately successful mortgage broker move from a home office into an £800 per month town centre office, sit and wait for someone to come in and go broke waiting.  Could you share an office?  If you need somewhere to meet important clients is there somewhere local where you can hire a meeting room for a half day or by the hour. As an alternative, why not take your client for lunch.  It’s normally cheaper than hiring a room, the client will feel very special and you get fed into the bargain.  It doesn’t get any better than that. Remember, it doesn’t matter how large or small your business is cost control is still important.

Point 5

Sell Everything, Not Just Mortgages!

 I don’t mean china mugs or nodding donkeys.  I do mean make sure that you cater for all of their financial needs.  Not just their mortgage and associated protection.  Have they got CIC, did you quote for their building and contents?  Have you advised them on family protection insurance?

When a family loses its bread winner it’s small comfort knowing the mortgage is paid off if they haven’t got the money to live on and have to downsize and move out anyway just to live.  If you find it difficult to keep track on who has what try using  a product spreadsheet or magic matrix as it’s sometimes known to keep track of what you have and haven’t talked about.

Look at ancillary products as well, will writing isn’t the most exciting of add-on’s but it does produce an income and more importantly lead to referrals.  You may not be qualified to sell investment and pension products but finding a trustworthy Financial Adviser to introduce this business to can increase your income by up to 50% just by picking up the telephone.

Point 6

 Although you’re a mortgage broker you still need to look after yourself

 The only issue that is more important than marketing, in fact this point overrides everything.  Obviously you can’t effectively run a business from a hospital bed or worse still the morgue, but there’s more to it than that.  Too much stress can rob you of your ability to make the right decisions and drastically reduce your levels of concentration to an extent that you miss opportunities and could leave your clients without the right cover and you down on your income.

Easily said of course but in reality what does it mean? Well everyone will tell you, “don’t eat too much, and don’t drink too much alcohol” obviously, but also take time out to relax.  If you’ve been working for a few hours and you feel your concentration wavering or you are just feeling weary.  Stop working and go for a walk or just do something else, taking an hour out will more than repay itself in increased production later in the day.

Try to get to the gym or do some running, football or some other sport.  You won’t believe how good it can make you feel and it might even be the start of a new you?  If that still doesn’t de-stress you, look at relaxation therapy, and at the risk of being accused of “getting all Zen” realise you are so much more than your work. What everyone is really after is a happy life and your business is only one step on that.