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The rise of female brokers

The rise of female brokers

Sarah Thomson, Loan Market Sarah Thomson, Loan Market
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In this episode of Elite Broker, The Adviser team talk to Geelong-based Loan Market broker Sarah Thomson about her 18 years of broking, how the industry has changed over time, and the role of women in the industry.


Tune in to find out why she decided to become a broker, her thoughts on mortgage stress, the reasons for going P&I instead of interest-only, and what she would advise her younger self if she were starting out again.

 

Find out how she:

  • Balances home and work life
  • Mentors her team
  • Manages client expectations

 

And plenty more!

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Full transcript

 

Speaker 1: Welcome to the Elite Broker podcast. This is your host, Annie Kane.

Annie Kane: Hello everyone and thank you for tuning in to The Adviser's Elite Broker podcast, I'm Annie Kane, editor of The Adviser and I'm joined by James Mitchell, manager of mortgages at Momentum, as well as Sarah Thomson, senior finance broker for Loan Market in Geelong. How're you doing, Sarah?

Sarah Thomson: Very well, thank you. Thank you for having me.

Annie Kane: Good to have you in here and speaking to us. The reason why we've got you in, obviously, is you came on to our radar when you were a nominee for the Better Business Awards for regional broker of the year this year. We've since obviously heard great things about you, so I just wanted to have you come in, talk about how you got to where you are today and how you first started broking. We were speaking and you were saying that you've been broking for about 18 years, so, obviously you've gone right through the GFC into today's market. How did you first start, though?

Sarah Thomson: I started with another company, actually. More employed by them to sign up loan documents and guide people through the process of refinancing at that stage and I realised that I love the interaction with clients more than anything. That was where my forte was, was dealing with people. So, I decided to go out on my own. That would've been 15 years ago, 14 years ago? And one of the biggest reasons for me, back then, was there was no such thing as maternity leave and I looked at broking as a channel for me to be in control of my income and to have to my entire income looking after clients and also be able to take that time off with children too, and have a bit of flexibility. I don't know if that worked very well but, yeah, just to be able to run a business and have a family at the same time, with some income behind me, too.

James Mitchell: Yeah, definitely. I mean, from some of the brokers we've spoken to who have been in the industry for a while and maybe were in banking and left, I think that was their reasoning as well. They wanted to just have a bit more control over their time, you know? Because various life stages and that sort of stuff. How do you find the balance now, in terms of your working life and your time outside of broking? Is it ... I'm really interesting in the sort of ... How people manage their time.

Sarah Thomson: For me, now, it's very different. I did the hard yards initially, where I was working a lot of hours, trying to balance the two and for me, having a home based business for me, and children, it didn't work for me, in the sense that something had to give. It was either the children that were giving or my clients that were giving and someone was losing out. So, I made the decision to move my business to an office so that I could separate the two and after doing that, I found, probably the last couple of years is probably where we've hit our straps in the sense of having a lot of structure. I don't go and see clients in their homes anymore, they come to see me at the office, so it means I've got more time. I can control the appointments as well, so, it means if I need to leave by five, I leave by five. If I need to be home at a certain time ... I'll still do some appointments after hours, but again, it's generally controlled by us on when those clients come to see us.

                And I think it's one of those things in the industry where I always say the brokers that are travelling and doing long appointments and night times, which you do have to do, I think, at the start a lot of times ... But I think that clients will leave work to go and see their accountant or get their legs waxed or see a hairdresser or do all of those things. Well, we're professional brokers, we're great at what we do ... And not to be arrogant about it, but they can come and see us, you know? We're specialists in what we do, so, I think it's really important.

James Mitchell: Yeah, very good point.

Annie Kane: And we definitely have that sort of divide. I think some of the brokers we speak to are like, "Oh, no. I would definitely go and see my clients in their home." And others are like, "Well, actually, if you have someone come into your office, they're committing to you. You weed out some of the tire-kickers that way, because you know they're already making the effort to come and see you at an office." But I just wondered, in terms of the change in broking over the years ... I mean, obviously now, we're increasingly seeing regulation and changes and much more accountability in terms of when you're putting a loan in you have to have all this documentation-

James Mitchell: More compliance.

Annie Kane: And reasons, exactly, for doing it. I just wonder, what was it like broking then and what's the main difference between then and now?

Sarah Thomson: Definitely the compliance.

Annie Kane: Yeah?

Sarah Thomson: But I think getting on board with compliance and changes in the industry really quickly mean that you can move on. So, don't fight it. There's no point fighting it a lot of the time. Change is inevitable with these sort of things. So, I think we've sort of grabbed it at the start and then one or two years later you might find that people are still saying, "Oh, this compliance stuff." It's like, well, it's been here for three years, so let's move on. Let's just write deals and look after our clients. So, yeah, I think you can fight some things, but other things you've just got to go with.

Annie Kane: And in terms of your client base, so, when you're out down in Geelong, Victoria ...

Sarah Thomson: Yeah.

Annie Kane: Am I pronouncing that correctly? I'm always ...

James Mitchell: Yeah, Geelong.

Sarah Thomson: Think the Geelong Cats. They're our football team.

Annie Kane: I'm always a bit frightened-

James Mitchell: It's not gee-long.

Sarah Thomson: Or gi-long.

James Mitchell: It's Geelong.

Annie Kane: Yeah, good, good.

                Are they mainly residential or have you got commercial, what's your mix of clients?

Sarah Thomson: Mainly residential. We do a little bit of commercial business, asset finance.

Annie Kane: Okay.

Sarah Thomson: We've got Wealth Market on board as well, which is financial planning as well. So, really that, the holistic ... Clients from the start right to the very end, but a long term relationship for us with them.

James Mitchell: That's cool.

Sarah Thomson: Geelong is probably ... It's been a very blue collar town for many years but now there's been the closing of a lot of the manufacturing plants. Shell and Ford and things like that. Alcoa. So, now we've got a lot of white collar workers coming to Geelong and a lot of Melbourne buyers are also coming to the area, realising that it's only 50 minutes away and prices are probably half the price, so you can get beautiful homes in Geelong for what you'd get an apartment for in Melbourne.

Annie Kane: Wow, yeah.

Sarah Thomson: And lifestyle, great schools, near the beach. Do you want me to sell it more?

Annie Kane: Where do I sign?

James Mitchell: So, are you getting that migration?

Sarah Thomson: Absolutely. At the moment, yeah, Melbourne buyers are pushing our prices up now in Geelong, which is making it harder for the first home buyers, but we've got a lot of first home buyers now. They've got the regional grant, $20,000 and it makes sense for a lot of them to be building at this stage.

James Mitchell: So, the regional grant, that applies to Geelong?

Sarah Thomson: Correct. We are regional.

James Mitchell: Wow.

Sarah Thomson: Even though we're a big city.

James Mitchell: Yeah, yeah.

Sarah Thomson: In the country.

Annie Kane: Yeah, because I did think that when I was like, "Oh, regional." And then I'm like, "Geelong, is that regional?" But I guess because, yeah, it's not right in the centre of Melbourne.

Sarah Thomson: Absolutely, yeah.

Annie Kane: I just wondered as well, you were touching briefly on commercial and asset finance that you also offer and you have the referral partnership for financial planning as well. What kind of asset finance are you seeing and what kind of commercial stuff are you seeing in that area?

Sarah Thomson: A lot of small businesses that are trying to get traction or opening up ... Your fitness places, your cafes, probably the small ... When I say business, probably your 50 to 100, not your high-end.

Annie Kane: Yep.

Sarah Thomson: I think we really focus on dealing with your mom and dads ... Not your mom and dads, but your mom and dads, your clients that ... I suppose we deal with anyone from first home buyers to well-versed investors, but then we get the little people wanting to start their business.

James Mitchell: Yeah, that's really good. In the local community as well? That must be quite good to actually be involved in the journey and then actually walk down the street and see the businesses happening.

Sarah Thomson: Absolutely.

James Mitchell: That must be cool

Sarah Thomson: Yeah.

Annie Kane: And do you do much in your community in terms of actually getting your name out there? How do you set your stall out, really?

Sarah Thomson: Besides our marketing, which is more to do with Google reviews and Facebook, especially locally, we look at things ... We sponsor a lot of events, charity events in Geelong. We're part of Give Where You Live. Give Where You Live's more a foundation that's been set pup so that you've got maybe a hundred different people that are wanting funding for charity and they're the go-to place and they'll decide where those funds are best distributed, instead of just picking one charity. So, yeah, we get involved in those sort of things.

James Mitchell: Nice.

Annie Kane: Yeah.

Sarah Thomson: Which is great.

Annie Kane: Well, we know that you're up for the Women in Finance awards tonight, which will be hosted tonight. So, it's one of your colleagues that's up for an award?

Sarah Thomson: It is, my amazing Jennifer Campbell, who is executive-

Annie Kane: Office administrator for her, yeah.

Sarah Thomson: She's amazing.

Annie Kane: But obviously, just because of that, I just wanted to pick your brain a little bit about, again, because you've been broking for a while, just in terms of how the industry has changed, if at all, in terms of gender equality and have you seen any more women brokers? I imagine at the time, you must've been in the minority for sure.

Sarah Thomson: We've actually got an all-female office. It wasn't intended that way, but I've got another broker, Liz McRae, who's also an amazing broker. She's been in the industry for two years, but banking prior to that, at one of the majors as a branch manager. So, she's been with me for two and a half years and all of our admin staff are also female. So, it wasn't by choice, it just happened that way. There's a ... And I know, even with Loan Market, there's a lot of female brokers that have come on board and that are doing very well. And I think it's that ability for women to be able to build a relationship pretty quickly and the trust element, of course.

                But the changes, I suppose, for us, even in the lending space, has been a lot of people are going online to find us. So, they're wanting peer reviews and that's how we're being found or referrals. So, we don't deal with a lot of real estate agents anymore, we don't deal with a lot of external referrers. Our clients are our referrers, I look at it that way and think, if we look after them and do an amazing job for them, then they're going to refer their friends and family and that's how business has grown for us.

Annie Kane: Yeah. And I think that's always the golden mark, isn't it? People always want to really rely on word of mouth rather than having to pay referrers or, not pay referrers, just have some referrer partnerships.

                And I also want to ask, just quickly, about the types of loans you're seeing in terms of, is it mainly P&I? Is it mainly interest-only? Because there have been so many crackdowns on IO and then having to-

James Mitchell: Investor stuff.

Annie Kane: Really justify exactly for investors. What kind of things are you seeing?

Sarah Thomson: That's been such an interesting thing in our space over the last 18 months. So, a lot of times we talk about strategies for clients, whether they're investors or first time buyers who are wanting to pay interest-only so that they can get in and actually do some work to the property, or keep that extra surplus cash to do something to the property. So, over the last six months we've actually really focused on the P&I space as well as, obviously, everyone else has. And it has just flipped. It's turned on its head, so now it's not even a discussion in a sense that a lot of people are expecting to pay P&I. We talk about, you may as well pay P&I instead of a high interest-only repayment because it's going towards your mortgage instead of directly to the bank.

James Mitchell: Yeah.

Sarah Thomson: Yeah. So, I thought it was going to be really hard but it's actually been really easy. I think it's made a huge impact, which has been great.

James Mitchell: How long have you been with Loan Market?

Sarah Thomson: 11 years.

James Mitchell: Okay.

Sarah Thomson: Yeah.

James Mitchell: Oh, wow. That's a long time. So, they've been around for just over 20 years, I think.

Sarah Thomson: Correct, yeah.

James Mitchell: And it was ... I caught up with Sam White a few weeks back and we were talking about Loan Market's vision, I guess, over the next few years and one thing he mentions, and he mentioned it previously, has been this idea of brokers now being, today, what the branch managers were of the 1970s, where we're sort of like this hub of the community and you'd go and see your branch manager and they'd know your name and they know your family and they know your dog. You go for your loan, but in that sort of sense ... But obviously, banking's changed. Branch managers don't really provide that sort of ... Don't fill that role anymore, but it seems like brokers do. Do you feel that sense as well?

Sarah Thomson: I do, especially for our office. We have a beautiful office for clients to come to, they can contact us at any time, they can get on to us easily. There's a whole support team there to be able to help them and it's not just a mortgage, it's the Wealth Market side of it, so, asset finance, business lending, et cetera. So, I look at it as long term relationship with all of our clients, now, which is great.

                And I think the industry's changed, because it used to be very similar, not so much ... Probably to real estate, where it was, they called that ... Talk about the catch and kill, that mentality of get the client, done deal, excited, see you later. So, for us, now, we're really tapping into our database and keeping our clients close and looking after them and trying to get reduced rates with their existing banks, not necessarily having to re-finance but just ... Really just caring about our clients, yeah.

James Mitchell: It's interesting about the office setting because I've noticed, just over the last say, four, five years that I've been reporting on this space, there's just been this increase in brokers, first of all, having an office rather than being mobile and that sort of stuff. There's far more brokers taking on an office and that sort of stuff, whether they're setting up their business or they're with a branded brokerage, but also the look and feel and ... You know what I mean?

Sarah Thomson: Yeah.

James Mitchell: It's not sort of like, you know, up three levels and next to another building, sort of hidden away. It's very much retail presence, right on the street and-

Sarah Thomson: Much more professionalised.

James Mitchell: Much more professional, nice furnishings, a family-type environment, which I think is just like Sam said, goes to that sort of branch manager of the '70s mentality, where you're welcoming people in.

Sarah Thomson: Absolutely. Yeah. I feel like our office is very much like that, so people will come in and it is nearly like a beautiful lounge room where you come and sit and wait for appointments and just ... Yeah. I think it gives a totally different ...

James Mitchell: It's a different experience, isn't it?

Sarah Thomson: Yeah, absolutely. I now look at it and I think, "Ah." And I know a lot of brokers still have to and do go and see clients and there's nothing wrong with that and I think you need to do the hard yards, sometimes, at the start. For us, it was just ... There's more continuity when clients come to see you. You're not worried about things printing off or the internet not working. It just makes everything a lot more seamless for them.

Annie Kane: Yeah.

Sarah Thomson: And they don't want to come and see me five times, they want to come and see me maybe once or twice and for me to do my job properly. Time is precious, as we all known, so.

James Mitchell: I like the idea about it being an experience. Because when you're going to get your first home, for example-

Sarah Thomson: It's exciting.

James Mitchell: It's exciting and you're seeing your broker, you want to sit down and you're reading a magazine ... You know what I mean?

Sarah Thomson: Yeah.

James Mitchell: And then you speak to your broker and you're going through the process in a nice environment, I think that's really ... I think that's really quite special.

Annie Kane: But on the flip side of that, there's also the convenience factor of having someone coming to see you in your home.

James Mitchell: That's true

Annie Kane: When you're most comfortable

James Mitchell: That's very true, as well.

Sarah Thomson: Absolutely.

Annie Kane: There's also that as well.

Sarah Thomson: Yeah.

Annie Kane: But I also just want to ... You were mentioning briefly, Liz, who'd been with you for a few years. How did you make the decision to bring on someone new, and are you sort of acting as a mentor for her or how does that relationship work?

Sarah Thomson: Initially, it was to assist. We had a lot of leads, a lot of referral partners were referring in and we couldn't service them. And I think that's the biggest thing as a broker for me, is yes, we've got the leads coming in but we want to make sure we can increase our capacity behind the scenes so that we don't let anybody down, referrer partners or clients as well. So, when Liz came on board, she was directly from the bank. She was coming back from maternity leave, so I stole her. She's awesome.

                Mentor, look, with her, she's probably one out of the box, as well. She's pretty special and she sort of hit the ground running. So, she made a leap with Loan Market in her second year. She's writing lots of loans, she's about to do ... Due to have a baby in a couple of days, but I'm sure she'll still be writing the loans from home, now and then.

Annie Kane: Yeah. And would you ever be into mentoring or have you done it in the past?

Sarah Thomson: I look at the staff I've got at the moment, who have the ability to become mentors. So, I suppose, our support staff ... We've got a very open office environment as well, so we talk about deal structure, why we're doing things ... So everyone is sort of learning along the way anyway. So, if I was to take somebody on, it would probably be internally at the moment and then bring more support staff on to then pick up that area of the business, and then I think just moving ... If they want to, that is. But not every PA or CSM, you know, your customer service managers, they don't all want to be brokers. It's not the be all and end all, and they love their jobs and they're awesome at it.

                So, I would definitely mentor somebody if I thought they were the right person coming into the industry.

Annie Kane: Yeah?

Sarah Thomson: Yeah.

Annie Kane: Because I think that's one of the things that's quite hard, is if you're relatively new, trying to pick someone to be your mentor. There are certainly people out there, but on the flip side, obviously, when to make the decision to become one, you need to take some time out. You need to be able to really invest in somebody else, it's quite a commitment. So, I'm just sort of interested to find out when people do it, why are they doing it and stuff like that. But yeah, maybe something that isn't on your line at the moment, maybe in future.

Sarah Thomson: Yeah.

Annie Kane: And finally, just before we run out of time, just sort of wondering if we can take a bit of a step back and look at the market as a whole, and sort of an overview. So, we keep on hearing, you know, there's not just two markets in Australia. Sydney and Melbourne sort of pulling everything up and we had recent ABS figures, again, showing that Sydney, Melbourne and Hobart, I think, pulling up the house prices generally but there's still that huge gap in WA and-

James Mitchell: Up in Darwin, as well.

Annie Kane: Up in Queensland, as well. And I just wondered, some people are sort of suggesting, "Oh, you know, the things that we're seeing now feel very similar to before the GFC." There's a lot more mortgage stresses, a lot more people focusing on mortgage stress and more people focusing on affordability. The government bringing in the housing affordability packages and trying to control things more.

James Mitchell: Yeah, well, the RBA governor said today in a speech, just over an hour ago, he banged on again about the debt to income stuff and was said, that's obviously on his worry list. Particularly when rates start to go back to normal, he would be ... Between the lines, he was basically saying rates are going to start going up at some point.

Annie Kane: Yeah, and I just wondered, is it something that you've seen? Have you seen an increase in either mortgage stress or in people feeling mortgage stress, even if they're not actually ...

Sarah Thomson: We've probably had more ... Whether it be breakdown of relationships over mortgage stress recently, and also consolidations. And you start seeing those trends coming through and you think, "Oh, here we go." Also, I think back to maybe three, four, ten years ago, but even three, four, five years ago, the amount of debt that people have now that they can't actually afford. So, if we do a new servicing calculator for a bank, you're saying to people, "Actually, the debt you have at the moment, we couldn't get you that debt now." And that's really a concern, because if rates go up, I'd be concerned for quite a lot of people.

James Mitchell: Yeah. Well, I mean, this comes back to something which we ... We ran a story today about it and it was about ... Because one of the banks has introduced the LTI as a way of measuring borrowing capacity and that sort of stuff, and, which they do in the UK, but that's relatively new here. I was speaking to an analyst about it and he was saying that, while it's great that all the macro-potential measures and the tightening by the banks and all this sort of stuff that's happened in the last two, three years is good, the mortgages written before that, when the expenses and stuff was a bit more lax and that sort of thing.

Sarah Thomson: Or pre-NCCP.

James Mitchell: Yeah, yeah, exactly. Could be a bit of a problem if rates start to rise, particularly if people have taken equity out of their homes a lot. I mean, that's actually one thing I wanted to ask. I'm sorry, I know we're meant to wrap up.

Annie Kane: Oh, no, I actually had a follow-up question anyway, so.

James Mitchell: Okay, well, it was just about people who own a home and either they're buying an investment property or they want to buy a car, or ... Are there many people who are using their mortgage or using the equity in their house as ... I don't want to say as an ATM, but as a way of releasing some equity to buy things because it's a cheaper rate?

Sarah Thomson: Absolutely, yeah. Whether it be renovations or cars or saving for a future investment, whether that be shares or property. Yeah. A lot of people, so ... And sometimes people won't use it, but it's there as a backup if something does come along. Or, instead of going and getting a personal loan or credits cards.

James Mitchell: Of course.

Sarah Thomson: Just to have that security. And I think it's really ... It ultimately comes down to the client. They're either really good with their money or they're not.

Annie Kane: Yeah.

James Mitchell: Yep.

Sarah Thomson: And sometimes, when we're seeing clients, sometimes you sort of pare it back a bit because you can tell what their spending habits might be like and you know that if you do that loan, even though it's ultimately not up to me to spend it, ultimately, if you do it that they're going to end up coming back to you in a year's time, wanting to increase it again.

James Mitchell: Yeah.

Sarah Thomson: I think it's just being able to talk with your clients and really finding out what their future strategies are, or what their strategy is to either reduce debt or invest again.

Annie Kane: That was the one thing I was going to say, because you were mentioning there about saying you've seen some of these people come in and you actually were saying, "Well, you couldn't have gotten that debt now." How are you managing that? Once you've identified they've got too much debt or they're struggling with the amount they have, how do you then take them out of that to a path of sustainability? I know you've got your referral partnership there with the financial planner, but in terms of actually managing customer expectations, do you actually address it at all, or do you just sort of ...

Sarah Thomson: Absolutely, yeah. I don't want them coming back in another six months and saying, "We can't afford what we've got." Or it's actually hit them without us telling them. So, we're very honest with our relationships with our clients and I think that's why they love dealing with us too, is because if they are overspending we'll let them know they're overspending. And on the ... Not rare occasion, but some clients we'll go through ... I hate the word budget, but we'll go through their living expenses and see where they can pare things back. I think also, though, for clients, they also need to be responsible ... Even though the banks used to be able to hand out money willy-nilly and we'd give them a credit card if they can't afford it, I think, you know, you can blame other people for giving you money but ultimately, it's up to you whether you spend it or not. So, there's that bit of responsibility back on clients as well.

James Mitchell: Yeah.

Sarah Thomson: Yeah. Definitely honest with clients and we'll help them through and guide them through the process.

Annie Kane: Okay, and just to sort of round off, if there are any new brokers listening to this, I wonder if you had any advice for either your younger self, like, if you were first starting out, what advice would you give your younger self then to avoiding mistakes?

Sarah Thomson: The biggest thing for me, is call clients back straight away. As quickly as you can, because, obviously with the fast paced life we live in, if somebody doesn't call you back and you're looking for a plumber, you're going to go to the next plumber on Google or the next person that's been referred. You're not going to wait around. And I think it's ... Obviously, with the internet around, it makes it even more pertinent to be able to-

James Mitchell: There's an urgency, isn't there?

Sarah Thomson: Straight back to them. Otherwise, you lose them and occasionally you will, but, if you can get back to them straight away. And also, putting a PIO on earlier. I would've done that a lot earlier than I did.

Annie Kane: To try and take some of that admin off your hands.

Sarah Thomson: Yeah. Just to be able to give yourself more capacity to then see more people, write more business.

James Mitchell: Yeah.

Sarah Thomson: Yeah.

James Mitchell: Nice.

Annie Kane: Well, thank you so much for coming in and sharing your thoughts and best of luck for tonight.

Sarah Thomson: Thanks Annie.

Annie Kane: And yeah, please do stay in touch. For more news about mortgages and features, please do visit www.TheAdviser.com.au and read The Advier magazines monthly. Thanks very much.

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