Customer service and reliable referrals

Make yourself indispensable to your clients and they will repay their gratitude in kind.
 
Property Advisor and Lending Strategist Matthew Clark shares his insights on the unique broker-client relationship.
 
My observation of the Mortgage Broking world during the last 15 years has shown me that we have a choice:

1. Race to the bottom and fight for the lowest rate for the client (which we can almost never achieve due to the banks online presence).
2. Become a lynchpin for our clients, the trusted adviser, indispensable.

The broking world has evolved, satisfying a demand in the marketplace that the banks underestimated. Whilst the banks were consolidating and centralizing, brokers were turning up and developing relationships. Mortgage Brokers have done so well in caring for their clients that the major banks have changed tact, trying to copy the service model of mortgage brokers with branch managers forced to build relationship with both clients and brokers alike.

1. Race to the bottom

If we now only compete on interest rate, we will lose. If you look online you will find many mortgages that we cannot compete with purely on interest rate.  Obviously there is the advice component missing and yes the clients could potentially be costing themselves money with an incorrectly structured loan but I foresee that an ever-increasing percentage of vanilla mortgages will be transacted purely online. Similar to the music industry, retail, books, then journalism, online competition starts as something that may happen in the future but will have a marginal impact on the industry, then it becomes closer than we think and then one day it is the more accepted format of doing business in that space. As a broker we will never have the budget to compete in a purely online industry. It is a race to the bottom, low margin and high transaction business.

2. Become indispensible 

• Continue to emotionally connect with the client. Mortgage brokers are successful for many reasons but I believe we care for our clients. We are a part of their life, meet their children, work with them through the good and the bad but we give emotionally of ourselves. Clients are not a number to us.
• You will need to proactively be contacting the client, not just for a chat but to show them what they can do. If you wait for the client to ring you, you lose.
• You position yourself as the go to person and you generate opportunity
• You  facilitate the purchase, with a range of skilled professionals, either internal or external to your business. These professionals include a Property Advisor/Strategist, Financial Planner, Lawyer, Accountant and General Insurance Adviser. 
• The client has no regard for what you do, but highly values what you do for them.

When Mr and Mrs Smith come to you looking to finance their investment property, you must understand that everyone from their conveyancer, to their bank (the one you likely introduced them too!), their iphone and the real estate agent is asking for their finance business also. It is a credit to you that they take the time to give you an opportunity, often because they like you.

These opportunities will continue to diminish unless you educate them on the opportunities that exist once they have some equity in their home.
 
How would you feel if you were Mr or Mrs Smith.  Your Mortgage Broker contacts you congratulating you on paying down your home mortgage. Your broker mentions that people in your position consider investing in property and they have a trusted team of professionals that can assist, asking of that is of interest?

If my broker took them time to alert me to the opportunities that were available to me, introduced my to professionals to advise me in their respective fields, fully disclosed his relationships and financial remuneration for these introductions, acted as a lynchpin,  I would be genuinely thankful and from my experience clients who receive this service repay their gratitude in kind.
 
Successful Mortgage Brokers and those who will continue to not only be relevant but will excel in the future understand that Mr and Mrs Smith paying off their home is wonderful but introducing Mr and Mrs Smith to the option of successfully investing in property can mean:

• Raving fans, more referrals
• Larger loan sizes and greater respect from your preferred lenders.
• Greater trust in your finance recommendations, not purely price driven.
• Commercial arrangements with likeminded professionals.
• The law of reciprocity, the more business you introduce business to your network, the more business they will want to send back to you.
• Profit.

Matthew Clark is author of Amazon Bestseller The 2014-2015 Guide to Property Investment and is a Property Strategist/Advisor. Matthew’s property advice assists Mortgage Brokers, Accountants and Financial Planners to become front of mind with their clients.

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