Even when the economy is struggling, businesses still need buildings from which to operate and people require residential properties to call home. Both big companies and everyday consumers apply for mortgage loans to help finance their real estate purchases, and most complete this process with guidance from a liaison known as a mortgage broker.
A mortgage broker works as an intermediary between the buyer of the real estate and the lender that will provide the financing for the purchase, usually a bank. As payment for their services, mortgage brokers earn a set commission (generally between one and two percent of the loan amount) which is commonly known as a broker fee. If you enjoy financial matters and possess an enterprising spirit, read on to learn how to become a professional mortgage broker.
Your Mortgage Broking Career Starts Gere
Mortgage brokers require great sales skills and an entrepreneurial outlook. If you have all those qualities and don’t mind being involved in complex real estate transactions, then it’s time to get started on your mortgage brokerage career. The good news is that mortgage transactions aided by a broker continue to account for a good amount of the overall mortgage market so you should be busy.
To begin assisting clients with their real estate loans, you will first need to secure a mortgage broker’s license. In addition, there may be additional regulations for mortgage brokers depending on your locality. Searching online for your mortgage laws can help you find out all the details about what will be required. In some areas, earning a college degree or completing pre-licensing courses may be necessary prior to becoming a mortgage broker.
Once you start working as a mortgage broker, you’ll find most days are consumed by getting mortgage pre-approvals from the lender, finding the best mortgage rates for your clients, filing mortgage applications and securing proper documentation, as well as advising customers of their financing options.
After gaining some valued experience as a mortgage broker, you may decide it’s time to start your own firm. Establishing your own business will allow you to be your own boss and expand your professional possibilities. Keep in mind, the task of managing and maintaining your own firm requires you to undertake many different tasks beyond writing loans.
Starting a Mortgage Broker Business
Defining your specific niche will be key to your overall success. Obviously you’ll need to have a good idea of who your new clients will be and how you will attract them to your firm.
Ask yourself some of the following questions: Will you focus on investors shopping for a rental property? Will you target corporations seeking commercial property? Will individuals looking for single family homes or condominiums be your main clientele? Who will you service and how will they find your mortgage brokerage? Will you need to consider your insurance options?
Marketing your professional services to the right people will make all the difference. For example, if you know that your community is mostly made-up of first-time home buyers then you may want to advertise via various social media platforms. If you believe businesses will be your staple customers, then you may want to join professional organisations such as your city’s chamber of commerce.
Setting up your Mortgage Broker Business
You will need to consider a few different factors when setting up your mortgage broker business. You’ll need to be clear about your short-term and long-term goals such as how much revenue will be needed to give you a profit. How much money will you need to pay for office supplies or business insurance?
It’s important for new owners of a mortgage brokerage to understand whether they have a non-compete agreement with past employers that may limit their ability to contact their old clients. Is there anything in writing that could keep you from contacting clients? If so, for how long will you be blocked from doing so? Will trail payments be paid for your current customers even after you’ve departed?
Implementing systems and processes that will deliver an exceptional customer experience will eventually generate more referrals and repeat clients. To do so, you will need to be clear about the following points, so that you are ready to deliver top notch services:
● Value statement
● Client engagement procedures
● Office location
● Business Insurance
Finally, creating a network of knowledgeable mortgage brokers will give you an excellent resource as you move forward. Creating relationships with local businesses is a wonderful way to build your reputation and tap into new referral sources.
No matter how you decide to define your business, at some point you will need to begin marketing your professional services. The best way to begin is to define who your target market will be and come up with a detailed plan for reaching those clients.