Shift your client’s ideas about what you do to earn even more commissions, says one broker.
Mortgage broker Michael Yasny with Verico
Cashin Mortgages suggests brokers shift client expectations and positioning themselves as more than just mortgage experts.
“When you earn your income by commission you need to think outside the box so that you can separate yourself from everyone else in your business,” Yasny told MortgageBrokerNews.ca.
Thinking outside the box, according to Yasny, includes positioning yourself as a “money” broker instead of a mortgage broker; develop relationships with clients through the handling of various financial solutions instead of just mortgages.
Many may argue this requires a large lump sum for start-up costs for establishing ancillary offerings – such as diversifying your business by offering insurance sales and banking products – by Yasny says this can be done through referrals and a little bit of creativity.
“Here is a perfect example of how a money broker earns a commission and a mortgage agent loses a commission – and maybe a client,” Yasny said.
“Your client owns a manufacturing business and needs a new machine that costs $150,000. After finding the machine the client applies for a $150,000 lease,” Yasny said. “The leasing company’s credit department turns down the lease.”
That client then approaches a broker for a second mortgage, which may fall short of the required funds needed for the equipment.
“After the appraisal on the house is done you have to inform your client that the equity in the home will only allow you to arrange a $50,000 second mortgage; here is a solution a money broker would have for this deal,” Yasny said. “With the $50,000 available you contact the leasing company and ask them if they would now consider a $100,000 lease because the client now has $50,000 to put down on the equipment.”
If the proposal is accepted, the broker will then have convinced his client he is more than just a mortgage expert – he is a money expert, according to Yasny. And that client will be more likely to look to him for future business; including, but not limited to, mortgages.