Two industry associations have highlighted the common mistakes that new-to-industry mortgage brokers make when attempting to establish themselves.
Speaking to The Adviser, MFAA business development manager Zarko Jokic emphasised that when it comes to broking, from the outside it can often look a lot easier than it is.
He highlighted that in fact being successful in the industry takes a lot of hard work, and one of the biggest mistakes that new brokers make is having unrealistic expectations in the first year.
“They think, well I’ve gone from earning X amount of money, and now I’m earning a fraction of that but I’m working twice as hard,” Mr Jokic said. “That can kill your enthusiasm, and take all of the oxygen out of the business and you stop working as hard as you do.”
“I also think that sometimes people take the easy way out and don’t put in the hard yards early on to build a solid foundation in terms of their lender relationships and making sure that they do know what they need to know about the various lenders on their panel,” Mr Jokic elaborated.
Self-management is also a “killer”, according to Mr Jokic. He explained that people often talk about time management but it is important to remember that it is not possible to manage time.
“It doesn’t matter how good you are, you still get 24 hours in a day. The only thing you can manage is yourself and what you do with that time. It’s more will over skill,” he said.
Further, Mr Jokic said that one of the biggest mistakes he sees new brokers make is not working hard enough to become proficient in marketing.
“Generating leads is where it begins and ends. If you’ve got no one to talk to, you can have all the product knowledge in the world but you’re talking to yourself. You’ve got to have people who are engaging with you,” he said. “Marketing creates customers and customers create sales. But people aren’t prepared for how much work it takes to generate leads and how much marketing requires.”
Mr Jokic pointed out that there are plenty of resources that new brokers can draw on for additional support to improve their marketing, namely their aggregators and industry associations.
“Aggregators provide great resources to allow people to maximise their marketing scope. The great thing about our industry is that it is very collegial; people are willing to share their experience so that you don’t have to repeat their mistakes,” he said.
The FBAA’s Peter White agreed that learning how to generate leads is critical when starting out in the industry and is often a challenge that faces new brokers.
“It’s all well and good to come to the industry but somehow you’ve got to get leads and convert those into loans,” he said. “Anybody coming into the industry needs to have a well-sounded business plan, and an understanding of how it is that they’re actually going to generate business.”
“Are you going to do your own sort of marketing through digital media, do you have a social group or a community group that you can network through? If you don’t have a means to generate business you don’t have a business,” Mr White concluded.