Don't turn away the borrowers that the majors don't want, instead convert them, writes broker Bernie McIntosh
As a mortgage broker, expanding your business and putting yourself in front of the right clients can seem like a difficult task. Many brokers often rely on client referrals to build their network, without realising the ways in which they can help themselves. Rather than investing in expensive and time-consuming marketing strategies, the most successful brokers often find the best way to grow their business is to go back to the basics. So where do you start?
First and foremost, it’s all about sales so look at ways to increase them by helping more people. Around four in every ten people consulted by a broker will not meet the traditional lending requirements of the major banks. These may be individuals or contractors whose income fluctuates from time-to-time, or those who may have defaulted on a utility bill. Following the banking royal commission earlier this year, the proportion of individuals who will likely be turned away by major lenders is only set to increase.
This segment of people represent a vital opportunity for brokers. In understanding how to increase the chances of converting these individuals, a broker has the potential to grow their business exponentially.
Know your client and their story. This way you will be better positioned to ‘sell’ the transaction to a lender. If a lender has to guess, they will be less inclined to say ‘yes’.
Establish a relationship with a number of lenders. Not all lenders are suitable for every loan scenario. Make sure that you have a number of reliable relationships that you can utilise to cover the majority of potential situations.
Use the resources of your aggregator. An aggregator’s BDM may be able to direct you to the most appropriate loan provider when you are confronted with unusual loan scenarios. Don’t ‘pass’ on the scenario – ‘ask’ instead.
If all else fails, try the help of a non-conforming loan expert. Today the major banks are more conservative than ever. Non-conforming loan experts can assist by applying a flexible approach to the assessment of a client’s financial position, navigating the lesser-known loopholes and taking the time to find an appropriate solution that you otherwise might be unaware of.
Ways to better sell your wares
Brokers don’t possess a physical product that a potential client can assess or evaluate. You are the only tangible factor in the equation of the sale process, therefore it is up to you to display quality in what you do in order to establish trust and reassure the client that they should truly consider what it is you have to offer.
View this process as your chance to illustrate your capacity to provide service excellent and your ability to seamlessly guide them through the process and solve their problems.
Communicate often and be personable. Communication is a key driver in building trust with your clients as it encourages a culture of transparency and openness between the two parties. In keeping up regular contact, clients will feel reassured throughout their experience. And, nothing beats the intimacy of a phone call — it keeps the process human and personal.
Be compassionate. Demonstrate a genuine understanding of your clients’ situation and be clear around how your service will help solve their problem and improve their life. Compassion goes a long way in forging long-lasting, personal relationships with your customers that are built firmly on trust, especially when complicated circumstances are involved.
Simplify your language. For those outside the industry, jargon and technical language can be overwhelming and hinder your ability to establish a connection. Unless it is necessary, ditch the financial speak and instead use clear and simple language when you can. Likewise, your client won’t necessarily be familiar with industry acronyms so try to avoid them, or explain exactly what they mean when you do. Take Jamie Oliver as an example – he establishes a connection with his audience by speaking their language. When explaining a cooking process or describing a product, he typically uses the technical term or name first, before explaining it in layman terms. It’s this simplification that makes him likeable and relatable to his audience.
In terms of increasing your client base, it goes without saying that much of it relies on who you know, and brokers tend to be natural networkers by trade. Having said this, opportunity always exists to spread your net further and sometimes we forget that our own backyard can be ripe for the picking. Try tapping networks you might have overlooked. This could include making yourself known at your local school, shopping centre, or community club.
As a broker, forming the right relationships and growing your business can often feel like an arduous task, when in reality, all that’s missing is the right approach. Take the time to invest in your clients, become known in your community, and ensure you put yourself and your business in touch with useful contacts. At the end of the day, potential clients will always lean towards the broker who keeps things simple, personal and genuine.
Bernie McIntosh is the managing director at Victorian Mortgage Group, an Australian financial services provider that has been assisting brokers and borrowers since 1946. The team specialises in home loans, debt consolidation loans, and small business loans, providing flexible lending solutions to help borrowers achieve their financial goals.
