3 Habits for Building a Thriving Broking Practice in Today’s Market

You’re here because you operate an established mortgage broking practice, already experienced success and wondering if you could or should take your practice to the next level.

The knowledge, skills and tools that you’ve accumulated to get to this point will not necessarily get you to where you’d like to be. If you truly want to grow, the journey ahead does take effort, and on occasion, it can be a testing or character-building experience.

With a host of different variables that influence deal flow, profitability, settlement volumes, asset value, work-life balance and your own sense of accomplishment, Ultimate Broker Insights will look at and discuss these variables so you can level up your broking practice.

Each article has been influenced by the pragmatic experience of working with mortgage brokers in Australia for over 9 years combined with the insights gained from having conducted over 8,500 one-on-one?coaching sessions.

Hopefully they inspire you to realise your own potential so you too can operate a broking practice that provides a sense continued professional and personal reward.?

……………………………………

As the mortgage broking industry continues to evolve, here are some fundamental habits that can help you to operate a profitable & rewarding practice - especially in the current environment.

Over the last couple of decades, many things have changed in the mortgage broking space. Lead generation strategies have evolved. Loan servicing has gone up and down. And new ideologies geared towards building a more profitable practice have come to the fore.?

Apart from this, the industry has grown significantly over time.? In 2014 brokers just cracked 50% of home loans being originated.? Now it’s 70%.? And larger loan volumes are being written as properties increase in value.??

As some would say, the past few years have been a great time to be a mortgage broker.?

That said, if you’ve been in the game for less than 10 years, you’ve likely not yet worked in an environment where interest rates are trending upwards.?

This, combined with a record high number of brokers means it is important to have a clear strategy & structure to ensure you achieve your own growth, income and performance goals.

With this in mind, here are some suggested actions that can help you maintain your focus and achieve the greatest output for your efforts.

Habit #1 - Track Your Results

There’s a host of metrics you could be tracking within your practice.

From financial metrics, to conversion ratios to lender specific criteria, the list of potential metrics could be a job in and of itself.

That said, to simplify things, if you operate a lean, small practice, chances are you will want to focus on a handful of ‘lead & lag indicators’ that provide context and insight around effectiveness of you and your team in terms of lodgements, settlements and anticipated revenue and profit.??

As an at least, these metrics would include # of appointments, lodgements and settlements.? In addition, reviewing actual revenue, profit and book growth also provides you more insight into the financial health and performance of your practice.

And to complement the above, most aggregator CRM’s now provide useful analytics to help you gain a deeper understanding of your practice based across several areas including but not limited to:

• Conversion per referral partner
• Conversion per broker
• Conversion per lender

All of which can help you identify how or where further training or support is needed to optimise efficiency and effectiveness.

And, with the appropriate level of accountability, be it from your team, BDM, business coach (such us as), it helps you to apply the appropriate level of focus and energy to derive the greatest return on energy and relationships.

Habit #2 - Take Action Even During Dry Spells?

There are moments in your practice when things go quiet. You won’t have any new leads or deals to work on, for example. And then within an hour, you’ve got 3 new files to be working on.

To remove the potential for ‘not knowing where your next deal is coming from’, it helps to have consistency around core actions that keeps enquiries ticking over and the pipeline full.

As you would know, there are a host of actions you could take, though instead of a ‘shotgun approach’ to a lot of things, considering progressively adding layers of marketing to your core? so that it is sustainable and manageable.

A simple yet useful way to identify where to allocate focus is to break your marketing down into 3 functions:

• Free (repeat & referral business, organic social media, family, friends)
• Partner (professional business partners, collaborators)
• Paid (sponsorship, paid ads)

?As a rule of thumb, I would suggest not investing into paid ads until you developed a great conversion process, as otherwise your money will be easily spent but you won’t see much if any return on that investment.

Further, doing 'more things' doesn't necessarily equate to 'better results'. As was said by a client the other day, "I'd rather get 70% of the referral from less people than 30% from a lot of people."

Having consistency around marketing & business development activities is an exceptional skill to develop so you minimise fluctuation in submissions, settlements and overall cash flow.

Habit #3 - Be Proactive

If you want to grow your upfront & trail, you'll need to be proactive around nurturing relationships.

Take a look at the changes you’ve seen in the credit environment over the last six months. For example, some lenders are promoting that they are "open for business", yet when a file is lodged with them, it is still scrutinised.

Knowing there is some volatility or ambiguity with how some files are assessed, how are you managing client expectations to navigate these moments??

The more you can be on the front foot and guide your clients from a position of confidence and opportunity, they will continue to see the benefits of working with a forward-thinking broker like yourself.?

Many a broker has said "I've got a sticky book" only to review their client numbers and realise how many clients have actually left them.

So if you have a mature loan book and you haven’t prioritised repricing or client reviews, it can be a simple and powerful strategy to deliver ongoing value, earn additional transactions and stay front-of-mind so even if you don’t rewrite the loan, they stay on the book and you can earn more recommendations to others they care about.

And, with the property market being red hot over the past 2+ years, it's possible some brokers might have developed a "I don't need to market my business" mentality.

Suffice to say, this won't cut the grade for most brokers as we head into 2023, particularly if you want to grow volumes & profit within your practice.

Being proactive prepares you and your practice for future changes and the challenges they may bring. The better prepared you are, the better your chances of success.

Ready to Build a Thriving Mortgage Broking Practice?

It can be a bit challenging to scale a mortgage broking practice these days. Although opportunities abound in the industry, there’s more competition. What’s more, the industry keeps evolving – what worked before may not work anymore.?

That’s why you should pay attention to the tips mentioned in this article. Track your results and monitor your progress. Use dry spells to discover new ways to develop your practice. Also, ensure that you are proactive and not reactive.?

These three key things will help you attract and retain more clients. You’ll also help ensure that your practice will remain viable, profitable and rewarding to operate even if we see a 'correction' in the market.

……………………………………

Do subscribe and share!

I’m James McCracken, Broker Growth Strategist, where for the past 9 years, I've coached brokers to grow their practices with structure and consistency.

Here are further ways I can help:

Speaking & presenting:?Would you like a tailored presentation for your conference or PD Day so your brokers can grow their volumes??Send me a LinkedIn message to request my speaker kit.

Deal Flow Plan:?Download a personalised plan that pinpoints growth inhibitors and options for operating with more structure, efficiency and consistency.?thesuccessfuladviser.com/dfp/

Ultimate Broker:?For established mortgage brokers only, this service provides guided support to accelerate settlement volumes, improve operational efficiency and reduce worth hours.?

Book an initial call?to see if there is potentially a fit.

To your continued success!

James