New mortgage brokers are struggling with the ‘fear of being found out’ because the current system ‘throws them in the deep end’, says business author, ex-broker and National Finance Institute trainer Peter Heinrich
Much has been made of the need for young blood in mortgage broking. But even if the industry can manage to attract new talent, how can rookie brokers navigate the lending landscape without risking an early burnout?
From the older system of starting as a lending assistant and being monitored for a period of 4-5 years, brokers are now going into the field with little to no support, says National Finance Institute trainer Peter Heinrich.
Business owners are pushing new brokers to start writing loans with only the basic accreditations because of a reluctance to employ brokers who aren’t making good money from the outset, he says.
“The number one thing that people always speak to me about is ‘How can we get them on to the field quicker?’, because the fear is that they’ve put them on, they’re paying for them, but they’re not being productive. My argument is that cutting back on that learning time is actually false economy.”
In his book The Mortgage Marketing Handbook, Heinrich looks at survey responses from brokers exiting the industry.
Of those who quit mortgage broking before writing their 10th loan, a leading reason for doing so was the pressure they felt to get in front of clients before they had the confidence or the knowledge to do the job well.
“They’re probably getting leads, but what they do is they avoid them because they’re scared they’re going to be found out; that they’re going to get in front of a client and not be comfortable with the technology or the products so they won’t sell.”
The adage of throwing new entrants into the deep end has no basis in reality, says Heinrich.
In at the deep end
“They say if you throw them in the deep end they’ll learn to swim – no they don’t, they drown! Whenever I’ve seen that happen people have got to jump in and save the person, and that’s exactly the same with mortgage broking.”
Some of the problem stems from brokers being constantly pressed for time, and some from the fact that brokers have forgotten what’s it’s like to be new, he says.
“It’s never going to work if you say ‘I’m successful, I’m writing lots of loans, so should you’.
You have to show them what it is that made you successful. If somebody says ‘I got by’, it was sheer luck, you need to take a more structured approach and actually train the people.”
Learn from the best
The best firms are taking on new brokers and letting them work under their best brokers for a number of months, he says.
“And they don’t see it as a chore, they see it as necessary. If you want that person to write a lot of loans they have to have that knowledge.”
Heinrich is a firm believer that the industry needs new blood, and says the onus is on the large aggregator groups to implement a kind of apprenticeship scheme. Thankfully, a number of new initiatives are being launched to train rookie brokers in a structured environment.
Heinrich is a firm believer that the industry needs new blood, and says the onus is on the large aggregator groups to implement a kind of apprenticeship scheme.
A system whereby new brokers shadow successful brokers for a short period of time, assisting with loans and earning a salary, and then are gradually phased into earning commission and writing their own loans, would support new brokers and lower failure rates, he says.
“We train how many thousands of people a year, and only 10% of that will become really good brokers, and that’s a shame because they’ve got the right attitude in the first place, they just need to find someone who’s prepared to put the time into them and help them.”
Key takeaways
• Remember that even though you’re experienced with lending, new entrants aren’t. Tasks you take for granted may need a thorough explanation
• Don’t take on new staff if you can’t devote the time to training them
• New brokers who have burned out quickly often say they were put in front of clients before they had the knowledge or confidence to do their job well
• A structured training approach will give new entrants a better opportunity for success than ad-hoc on-the-job training
From the older system of starting as a lending assistant and being monitored for a period of 4-5 years, brokers are now going into the field with little to no support, says National Finance Institute trainer Peter Heinrich.
Business owners are pushing new brokers to start writing loans with only the basic accreditations because of a reluctance to employ brokers who aren’t making good money from the outset, he says.
“The number one thing that people always speak to me about is ‘How can we get them on to the field quicker?’, because the fear is that they’ve put them on, they’re paying for them, but they’re not being productive. My argument is that cutting back on that learning time is actually false economy.”
In his book The Mortgage Marketing Handbook, Heinrich looks at survey responses from brokers exiting the industry.
Of those who quit mortgage broking before writing their 10th loan, a leading reason for doing so was the pressure they felt to get in front of clients before they had the confidence or the knowledge to do the job well.
“They’re probably getting leads, but what they do is they avoid them because they’re scared they’re going to be found out; that they’re going to get in front of a client and not be comfortable with the technology or the products so they won’t sell.”
The adage of throwing new entrants into the deep end has no basis in reality, says Heinrich.
In at the deep end
“They say if you throw them in the deep end they’ll learn to swim – no they don’t, they drown! Whenever I’ve seen that happen people have got to jump in and save the person, and that’s exactly the same with mortgage broking.”
Some of the problem stems from brokers being constantly pressed for time, and some from the fact that brokers have forgotten what’s it’s like to be new, he says.
“It’s never going to work if you say ‘I’m successful, I’m writing lots of loans, so should you’.
You have to show them what it is that made you successful. If somebody says ‘I got by’, it was sheer luck, you need to take a more structured approach and actually train the people.”
Learn from the best
The best firms are taking on new brokers and letting them work under their best brokers for a number of months, he says.
“And they don’t see it as a chore, they see it as necessary. If you want that person to write a lot of loans they have to have that knowledge.”
Heinrich is a firm believer that the industry needs new blood, and says the onus is on the large aggregator groups to implement a kind of apprenticeship scheme. Thankfully, a number of new initiatives are being launched to train rookie brokers in a structured environment.
Heinrich is a firm believer that the industry needs new blood, and says the onus is on the large aggregator groups to implement a kind of apprenticeship scheme.
A system whereby new brokers shadow successful brokers for a short period of time, assisting with loans and earning a salary, and then are gradually phased into earning commission and writing their own loans, would support new brokers and lower failure rates, he says.
“We train how many thousands of people a year, and only 10% of that will become really good brokers, and that’s a shame because they’ve got the right attitude in the first place, they just need to find someone who’s prepared to put the time into them and help them.”
Key takeaways
• Remember that even though you’re experienced with lending, new entrants aren’t. Tasks you take for granted may need a thorough explanation
• Don’t take on new staff if you can’t devote the time to training them
• New brokers who have burned out quickly often say they were put in front of clients before they had the knowledge or confidence to do their job well
• A structured training approach will give new entrants a better opportunity for success than ad-hoc on-the-job training
