As published in Scotsman Guide's Residential Edition, January 2011.
Many of today's mortgage brokers and loan originators have survived previous market downturns. They know what it feels like to see business shrink drastically. Those experiencing it for the first time now know how it feels, too.
Either way, if you're still in the game, you likely realize the importance of generating consistent and meaningful income.
No matter what kind of market we face in 2011, following four steps can help you and your business move forward:
Understand your primary market and typical deal flow.
Identify the remaining money sources most likely to service those opportunities.
Be diligent in the daily effort required to grow and improve your transaction flow.
Focus your time on quality transactions that meet the demands of your primary lenders.
That might sound simple, but breaking those steps down further can help brokers and loan originators create a game plan and carry it out.
Before you do anything else, you must understand your primary market and typical deal flow. What's your niche? If you don't know the answer to this, consider the types of transactions you see most often. Beyond that, consider the types of transactions you fund most often.
If you see an abundance of one transaction type but struggle to close those loans, consider the problems you face. Do the borrowers meet the demands of today's lenders? Are you working with the wrong lenders?
In addition, be willing to ask yourself if your business model and daily operations are working for you. There's no point in doing the same thing every day and expecting different results. Rather than continue, should you refocus your deal flow? Would making a change allow you to better serve the type of clients you interact with most often?
Many, if not most, mortgage brokers operate small businesses. In these cases, attempting to be all things to all borrowers often presents insurmountable challenges. By specializing, you can focus on quality transactions.
After you know your primary clientele, you must identify the funding sources most likely to lend to borrowers in that niche. Successful brokers can't afford to have a shortage of borrowers or lenders.
If your current lenders can't fill the loans your borrowers seek, then it's time to look elsewhere. Take advantage of every opportunity you can to meet and secure different lenders. Talk to them and ask specific questions about how they would work with your deal flow.
Strive to line up money regardless of the size of your current client load. After that, design proper marketing materials that will attract the type of borrowers you seek.
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