Most people rank shopping for a home loan somewhere between hosting their in-laws and getting a root canal.
The internal dialogue can go something like this:
Am I getting the best deal?
Are there hidden fees?
Points? What??
Where do I even start?
Buying a home can be enough of a complicated decision without your clients wondering if they are getting the best deal, trying to figure out what the heck “points” are, and/or feeling like they need a degree in mortgage law to make good choices.
Then there’s the time shopping loan options takes while they’re also busy trying to, you know, pack up their ENTIRE LIVES and move. (Don’t even get me started on the decluttering!)
What if you could connect them to someone who could do all that comparison work? Who could explain all the options in terms they actually understand and help them figure out the choices available given their unique finances?
Poof!
Meet the Fairy Godmother of finding mortgages and your secret competitive weapon… the mortgage broker!
The ability to shop loan options instead of going the traditional bank route can offer plenty of competitive advantages for both the mortgage broker and you as the real estate professional.
Plus, you look like a rockstar to your grateful clients.
WIN.
So what about working with mortgage brokers makes them the potential answer to your competitive advantage dreams?
I was hoping you would ask!
Tailored solutions for (just about) every client
Mortgage brokers have access to loan products from a whole host of different lenders.
Your clients’ financial needs and circumstances are unique to them. One may be a young couple who is buying their first home on a teacher’s salary, and the next just took their company public and is out to find the multi-million dollar beachfront mansion of their dreams.
Can a traditional loan officer help them both find the loan that best fits their needs and circumstances?
Maybe.
But maybe not.
A traditional bank has one limited set of loan products to work with. A mortgage broker works with a bunch of different lenders, giving them the ability to tailor loan options to each unique financial situation.
Speaking of our teacher and our dotcom millionaire…
They could have a line on a lender who gives special rates to first-time homebuyers, while simultaneously connecting you with another who specializes in luxury real estate and complicated income situations.
Some lenders only work with mortgage brokers, so they can bring lending options to the table that your clients otherwise don’t have access to.
One point of contact, hundreds of loan options, and mortgages tailored to the needs of each unique client.
Who’s the rock star now?
Bargaining power
Mortgage brokers can make extreme couponer Aunt Sally look like an amateur. These folks are serious shop-around professionals.
Because they work with multiple lenders and can take their (your!) business elsewhere if they don’t like what’s being offered, they can often negotiate better rates and terms on behalf of their (your!) clients.
“[Mortgage fees] include origination fees, application fees, and appraisal fees. In some cases, mortgage brokers may be able to get lenders to waive some or all of these fees, which can save you hundreds to thousands of dollars.” (Investopedia)
Unfortunately, interest rates are currently higher than in past years and the Fed does not seem to feel inclined to lower them any time soon, which feels like a serious bummer for anyone trying to buy a home right now.
However, the ability of a broker to potentially find lower rates than can often be offered by direct or traditional lenders can make a real difference in bottom-line mortgage payments.
At the very least, they can bring options to the table instead of a single love-it-or-leave-it rate.
Express closings
Remember the frenzied days of having 22 offers on the same property in less than 24 hours?
Things may have slowed down a few notches from that level of insanity, but today’s market is still much faster-paced than it used to be. Turning things around quickly can be critical to delivering on your client’s homeownership dreams.
And a big part of fast turnaround can be streamlining the approval process. You want your ducks in a row when your clients have that “This is IT!” moment.
As you well know, the application and loan closing processes can be frustrating and stressful, especially for first-time buyers. The back-and-forth with document requests, piles of required paperwork, and i-dotting and t-crossing can be overwhelming. Here’s where a good mortgage broker can also ease the way for your clients.
“A mortgage broker will generally handle the paperwork and lender wrangling on your behalf; a good mortgage broker will save you time and stress.” (NerdWallet)
Because brokers have relationships with many different lenders, they know the options and requirements they’re working with. Faster options mean a fast track to the closing table.
Expertise at your fingertips
A mortgage broker’s contacts are usually jam-packed with different lenders who offer different choices and options, so chances are they have pretty much seen it all.
In addition to in-depth knowledge of a huge range of loan products, they are also typically on top of market trends and regulatory changes. They have to be able to know which options might fit with a client’s specific financial situation.
This gives them the ability to guide your clients through complex scenarios and provide personalized advice to help guide them to the decision that feels the most right to them.
First priority: your client
Mortgage brokers work for the client, not for direct lenders or banks. They can keep the interests of your client front and center when sifting through loan options.
And since they are commonly independent businesses…
Corporate-mandated sales targets?
Shoehorning clients into products that may not be the right fit?
Putting what a bank wants above what the client needs?
Nope.
This freedom can allow them to not only provide truly personalized service, but a level of client advocacy that is not typically found in direct lender/bank channels.
A broker also maintains its relationships with various lenders by bringing them business, so the more business the broker can bring to a lender, the better terms and rates the broker can potentially negotiate for clients.
Remember, a mortgage broker has a reputation to protect too and often has the same customer service goals. The more the broker makes your clients happy, the better its chances of repeat business and solid word-of-mouth marketing.
Happy clients = happy mortgage broker and happy you. More winning!
So mortgage brokers are cool. Got it.
But what does this have to do with my goals for my real estate brokerage?
Simple.
If you are looking to elevate your game, embracing the advantages that come with a savvy mortgage broker partnership can level up your strategy. Especially in today’s competitive marketplace.
Ready buyers
A mortgage broker can help make sure your clients are financially vetted by shopping loan options and often get them pre-approved or pre-qualified faster than direct lenders or banks.
A client that is ready to pull the trigger is more attractive to sellers.
A ready buyer means a higher likelihood that the deal gets signed, sealed, and delivered.
A more attractive buyer means a greater chance that they end up with the home they’ve fallen in love with, even when they have offer competition.
Streamlined experiences
Having options for just about everyone so all the pieces can fall into place when they need to means fewer delays and complications.
Smoother, faster closings make everyone happy – your client could have a hassle-free path into their new dream home, and you can launch another happy, referral-primed client.
Bigger client base
Everyone is competing for clients, right?
What if you could refer clients to a broker who can find a broad range of financing options, particularly for more… interesting situations, like a small business owner or a retired co-signer with only real estate dividend income?
Just like that, you’ve expanded your potential client base.
Heck, you might even be able to build a reputation as the one in town who can deliver solutions when most of the rest can’t. That’ll strengthen your go-to credentials.
You can intensify these advantages by bringing a mortgage brokerage in-house, so your clients potentially don’t even have to call a different number to figure out their mortgage options.
Solutions like Motto Mortgage can make it easier to add these services to your current brokerage with their Mortgage Brokerage-in-a-Box solution. It helps you hit the ground running with your own mortgage brokerage.
Personalized real estate and mortgage brokerage services all under one roof?
That’s pretty compelling.
And talk about a competitive advantage your clients will love!
A potentially seamless buyer experience from beginning to end, the ability to shop loan options to find your clients the right fit, and a streamlined process that gets them into their new home with minimal headaches and complications.
Mortgage loan degree not required.
Whether you decide to work with an established mortgage broker or expand into mortgage brokering yourself, a relationship with a good mortgage broker can be a strategic tool that can lift your business head and shoulders above your competition.
In a crowded market where differentiation is key, it is also a value-add that can help you land new clients, clinch deals, and upscale your reputation for amazing customer service and client care.
And that is something you can take to the bank.
Published on May 31, 2024
