Mortgage Brokers - What is your process?

Discussion in 'Property Finance' started by Investig8, 15th Feb, 2016.

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  1. Investig8

    Investig8 Well-Known Member

    19th Jun, 2015
    Central Coast
    The reason for yet another Mortgage Broker thread was simple, are we able to create a thread which can help prospective clients find the right mortgage broker and in turn can we help mortgage brokers deter (to a certain degree) time wasting tire kickers.

    I've recently had another mortgage broker recommended to me and whilst I feel our personalities were a match my requirement or basic need for simple customer service or feedback was let down by a 7 day response time for no other reason than this was the way he did things, IMHO. No feedback is sometimes not good feedback and a simple "I understand, I'll look into it" can buy you a week or two in my world.

    You title search PC for "mortgage broker" (as any regular forum goer or newbie should do first before asking questions) and as of writing this their are 14 results, by far a couple of stand out @moyjos "How to find a good Mortgage Broker?" which took a scan of the first 18 or so posts before I saw the first real recommendation, a lot of the usual banter as we love that here but it in this case wastes the time of both the people we are trying to help and the brokers who are trying their best to serve.

    But still the question wasn't really answered.

    Then I found @MsAli great thread "Building the RIGHT team around you is fuel for your portfolio!!!!", seriously, it's a great read and well worth anyones times if they are interested in property investing.

    The problem with finding this incredible read was because it was hidden inside the 'General Property Chat' area. @MsAli points out (from her perspective and experience) "10" clear statements to ask your self and that of your prospective broker.

    In the same spirit where @MsAli put herself on the line and gave an education in 1 post better than most weekend seminars, I was wondering could we achieve the same thing here.

    As a Mortgage Broker (and yes I know, we have at least 20 of the best in Australia right here, because I have read all the goto recommendations and opened their profiles to scan their last 100 or so posts), are you able spill the beans on your process for dealing with clients and what you want to see more of? Profiling/personality matching is something that I believe will benefit both parties, and to be honest I don't want to email or PM all of you, we are all too busy for that.

    Every broker I've ever seen profiles their clients anyway with their customised forms which we all fill out time and time again before things get started.

    It's the Pre-Qualifier ...

    I do want to know you a little bit and since you pay for a Premium service here I feel it's another way of putting who you are, what you like and dislike in a client, if your a 24/7 shop (God, I hope not - go have some resemblance of a life, please I beg you as you need to be around for a lot longer than the next deal) or simply business hours with a 24-48hr turnaround in communication. What is your preferred communication, strictly email, or is it SMS or perhaps a phone call. Do you have set holidays and if so are they no-go times or do you have a system/competent team in place to still deliver the same level of customer service regardless of where you are and what your doing.

    Do you actually believe in customer service like it matters anymore? (this I know might surprise some people, as it IMHO it's a rare commodity)

    Are you a specialist, one lender preferred (and willing to say it) or do you actually present a plan as a part of your process in best alignment with the clients end goals with all the available options.

    Are you the type to think outside of the box (I have met a few who say yes, but hit many brick walls) and don't know what to do next, do you subscribe to a bit of banter and the occasional profanity, because in this business I reckon you should (when dealing with finance institutions all day) or does that not work for you (which is totally cool, strange and exotic, but cool all the same).

    I personally don't care if you have 50 IPs or 1 IP, I also don't care about your nett wealth as to me it's irrelevant for what I'm trying to get at here, do have you the experience to take clients from their first property to their last, regardless of the number.

    Are you a big picture personality or more conservative (for whatever reason - it's cool).
    Do you regularly assist with risker proposals (high LVRs with tricky LMI) or love to play with every client within the 80/20 or less. I ask this as I believe matching risk profiles or at least an understanding of one's risk profile is essential to a long term relationship between both parties.

    There's no judgement here, I (and I'm sure many others) would like to know as much upfront so we don't waste each others time. Is that a reasonable request? we'll see.

    I'm also not looking for recommendations from the awesome PC community at large unless you can put "how" they best serve on the line.

    This will also give the newer MB's who are not in the usual 4-5 mix of great recommendations a chance present who they are and what they are about.

    I'm also NOT interested in comments (as they don't serve in the spirit of this post) just go to a bank and cut out the middle man, I understand the mindset for it however, it does not serve the MB's who are working tirelessly to serve or the investor searching for their MB soulmate.

    Lastly, can you pull it off in just one post? (edit it as much and for as long as you like as I'm sure this forum will be around for some time)

    ~Enjoy, and Thank you all in advance!
    Mac Fields, teetotal and TaylorChang like this.
  2. TaylorChang

    TaylorChang Well-Known Member

    2nd Jul, 2015
    My process as a mortgage broker as follow.

    1) Understand the client "need" and "want"
    eg, buying a property, refinancing, upgrading, development....etc

    Personally, I don't really think have a long term ( 5-10 years plan) in term of which bank(s) to use is necessary and feasible. It is because the lending policy is changing almost every week.
    However, have a short term 1-2 year big picture lending plan is vital to success to help client and the lending documentation preparation process.

    2) Understand the client's financial situation
    eg, knowing the client(s) is self-employed, PAYG, Casual, income/debt/asset/liability level.

    3) Research bank(s)/lender(s) if the client's "want" is able to achieve
    eg, 20,000pa total income per year buying property with $1 million is unlikely to be achieve.

    4) Explain the reason to the client his/her "want" can or can't achieve.

    5) Help client to achieve their basic "need" and collect documents
    eg, explain the client to they can achieve with their current situation or home to do some adjustment to achieve their "need" and "want"

    6) Draft up a plan and lending solution for client, then get the consent from the client to go ahead

    7) Start to negotiate with bank/lender in terms of policy, approval, and rate

    8) Keep client(s) updated

    9) Loan approval, follow up, finalisng all the paper work.

    10) Review the client(s) situation after 1-2 year or whenever the client needs

    Building up a property portfolio is more about mindset and commitment than simple YES/NO to the loan to client. Hence, sharing some person experience ( strictly not financial advice) in buying/selling/leasing/renovating...etc, will help client(s) to grow and success in the property investing journey.

    I love to see people's feedback and how other broker's approach
  3. charpj

    charpj Well-Known Member

    21st Sep, 2015
    Process from meeting to settlement - with a handmade image :)

    elow is a progress chart on the 8 Steps from Enquiry to Settlement[​IMG]

    Step 1 – Enquiry

    Client contacts Mortgage Broker to engage in services. After the return of a filled out fact find and supporting documents, Mortgage Broker will review information and financial goals, conduct research and make recommendation based on the three most suitable lenders available.

    Time: From receiving fact find to sourcing funding options – 1 – 2 working days

    Step 2 – Recommendation

    Mortgage Broker presents the three lender options and explains the benefits and features of the three lenders. Decision is made and application is prepared for client to sign.

    Time: From presentation to application ready to sign – 1 -2 working day

    Step 3 – Documents Submitted

    Signed documents are submitted to lender to assessment

    Time: Within 24 hours from receiving signed application and all supporting documentation

    Step 4 – Conditional Approval

    Receive Conditional Approval from the Bank, this is approval in principal suggesting the bank has approved the application from a credit perspective. A property valuation would be ordered by the bank. The approval may include other conditions that need to be satisfied prior to final approval.

    Time: From submission to response – 3 – 5 working days*

    Step 5 – Final Approval

    Once conditions have been satisfied and a satisfactory valuation has been returned, a formal approval can be issued.

    Time: 2 – 3 working days*

    Step 6 – Loan Documents

    Lender will prepare and issue mortgage documents to the nominated party. Client requires to read, sign and return.

    Time: 5 – 10 working days

    Step 7 – Ready for Settlement

    2 – 3 days after the documents have been received, your solicitor/conveyancer will contact the lender to book settlement.

    For refinances your new lender will liaise with the outgoing lender to complete settlement, this is pending a discharge authority and may take 5 – 10 working days.

    Step 8 – Settlement

    Congratulations, settlement book and titles have been effected with new mortgage.

    * This is a general turnaround timeframe, if specified lender has a longer SLA (Service Level Agreement) – applicant will be notified at submission of documents.

    Please note this is the general process and Construction, SMSF, Family Guarantee Loans require additional steps.

    TaylorChang likes this.
  4. Marty McDonald

    Marty McDonald Mortgage broker Business Member

    22nd Jun, 2015
    Sydney North Shore and Norther beaches
    I find a phone call upfront works best to build rapport, feel each other out see if we hit it off etc and to fact find the current position / reason for the inquiry. Discuss any potential road blocks as I see them.

    Then I would say leave it with me and I'll call / email you back later that day or tomorrow once I've done an initial ball park assessment on servicing based on the info I've been given. Sometimes if self employed or very complex I would ask for some key documents upfront to see if the "deal" is likely to work or not but I wouldn't ask for the whole box and dice.

    The plan of attack and relationship develops from there in no particular order. I don't like being shoved into a system by service providers and I appreciate everyone wants to work differently so I try to accommodate where I can. Not business 101 but I'm not trying to take over the world either!
    teetotal and TaylorChang like this.
  5. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

    18th Jun, 2015
    Perth WA
    The process of any mortgage broker is going to look like what's above.

    The process isn't what defines you as a broker, it's everything else. Here's a summary of what I imagine people actually want to know.
    • How quickly do you get back to clients? ASAP, always within the day.
    • Preferred method of communication? Email, it's handy having a record of all communication. Text is the worst and if anything gets missed/forgotten it will be a text message.
    • Do you freak out easily under pressure? No.
    • If there's a problem, will you let me know? Yes - with a solution.
    • Can I contact you after hours? Yes. But after 8pm WA time you'll get a call back in the morning.
    • Will you answer the phone on the weekend? Depend if I'm near my phone or not. But you'll always get a call back asap.
    • Will you meet me at my home? Sorry, no - but I'm happy for you to come to me. It's not an efficient use of my time to travel to clients.
    • Are you flexible to my needs or do you only deal with 'x'? I work primarily with investors, but also do a bit with FHB and upgraders. My investors are my favourite though, I love seeing what they're all up to! :)
    • Residential only, or commercial as well? Mainly resi at the moment, but happy to look at commercial too.
    • Do you just write loans or will you assess my situation and advise on areas I can change or tweak to increase my wealth? I assess all my clients circumstances within the big picture, it's never just a 'write a loan and catch ya later' scenario with me. I always look for ways to increase the efficiency of my clients situation, whether it's setting up loans to enable a debt recycling strategy, the best way to create your next deposit, negotiating better pricing, restructuring existing loans for maximum flexibility and risk reduction, advising on the most effective use of offsets and so on.
    • Are you nice to your clients? Always :)
    • Do you like it when they send you wine? Yes.
    Last edited: 15th Feb, 2016
  6. Marty McDonald

    Marty McDonald Mortgage broker Business Member

    22nd Jun, 2015
    Sydney North Shore and Norther beaches
    I think me and Jess are on the same page here but I do travel within reason.
    Jess Peletier likes this.
  7. Terry_w

    Terry_w Structuring Lawyer and Finance Broker - all states Business Member

    18th Jun, 2015
    My method is different because I am licenced to give structuring advice, from a legal, taxation and credit perspective.

    I think this is the most important area to focus on because the wrong structure will hold you back by costing money and by reducing borrowing capacity

    By 'structure' I mean
    = how to legally own property,
    = how to beneficially own property,
    = how the loans are set up - what names,
    = how deposits are funded
    = how to set things up for debt recycling
    = tax efficiency

    Getting the loan done is the easy part. But setting it all up before hand is the hard part but it is the most important.
  8. Investig8

    Investig8 Well-Known Member

    19th Jun, 2015
    Central Coast
    This is exactly what I was aiming for, it's heading in a great direction without detours.

    All I can say about @Terry_w without crawling too far up his backside is fairly simple, bookmark his profile and go read his Tips series, it's worth every bit of your time and a whole lot more.

    Sincere thanks for rolling with it, I'm sure many will benefit on both sides of the fence as it grows.

    I understand the layout of how the loan is obtained is part of the process and will be very similar in most cases.

    The following is what I was truly aiming for, some personality, the service with a smile or a frown, the type of customer service throughout the process, people who will hopefully "under promise" and "over deliver"
    After the statement "It's the Pre-Qualifier ..." in the OP, the next 6 paragraphs are fairly specific to what I was aiming for if your unsure.

    Looking forward to seeing some more personalities contribute.
    TaylorChang likes this.
  9. tobe

    tobe Well-Known Member

    18th Jun, 2015
    Chat on the phone, answer any questions they might have, make a time to catch up, my office their home or workplace.

    I'm not a business member here. I'm here primarily for my own education.
    TaylorChang, Redwood and York like this.
  10. Mac Fields

    Mac Fields Well-Known Member

    4th Jul, 2015
    Great thread and thanks for a detailed set of questions.

    Good to see more contributions to understand how brokers think :)