Assembling a successful mortgage team

How to build your own 'mortgage factory'

With the entrepreneurial spirit still a strong part of the industry and many brokers looking to set up their own operations, Canadian expert Gordon Ross examines three departments vital to assembling a successful mortgage team

Mortgage factory pictureMost mortgage brokers start out with the best of intentions, but fail because they take on too many tasks themselves. The reality is that, once you build your business to a certain point and reach a maximum sustainable volume, you simply cannot grow any further.

No matter how organised you may think you are or how efficient you may be at juggling phone calls, paper shuffling and handling client meetings, there are still only 24 hours in a day. This is when proper team building becomes a necessity.

Everyone has heard of the concept of synergy. Interestingly, and perhaps appropriately so, the definition of synergy itself refers to agents. Synergy is defined as the phenomenon in which two or more discrete influences or agents acting together create an effect greater than that predicted by knowing only the separate effects of the individual agents.

In a nutshell, the whole is greater than the sum of the individual parts. For this industry's purposes, each individual involved in a mortgage team will benefit more than any one given agent working alone.

If you agree that it is time to build a team, you then have to identify the 'what next?' You must first understand the importance of the required roles and challenges of the mortgage process. The mortgage process can be defined as everything from initial client contact and lead generation right through to post-closing marketing.

In this industry, the mortgage process really is the product. The product is the result of a series of steps and processes ultimately leading to the end result. This is where I find it useful to use an analogy called the 'mortgage factory'.

Like any factory, there are distinct departments and divisions that must work together to produce the end product. In the mortgage factory, there are three distinctly separate and unique departments: lead generation, processing and follow-up.

Lead generation

Lead generation includes everything and anything you can imagine to bring clients through the door, and the sole purpose of this department is to attract clients by any means necessary.

The day-to-day focus of a team member in this department can include meeting with referral sources such as realtors or financial planners, advertising in the paper or producing a radio spot, developing a marketing website, organising a mailer, joining a breakfast club, presenting public information seminars, following up, and phoning hot prospects.

The core competency of this department is simple: get more clients.

Perhaps one of the most important functions of this department is evaluating the return on investment (ROI). Many agents ignore this key step altogether because they are relatively busy in their day-to-day operations and feel that what they are currently doing is working 'well enough'.

But if you really want to grow your business, it is critical to measure where your leads are coming from and understand what is working for you. Your investment is more than money - it is your time too.

If you sat down and honestly analysed the sources of most of your business, you would undoubtedly be surprised. The information you gather can be very powerful and will enable you to adapt your future efforts, resulting in an even higher ROI.

If you examined the lead generation department in any successful mortgage factory, you would find one thing in common: investment of time and money is always focused on endeavours that are highly effective, and any efforts with minimal return are quickly eliminated.

Processing

The processing department is a skilled sector focusing on deal placement. Once an application is received, it is this department's job to evaluate each client's potential, analyse their specific needs and then select the best lender and product for that client according to those needs.

Properly underwriting a deal means knowing in advance how to structure a deal, which documents to request and gather, and how to relay the information efficiently in a way that is most favourable for the lender involved.

This department must be organised and is always under pressure, with specific dates and deadlines playing a big part of the daily grind. The core competency of this department is knowing how, where and when to properly get a deal placed.

If this department is to succeed in the long term, there are two key fundamentals it must embrace: relationship building and continuing education.

Maintaining strong working relationships with underwriters is vital to getting deals processed efficiently. If you can develop a good understanding of how a person likes things done and can get in a good daily rhythm, your productivity will increase tenfold.

A big part of this process is maintaining a strong understanding of the products. This is where continuing education comes in. In all likelihood, most agents will only deal with four or five top lenders, so it stands to reason that agents can become experts on these lenders' product catalogues.

Keeping up to speed on current market conditions and product offerings will not only increase your efficiency, but will also ensure that your clients are given the best possible options.

Follow-up

This department is all about client satisfaction. If we expect a client to refer us, we have to ensure that they have a favourable experience. And, if they do not, the follow-up department needs to identify why and take steps to ensure future satisfaction.

The first step is a thank you card or letter and a phone call a few weeks later to answer any lingering questions, offer any further assistance and ask for any constructive criticism the client might have. This will pave the road for future mailings and contact, which is really what the follow-up department does best.

Asking for referral business should always be the central focus for this department. A comprehensive post-closing marketing campaign is paramount to success and will ensure a steady flow of future referrals and repeat business. The core competency of this department is making sure clients are happy and turning them into loyal, referring clients for life.

Bringing it together

I often share the analogy of the mortgage factory with my agents and pose the question: 'Which department is the most important to the success of the factory?' Suppose you had to make some layoffs. Which department would you weaken or let go first?

The answers are often varied and elaborate, to say the least. Some argue that without a successful lead generation department, you would have no business to process at all, so the lead generation department is clearly number one.

Others point to the fact that you could have dozens of leads, but if you do not know where to send them or cannot get along with the lenders, then you are dead in the water.

Although a less popular answer, some cite the follow-up department as being the key to success. They insist that if you can build a loyal client base and reach a critical mass, then follow-up will grow the book of business effortlessly from the inside out.

The truth is, in order to grow your business and reach the next level, you will need to excel in all three departments. Once you become busy enough, one individual simply cannot effectively work in all three departments.

This brings us back full circle to teamwork. If you want to grow your business, you will need to build a strong team and establish a division of labour.

If your initial team is comprised of just two individuals, one should head up the lead generation department, one the processing department and both should pitch in on the follow-up department.

My ideal dream team includes a strong personality in the lead generation department, two or three skilled people in the processing department and one person with an attention to detail handling the follow-up.

Realistically, it really does not matter how you choose to build your team or how many team members you ultimately decide to have. The bottom line is: there is strength in numbers. If you take a synergistic approach to the mortgage business and empower individuals to work in the areas for which they are best suited, you all win.

If you study the most successful people in the industry, you will find one common denominator: they all have built teams around them and run an efficient, high-producing mortgage factory.

Gordon Ross is a managing partner of Axiom Mortgage Partners (www.axiommortgage.ca)