Charbel Kadib finds out how former Commonwealth Bank and Westpac employee Brook Simpson became a lending specialist at NSW-based Regional Finance Solutions.
How did you make the move from banking to broking?
I’m a career banker. I started in Sydney, in Cabramatta, at the Commonwealth Bank in 1979. I worked in retail banking for a little over 35 years, [from] teller to branch manager to regional management positions, and then finished in Westpac in Coffs Harbour as a home loan lender.
I was a manager in Nambucca Heads, where I live, and bought a house there in the mid-’90s and hung on to that house with a goal to move back into it, which I did about four years ago. I left Westpac in 2015 and became a broker about six months later.
What influenced your decision to leave the banking industry and become a broker?
I’ve always been very customer-centric. When I look after the customer, I really like being able to help them in their environment. When I moved to Westpac, I was inhibited from getting out of the office and seeing customers at the time that suited them. [As a broker,] I’m available 24/7, when and where it’s required, and that’s the most rewarding part of my role — to sit in their lounge room, sit on the beach, sit in their workplace, help the customer out and get away from the politics of the big four.
The micro-management was also a big issue [which influenced my decision to] get out of banking and get into mortgage broking. That was also a challenge. While you’re not micro-managed, you’ve got to be a self-starter, and you’ve got to be self-motivated to keep yourself going. It is a very lonely, isolated role sometimes.
What steps did you take to enter the broking industry, and what were some of the challenges you faced when you first started?
We had to get our Certificate IV [in Finance and Mortgage Broking], and a lot of it was recognition of prior learning. So, I did know a lot of stuff already [because] I had been doing it for many years through the training with the major banks.
It was setting myself up with marketing, advertising, setting up referral sources and getting visibility in the marketplace that was the biggest challenge, because there are competitors out there. So, getting the opportunity to actually write loans for people, that was the biggest challenge.
Since you began broking, what’s the biggest change you’ve observed?
Probably compliance. [You] have to make sure that the customer fits every requirement and you’re not putting people in over their heads. You’ve got to do the right thing compliance-wise and make sure the customer is worthy of getting a loan and be very thorough in that way.
The biggest challenge is spending time on making sure you’ve got your lending file in order as far as having all of your necessary documents. [It’s] just a matter of making sure you get the customer to sign all the compliance forms and provide the right forms. It’s just a matter of process.
What are your thoughts on the government’s announcement that the banking Royal Commission will be looking into the broking industry?
I think it’s a good thing. It is a little bit scary that there’s a lot of focus on brokers. You always seem to see that they’re talking about looking at what the broker does and playing with our commission, playing with our trail, etc. Because at the end of the day, the broker should be the first port of call, not the last port of call, and that’s been a big change.
I don’t think they’re being unfairly targeted. I think it’s good that they’re looking into the whole [industry] because there are a lot of mistakes out there. Having worked for major[s] for 35 years, the majors do make a lot of mistakes that need to be addressed, and there are probably brokers out there who make a lot of mistakes as well. We’re not being unfairly targeted at all.
In your perspective, what are some differences between broking in metropolitan and broking in regional NSW?
One major difference is the average deal size, because in Coffs Harbour, for example, you can still buy a house for $400,000 to 450,000. In Nambucca Heads, where I live, you can pick up a reasonable property for about $350,000. So, loan sizes are a lot different.
Also, [in the regions], you work and live in the same environment. I drive my vehicle downtown to get my mail and I’ve got my advertising on my vehicle, so people know who I am. That’s different from the [metropolitan areas] where they may jump on a train and go home at night.
We get to see a lot more customers in their place of work or in their home. You do have to chase the customers a lot more, I suppose. You have to have your marketing plans in place and try and drive the business [as] it doesn’t come to you.
We don’t get walk-ins, for example, whereas a lot of places in Sydney probably do because of their shopfront, etc. I’m not going to get someone knock on my door when I’m working from my office at home, so that’s a challenge as well.
How important is it for you to establish ties with your local community?
It’s important to have community ties everywhere you go... in the country, in regional NSW, for sure. [We’re] involved in things like football sponsorships (my colleague sponsors baseball). We just did some fundraising for [Oz Harvest’s] REAP food service in November where we raised approximately $7,000 in funds. That adds to our profile [and allows us to give back] to the community. We may not write any business out of that, but it’s a real feel-good experience.
What kind of loans do you typically write?
First home buyers are a main component of what I do. What I am seeing more lately is debt consolidation, where people want to consolidate fast loans, credit cards, home loans, etc, into one loan to give them back some financial security. I’ve seen a fair bit of that lately and that’s a challenge; trying to try and place them with a lender. These customers [have experienced] financial difficulty over the past few years, and you need to place them with a lender that will look outside the square to put the customer in a better position.
[I also] do the odd construction loan, but we don’t [write] a lot of construction loans at the moment. We do investments, we do the whole gamut of home lending, but debt consolidation is becoming more popular.
How would you assess the regional market at the moment? Has your business been affected by the market slowdown in the capital cities?
It hasn’t really slowed in this area, in the mid-north coast through to the northern rivers, etc. There’s a lot of road works that have been going on here for the last couple of years which are nearing completion. The property prices are still slowly climbing; once a property goes on the market, it’s generally snapped up very quickly. So, we’re still seeing the benefits of that, and it’s not predicted to ease at this rate until probably the end of the year.
We’re still quite busy. The real estate agents are still busy, so it’s all positive.
What can you say about your first two years of broking? How do you find leads?
For me, the volumes are increasing. I had nearly an 80 per cent increase in [volume] in year two and that’s through word of mouth.
I’m also in a pretty good networking group called Business Networking International, which is a group that meets every week and I get 60 per cent of business out of that, through referrals and word of mouth, [and it] is always improving from happy customers. The next 12 months is going to be very good for us.
What do you enjoy doing in your spare time?
Work/life balance is pretty important to me. Living on the coast, I spend a lot of time fishing, going to the beach, spending time with family and friends. I have two grandchildren and they’re very important to me.
I work from home one to two days a week. I work in a real estate office two days a week. And for one or two days a week, depending on demand, I go to our central office in Coffs Harbour. I love camping and I love fishing [and] when you’ve got your office set up as your third bedroom, it’s very easy to get sucked back in if you don’t shut the door.
Working for 35 years with major banks was pretty tough, and it’s definitely a better environment doing what I’m doing now, especially at my age.
I’m 55, so I’ve been in the finance game for a long time, and this is definitely a happy place.
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