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Some of the country’s top finance brokers have warned new entrants to ensure they ‘don’t go it alone’ when starting out in the industry, as the current market can be very challenging to succeed in.
Speaking to The Adviser in the new Elite Broker podcast series, some of Australia’s top brokers suggested that forging relationships with others and having a mentor is the best path to success for new brokers.
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Todd Hunter, founder of Sydney-based buyer’s agent and mortgage broking company wHeregroup, explained: “It’s a lot tougher now with the regulations you have to go through [so] you would have to have some sort of unique prospect; just being a mortgage broker probably isn’t enough. You probably need to have some other avenue where you might have a buyer’s agent, or a property arm, or financial planning arm, to bring in the clientele.”
George Samios of MADD Loans added that good referral partnerships are also fundamental to moving business forward.
He said: “[New mortgage brokers] need to go make relationships with a proactive accountant who does the right thing for their clients, a proactive financial planner, a proactive lawyer. And these people need to be long-term people.”
He explained: “The accountant you refer your clients to needs to be a long-term accountant to your clients who is going to try and get your clients to the next level, buying a different property. The financial planner will make sure that they're contributing enough to their super so that they can retire properly. The lawyer can be there for wills, estate planning, conveyancing, whatever.
“You refer your clients to these people who you trust and they will refer their clients because they trust you as well. They will look after the clients.”
Mr Samios added that he did not believe there were financial benefits in paying for referrals, and added that it can “look unethical”.
“It looks weird to your clients if you refer someone for a financial benefit”, he added. “You're not going to resonate properly.”
wHeregroup’s Mr Hunter told The Adviser that having a “really good mentor” is also crucial for new brokers, as they can “give you the tricks of the trade to shortcut everything, instead of having to learn from all your mistakes you can go be successful from the start”.
Melbourne-based broker Matt Mannaert, who wrote $85 million in 205 deals last year with the help of a credit adviser, agreed that mentors were vital to success, stating: “When you first join in, I'd say join in with a group, get a great mentor.
“Having a really good mentor in the first two years guiding you through the pitfalls and helping you with any sort of issues that you come across [can really help]. I was coming in straight off the end of the GFC. A lot of changes were happening, but I didn't know any better. Having a mentor that could guide you through all the different parts of it really helped out.”
‘It’s too hard in this industry nowadays’
While Mr Mannaert highlighted it “goes without saying” that new brokers need to constantly learn and upskill, he warned they should make sure they “don't go it alone”.
He explained: “I think it's too hard in this industry nowadays... You need to be aware of too many things, there's too much compliance. We have staff that just look after compliance for us, we’ve got an accounts person, we've got people that just look after the marketing for us. Trying to be everything as a one man band, is very, very difficult nowadays to really succeed. I'm not saying it can't be done, but it would potentially take you a lot longer to succeed.”
He added that having a “great aggregator” is also important, as they can help out in times of need and provide efficient CRMs, which can help with client relations by providing reminders for client birthdays, for example.
Both he and Mr Hunter added that a good work ethic is also critical in the first stages of broking, because there is often “no such thing as nine to five” working days in the first year of starting out.
Mr Mannaert said: “Anyone who goes into the broking industry, know it's [going to be] lumpy. It's not always going to be smooth or anything like that. You know that sometimes you're going to have to put in the big hours. If you really want to get to that next level, you need to do that.”
Andrew Algie from Addisons Advisory Group added, however, that although new brokers do need to put in a lot of hard graft, it pays off in the end.
He commented: “If you're prepared to do the hard yards and you've got the end goal in sight… you just enjoy the journey, because it's a pretty cool journey.”
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[Related: Switching aggregators is a ‘painful’ process, says top broker]
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