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Let’s face it, if you are a mortgage broker and you are not adhering to the new Responsible Lending guidelines then your days as a broker are numbered.
It is quite clear that ASIC are happy to wield the big stick of compliance and cancel licences or prosecute brokers doing the wrong thing, so running a non-compliant business is not an option. The real question though, is what can you do about this additional compliance to make it work in your favour rather than have it weigh you down?
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We all know that the additional obligations are extensive – far more paperwork than we ever had to do before and really, with what benefit to the client? The obligations are supposed to increase visibility and transparency between brokers and clients but in my experience, most clients do not care much about the unwieldy documents and just sign them because they have to.
It’s this obligation on the client that I suggest is worth using to your advantage – as the new regulations come with a benefit, if you are prepared to see it that way – let me explain…
We all operate in a very saturated market and even with the best of client relationships (that our business enjoys as well), there are still a million reasons why a client may end up deciding to go direct to a lender or to another provider. The regulatory documents can assist with this process and increase the conversion rates, if you let it.
Pen to paper is commitment. Filling out forms, signing your name – it all spells commitment in a client’s mind. Having a stack of regulatory documents that need to be signed both at the start (if you are providing Credit Quotes) and along the way (Credit Guide, Credit Proposal) means the client is becoming more committed to you at each step of the process.
I also love blaming the regulations for clients having to put pen to paper for me, knowing of course that each time they do, they are one step more engaged with our service and our business. We normally have great client engagement anyway, but getting action from a client via the signing of a document is a powerful tool.
My advice: Don’t shy away from the regulations. Use them as a tool to assist you in your sales process.
