As an independent mortgage broker, choosing the right lender partners to work with is an essential component of the overall success and growth of your business. It’s important to understand the basics of solidifying these relationships and ensuring their products/services align with the needs of your clients.
We’ve created this guide for our newest broker owners to understand the importance of finding lender partners that are solely focused on helping you and best practices for strengthening these relationships.
What Makes a True Lender Partner?
When searching for lenders to work with as a new broker owner, you need to be asking yourself two major questions — “What makes this lender a true partner for my business?” and “How are they going to help me succeed?”
First and foremost, enlisting in advice from other brokers or asking within the Brokers Are Better Facebook group is a surefire way to get the immediate answers you’ll need. Although, if you want to do the research yourself, there are certain qualities you should be looking for in a true lender partner.
Advocate for Brokers
Once you start looking for lenders you want to work with, it’s important to ask for advice and figure out whether or not they have a positive reputation for being friendly with other brokers. If you’re working with a lender who does not respect you or your business, it’ll only become a waste of time and money on your end.
Do they communicate with you on a regular basis? Have they been answering your phone calls? Are they prioritizing your client’s needs? These are all basic questions you should be asking yourself before signing up with a lender. It’s highly valuable to find a lender who not only serves as a great business partner but keeps you and your clients best interests in mind.
Gives Clients Back to You
As previously mentioned, you want lender partners who are going to help not only your clients but give back to your business as well. When working with lenders that also have a retail division, it’s bad practice for them to solicit your past clients when they are looking to refinance. It’s important to ensure the lender has a broker agreement that agrees to return all business to the broker.
This is why gathering insights from others in the community is so crucial; you’ll be able to hear firsthand experience from others within the industry and figure out which lenders are solely focused on forming healthy relationships with brokers.
A major contributor toward becoming a successful business is learning how to understand the feedback you’re given from clients, partners, customers, etc. Each lender you choose to partner with should always be eager to hear your feedback.
Whether it’s related to an issue you might’ve experienced while working with them or just tips on how to become more productive, they should be welcoming toward what you have to say in order to improve their business altogether. They should be focused on making themselves better to serve more and more brokers just like you.
Eager to Help
The most important aspect you should be looking for in any lender partner is someone who’s always willing to help you succeed. If there’s a certain issue with one of your files, they shouldn’t hesitate to jump right in and take care of the situation.
This all goes right back to not only putting your needs top of mind, but your client’s as well. It’s important to work with lenders who are valuing the trust you’ve established with your clients to help continue strengthening relationships on both ends.
“Stay true to the lenders that care about you and your business, and just do the right thing with your clients. They will be yours for life.” – Sonny Yee, AIME Member
What is Whole-Tail Lending?
Within the mortgage industry, there’s a clear difference between retail and wholesale lenders. Retailers are known as big banks, credit unions or loan insurance agencies that also work within the wholesale mortgage channel. Some of these corporations have a reputation for stealing clients from independent mortgage brokers which is referred to as whole-tail lending.
Notably, not all retail lenders participate in this kind of business tactic. Some wholesale lenders may have retail divisions, but as long as they are committed to being broker-friendly, they are perfectly fine to begin working with. Whole-tailers oftentimes use the wholesale channel as a form of lead generation for their businesses. Their intention is to buy out clients from brokers for as little as 25 basis points or $400 less in closing costs.
It’s simple for whole-tail lenders to buy leads on the open market, but more times than not it’s significantly cheaper for these companies to take clients from our community. Most of these larger corporations aren’t focused on that first loan, they’re thinking about the second, third, and even fourth loans they’re going to be able to obtain from our clients.
As an independent mortgage broker in the wholesale channel, it’s crucial for you to find lender partners who are trustworthy and valuable toward your business. Currently, AIME’s exceptional list of partners consists of some of the top-name and most successful lenders in the industry. They’re all completely focused on putting the needs of not only your business, but your client’s as a top priority.
How Can You Support Your Lender Partners?
Once you begin solidifying these relationships with lenders, it isn’t supposed to be looked at as a one-sided effort. Both parties are responsible for putting the time and dedication into making these partnerships successful for many years to come.
The purpose of working with lenders is to establish how you can both help each other grow within the wholesale mortgage channel and utilize each other’s strengths to guide borrowers toward homeownership. Let’s take a look at some ways you can become a valuable resource for your lender partners.
Loyalty is Key
As you’re navigating your way through the mortgage industry, it’s important to ensure you’re only finding broker-friendly partners and remaining loyal to the ones you’ve decided to work with. This is going to be an essential asset toward strengthening relationships with certain lenders and guaranteeing your clients are in the right hands.
After identifying a core group of good wholesale lenders to work with, have their back just as they have yours. When experiencing slower turn times or inconvenient overlays, remember that they are doing what they have to do to stay in business. If they are true partners, they will work out these inconveniences and come back better than before. This is a great time to try out your number two and three lenders that you may not work with as much, in order to give them time to catch up. Part of the beauty of being a broker is having options.
Just like millions of working class Americans, our lenders have bad days too. Whether it’s issues with turn times or lack of communication, try to remember they’re doing their best to get back on track and best serve your business. Rather than getting angry, try finding another wholesale lender you know is broker-friendly and get their help instead.
The mortgage industry is an ever-changing and fast-paced environment to be working in, so it’s helpful to remember that certain times of the year will be busier than others for lenders. That’s why it’s crucial to be patient and stay loyal to the lenders you’re working with.
Educate Fellow Brokers
A completely free and widely successful tactic for helping your lender partners earn more business is by word of mouth. If you’re sharing positive experiences you’ve had with certain lenders to brokers in the community, it basically serves as free advertising for them and helps strengthen your relationship even further.
It might even be useful to share information about certain lenders you like with your fellow colleagues who have already established their businesses as well. It’s highly valuable to not only be a trustworthy partner but become an asset toward the success of their business.
Altogether, both brokers and lenders are looking to establish long-lasting and profitable partnerships with one another. If you’re focused on finding partners who will be truthful and dedicated to your business, you’re much more likely to succeed and expand your client base. Make an effort to prioritize being educated and never be afraid to ask for advice on which lenders you should be working with within the wholesale mortgage channel.
Join our Brokers Are Better Facebook group to learn more about our lender partners and share your positive experiences. If you need connections to any broker-friendly partners, email firstname.lastname@example.org and we can get you connected.