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This puts brokers in an unhelpful position where they are perceived as magicians who can always negotiate a discount, creating a stressful and unsustainable business model.
The reality is, a rock-bottom rate is only one piece of the puzzle, and although client acquisition can be far more exciting than retention, keeping repeat customers is the key to a sustainable brokerage.
The secret lies not in an audacious sales pitch, but in an unwavering commitment to excellent customer service and operational excellence powered by smart technology.
For mortgage originators focused on building a solid, referral-driven business, it’s time to rethink what it means to be a modern broker. It’s about moving beyond transactions to deliver an effortless edge.
The problem with transactional broking
The traditional brokerage model of churn and burn is driven by constantly focusing on new business rather than developing long-term relationships. Although the media constantly focuses on it, brokers know the rate is a tiny part of delivering the best outcome, but the fear of commission clawbacks often prevents them from reconnecting with current clients.
This set-and-forget mentality leaves customers feeling underserved and erodes loyalty, damaging a business by making it a constant grind of marketing and lead generation.
Industry retention rates hover at about 70 per cent, and the key to building a successful brokerage (and a higher retention rate) is to view every client as a long-term partner and invest in systems that make that partnership a reality.
It comes down to having a proactive, customer-first service philosophy at the heart of the business, with technology serving as a tool that makes it possible. A key is to start with a clear vision – how can you make the mortgage process less stressful, more human, and more genuinely supportive?
A common client stressor is delayed communications, where customers feel they have disappeared into a void. Brokers who let documents pile up exacerbate the problem, and to counter this, you need to specify a goal for how long it takes for pre-approval turnaround, then implement technology to ensure no document is asked for twice, while managing all your client applications and communications digitally.
This approach eliminates frustrating back-and-forth communication, making the process smoother for everyone. Then you’ll need a robust CRM system and a fully paperless workflow to help you deliver on your promises. A good CRM system will help track client milestones and anticipate future needs, allowing you to review loans, uncover new savings, and ensure financial set-ups remain aligned with the clients’ goals.
Going beyond the loan
Contrary to popular belief, a client’s journey doesn’t end when the loan settles. It is a far more sustainable practice to have a proactive approach that shifts the focus from a one-time transaction to consistent, ongoing support.
If more brokers implemented a proactive approach with a thorough financial health check for all clients at around the 18-month mark, and they implemented efficient systems for communications, this would shift the industry perception from dealmakers to proactive service providers.
Building a system for success starts with a mindset shift from a transactional to a relational model:
- Start with the end in mind: Instead of just focusing on getting a loan approved, a broker should ask, “What would a perfect long-term client journey look like?” The aim is to be a trusted adviser, not just a service provider.
- Invest in the right technology: A CRM should be a central hub for all client interactions and future-oriented actions. A paperless workflow is not only secure and efficient, but also provides an accessible, centralised record of every interaction.
- Create a proactive workflow: Define specific touchpoints beyond loan settlement. A non-negotiable part of the service should be an 18-month financial health check. This approach allows brokers to uncover new opportunities for clients, such as property portfolio growth or debt consolidation.
- Embrace cultural buy-in: This approach requires the entire team to be on board. Training and a strong company culture that prioritises client relationships over quick wins are crucial. When every team member understands the value of proactive support, it becomes an embedded part of the service.
The set-and-forget mentality is a relic of the past, a risk mortgage brokers can no longer afford to take. If the industry wants to continue improving, it requires a strategic, proactive model that transforms brokerages from treading a transactional grind into sustainable, profitable, and respectable businesses.
This isn’t just about winning new clients – it’s about proving your value long after the initial deal is done. When you blend high-touch service with high-tech efficiency, you create an unparalleled level of client loyalty and set a new benchmark for what mortgage broking can and should be.
Saurabh Arora is the strategic wealth partner at True Capital.