The best brokers focus on the customer experience

The past few years has seen the government put the squeeze on mortgage brokers, asking them to justify the commissions they receive with the upfront and ongoing service they provide.

Good brokers recognise this but the following tips from top mortgage brokers show that the best in the industry have been focused on the customer experience for years despite the regulatory changes.

Skills can be taught but attitude is everything

Did you know that some of the most successful mortgage brokers had no previous experience in banking or in credit departments?

That’s not to say that this is the key to success (hardly!). What it means is that brokers that can adapt quickly tend to also be quick learners.

And, in order to be successful, you have to want to continuously learn.

This is the reason a lot of older brokers who have been in the industry since before the National Consumer Credit Protection Act 2009 (NCCP Act) tend to pull up stumps during rapid industry change.

Being conservative when assessing an application is not a bad thing.

However, when it means you fear failure and are less obliged to learn and adapt, you’re putting a ceiling on your own career progression.

Think you have the right attitude?

Feel free to send through your expression of interest in joining the Home Loan Experts team to careers@homeloanexperts.com.au.

Resilience

Abacus Finance founder and director Kellie Lam likes to live by the mantra of Henry T Ford:

“Whether you think you can or whether you think you cannot, you are right.”

Your attitude is the single greatest double-edged sword you hold, she said.

We all get knocked down in life and at work but what top mortgage brokers have in common is that they don’t let defeat and mistakes bog them down for too long.

And, to be clear, you’re going to fail – a lot – when you first get started as a broker.

Customers demand honesty

You don’t have to know all of the answers as a mortgage broker.

In fact, top brokers like Astute Finance finance manager and director Josh Egan (speaking to The Adviser) said he never provides information or guidance to a client unless he understands the problem first.

The best brokers don’t fake it: they admit when they don’t know the answer and tell their clients just that.

Clients advice want frank advice without beating around the bush.

Knowledge is power

Empowering yourself and your clients with the right guidance and technical skills will pay dividends in the long run.

Your clients will come back because they will feel that you truly care about their challenges and financial goals.

However, as a mortgage broker, staying up-to-date with changes to lending policies, fluctuations in the real estate market and discovering better ways to manage your workflow aren’t just going to be handed to you.

The best brokers are inbuilt with the desire to always be a better mortgage broker and business owner.

Keep yourself open to new opportunities and deals you haven’t handled before. The more you do this, the more knowledge you will gain.

Continuous development starts with initial training so check out our page on the mortgage broker training process.

Respect at all levels

Not only do top mortgage brokers respect their customers but they also respect their support staff, their colleagues, their relationship managers and the key decision makers in the credit departments.

You need to be a great relationship manager at all levels of interaction.

If not, it could come back to bite you: a poor testimonial here, a relationship manager unwilling to assess your application there, and then a support staff member being undervalued can quickly turn your success into a downward spin.

Your reputation is everything and not something that is easily regained after a lapse of judgement.

How do you find out who’s the best mortgage broker? Here’s how!

Golden rules for selling

Whether they’re from a home loan specialist or mobile lending background, many new mortgage brokers think sales is like The Wolf of Wall Street.

Nothing could be further from the truth.

The fact is, most borrowers you deal with will be first home buyers or first-time investors and they have much more straightforward financial goals than a stock investor.

New brokers need to also quickly get out of the mindset that a customer owes you something because you’re spending your time speaking with them.

That’s according to Property Planning Australia managing director David Johnston, who said the best sales strategy is to ask a lot of questions and actually listen to your client.

“It’s amazing how many brokers don’t actually listen to their clients,” he said.

“Really unpack what they’re saying because it may not always be about buying a home.”

Get into the habit of repeating back what the customer just told you.

Once you know what the client wants, you need to create value or give them a reason to use your services.

Provide value

People only buy when they are convinced that your product or service is of greater value than the price/time that they’re giving to you.

For example, comparing the much lower interest rate you’re able to negotiate with a lender compared to two major banks offering the same product.

Another example is arranging debt consolidation with their refinance to put a client back on the path to financial freedom after the premature death of their loved one.

If you’ve listened to their situation and provided the solution that best matches their needs, Kellie said that you’re on your way to retaining their business for life.

What clients actually think about you

Customers make up their mind about you from the very first conversation (around 7 seconds, to be exact!).

“The longer you can keep someone on the phone with you, the more likely they will be to proceed with you,”, David said.

Apart from listening, try to also mirror a customer’s language.

First home buyers crave simplicity in the mortgage application and home buying process and they expect you to be upfront and get to the point when answering (what experienced brokers would deem as) basic questions.

On the other hand, professional investors will use terms like cash flow, negative gearing and rental income and they want a broker who can give them a mortgage strategy that matches their investment goals.

Setting expectations

The best way to handle objections is to preemptively set expectations.

Clients value flexibility, agility and responsiveness when it really matters but the client’s expectations can often be quite different to the reality of the mortgage process.

This is because of the regulatory and legal requirements you’re required to meet and the fact that so many parties are involved all the way up to the settlement process. You know this but most borrowers simply don’t.

You’re best breaking down the application and settlement process into milestones.

Once they make an enquiry with you, be realistic as to when you can come back to them with recommendations. The next morning, tomorrow afternoon, or later that day?

Notifying your client at the completion of each milestone and setting the next time frame is essential because it shows that you value their time.

A typical home loan process may look something like this:

• Enquiry
• Recommendation
• Submission
• Pre-approval
• Unconditional approval
• Loan documents posted
• Ready for settlement
• Settlement

If the process gets delayed for whatever reason, don’t make excuses and tell them the truth.

For example, if the credit department hasn’t gotten to your client’s application yet because they’re handling a large workload, tell your client this and assure them that you’ve escalated their application.

Another example of setting expectations is when the customer has an unusual situation, such as bad credit, debt consolidation, buying in a trust structure like an SMSF or purchasing a unique property like a hobby farm.

There are a number of expectations you need to set here including:

• The potential of getting approved at all and identifying where the credit issues lie.
• If there are lenders that can help, explaining that they may be charged a higher interest rate.
• If it’s with a specialist lender, explaining that their credit and loan processing departments are smaller so the application process will take longer than going with a major bank or lender.

Handling objections

Sometimes there’s no way of covering all the bases of concern that a customer has – sometimes they can come straight out of nowhere!

For Kellie, all objections are opportunities to “understand the customers’ point of view and to calibrate the benefits we are providing with their needs.”

Other top brokers like David relish the opportunity to have a real conversation with his clients but he said that new brokers have the tendency to get defensive.

The trick with being thrown a fastball from your customer is to not only catch it but to flow with it.

“If they’re concerned, say that, “I totally understand what you’re saying”,” he said.

“You should recognise their concerns and embrace their objections because how you handle them is how you build trust.”

For example, a customer may be concerned that there is the potential for their parents to lose their property in a guarantor loan arrangement.

Recognise that there is certainly that risk but why the risk is minimal for several reasons.

By equipping your clients with the facts, they will feel like they’re making an informed decision. That’s because they are!

Communication

Get into the habit of getting back to clients as soon as possible.

“I used to make it a point that I wouldn’t finish up my day until I got back to every client that called or emailed me that day,” David said.

Even if nothing has happened with their file yet, tell your clients that the lender is still in the process of assessing.

Any news is better than no news and the communication should always be initiated by us and not by the customer.

How to generate repeat and referral business

Top mortgage brokers will say that repeat and referral business will come if you do all of the above.

“The two keywords are consistency and value: consistency in our availability and in our communication, promises and knowledge help to build trust.,” Kellie said.

However, you have to be vocal about it if you believe that you’ve truly done a great job.

Be proud of what you were able to achieve for the client and ask them for a testimonial to refer to friends and family.v

They will be happy to give you an amazing review if they were truly satisfied and, to be clear, online reviews are so important for getting new business.

Top brokers urge newbies to ask their clients to post testimonials on Google reviews and Product Review.

In terms of getting repeat business, David said staying in regular contact is essential.

If you’re not contacting your existing client book, they’re going to take their business elsewhere.

However, he said this doesn’t have to be a pain point for you and your already manic workload.

The method you employ really comes down to the size of your loan book and how important it is to retain the client.

“The way I follow up clients is a mix of admin support and me personally calling customers,” he said.

“We set reminders for home loan anniversaries, call them twice a year, and ask them pertinent questions to guage the effectiveness of their current mortgage strategy – we are always solutions-focused.”

In cases where the client is actively calling you to refinance, don’t shoot yourself in the foot!

Every time an existing client calls or emails, reply to them and come back to them with fully-committed answers.

How to build a support team

Having a broker support team means you can focus on what you do best: speaking to clients and finding them the right solution.

Once the client decides to proceed, collecting documents and all of the nitty-gritty of the home loan application process should be handled by well-trained support.

That means you shouldn’t have to be chasing clients for relevant documents or chasing banks for approvals.

However, building a great support team is easier said than done.

When hiring, you ideally want to look for candidates that have worked in lending.

David said that a branch manager who is looking to scale back is perfect but these types of candidates are few and far between.

“You’ll also want someone with career ambitions and plans to transition to becoming a mortgage broker: this is a sign that they will take their role seriously,” he said.

Apart from experience, Kellie said they need to come to the table with the same attitude, work ethic and either match or be willing to buy into your shared vision for the brokerage.

What you shouldn’t overlook is the amount of time and money you need to invest to make a broker support team viable.

They need training and development, and there need to be systems in place that allows them to do their job effectively.

“All roles should have clear objectives, and guidelines on how to achieve those objectives, but you should allow for new ideas on how to make the processes simpler and more effective,” Kellie said.

“As the people who do it day in day out, support tend to be the most effective in finding the shortcuts so these ideas should be welcomed and tested.”

Wouldn’t outsourcing be cheaper?

Take your investment to build a support team and double it.

Yes, over the long run, outsourcing can be a lot cheaper but you have more boundaries to overcome than just skills.

You have to also contend with language and cultural barriers, with the latter particularly pertaining to quality and productivity standards working for an Australian-based company.

Having proper processes in place is essential and then it comes down to good management, quality control and having great communication channels in place to deal with time differences.

Did you know we outsource all of our support team functions?

Alternatively, you can send your resume to careers@homeloanexperts.com.au.

Coping with the changing regulatory environment

In light of the industry moving to self-regulate through the Combined Industry Forum (CIF), how can new mortgage brokers cope?

There are often discussions about cutting off mortgage broker trail commissions but this will only see truly great brokers leave the industry.

Those mortgage professionals who are doing a truly magnificent job deserve to be paid for the mammoth effort and time they put into providing a customer experience that banks regularly fail to provide.

The way the industry regulator is proposing to target brokers who aren’t acting in their clients’ best interests is like throwing the baby out with the bath water.

What top mortgage brokers can agree on though is that the introduction of the NCCP Act, and the subsequent licensing and compliance tweaks that have followed, have only seen the industry become more robust and legitimate in the eyes of many consumers who still don’t fully understand what a mortgage broker does.

Luckily, this is changing and regulations shouldn’t be anything to fear if you’re doing the right thing and providing value to your customers.

“This is the best time to be in the industry – changes in regulation always weeds out practitioners who seek to abuse the system,” Kellie said.

“This reduces competition and, those who are entering the industry will not know any better and will be more flexible to adapt to the new environment.”

Getting the work/life balance right

Life as a mortgage broker can sometimes mean late nights and even working some weekends.

The reality is that you have to work around a client’s own work/life schedule so there will be some obvious cross-over that will make a standard 9-5 work day impossible.

Prioritising your values is key so you have to set goals for how quickly you want to grow and work out ways to work smarter, not harder.

“I always say to myself that I own the business: the business doesn’t own me,” David said.

“I ensure I maintain balance as I see too many people swallowed up by the all-encompassing aspects of running a business.”

Setting boundaries on how many hours of the day you work is one way to cope and then it’s a matter of scheduling in the rest.

Kellie sees managing her life commitments like managing her business: you plan well, execute it, and leave nothing to chance.

Interested in becoming a mortgage broker?

Email your CV to careers@homeloanexperts.com.au and we’ll call you for an interview if we think you’re the right fit to join our team.