So, you want to recruit a mortgage broker? – Flavin

I’m looking for a new broker. Ideally, I want someone with their own client bank, writing £200,000 per year and requiring minimal admin support – know anyone?

Yes, I just saw them riding that unicorn off into the sunset. 

As someone who coaches and mentors more than 20 mortgage business owners at any one time, I’m often asked: “What should I be paying to attract brokers?” and “What’s the going rate?”.

The answer isn’t straightforward and often involves more than a monetary incentive. 

The compensation landscape for mortgage brokers across the UK is confusing to say the least, with different business owners creating their own unique packages.

 

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Employed brokers: what’s the deal? 

For employed brokers, businesses typically offer a basic salary that can range from £20,000 to £35,000. This is then enhanced by a percentage share of the banked commission, which can range from 10% to 35%. 

The higher the base wage, generally, the lower the percentage share of the commission payment. 

All straightforward so far, but then we get into commission qualifying requirements, which can range from commission paid on everything received to not receiving commission until you’ve banked three-and-a-half times your monthly base salary. 

Confused? Imagine how the broker feels.

It now goes even deeper. Is the qualifying multiple based on the employee’s gross salary or is it the cost of the employee to the employer? Something that employees don’t realise is that the employer has to pay PAYE, National Insurance contributions and 3% pension contributions on top of the employee’s wage, which will amount to 18% on top of the base wage. For simple numbers, let’s call that 20%.

So, an employee on £30,000 per annum actually costs the employer nearer £36,000. Should the qualifying requirements be based on this higher figure, after all, that is the true cost. 

And, we haven’t even discussed enhanced commissions once the employee exceeds a set amount banked.

So, you’re trying to attract new brokers. They’re just looking at top-line figures, and as you can see, what looks appealing at face value may be very different once the package is analysed. 

Whatever you decide on, I would strongly recommend having a qualifying amount banked before making any commission payments otherwise, you could end up rewarding poor performance. 

 

The promise of full admin support 

Another confusing way of attracting brokers is the lure of “full admin support”.

This promise can range from next to no support, support once a case has been submitted, through to the broker only being required to do the discovery call and client recommendation, with the administrator booking appointments, chasing docs, submitting apps, and progressing through to completion. 

The former is a very different proposition from the latter. With good-quality brokers hard to find, keeping brokers focused on the work that requires CeMAP qualification and everything else going to admin means each broker can efficiently process more cases.

However, you can’t be expected to pay the same sort of commission rate when you’re offering such a high level of support. 

 

The promise of fully qualified leads 

Again, this statement is open to interpretation. For some, this is a data mining exercise where the new broker is offered a list of names that may or may not have made an enquiry in the past decade, yet for others, the broker has warm leads booked straight into their diaries. 

So, the commission structure takes a Newtonian level of intelligence to crack, the admin support offered depends on which way the wind is blowing, and it takes Mystic Meg to sort through how viable the promised leads are. 

 

So, how do you attract the right broker? 

The normal interview process involves the potential adviser arriving to meet an ill-prepared and time-poor business owner.

Said business owner then gushes enthusiastically about their business, takes no notes, has no set questions and gets to the end of the interview knowing nothing about the candidate but opting for the one most like them. 

How often do you get the “I really liked that broker” or “there was something about that broker I wasn’t sure of”, yet, if questioned further, they couldn’t tell you anything of importance?

By the same token, the candidate has walked out with a whole list of unanswered questions and no real clarity on whether they’d be a good fit.

One of my superstars and a company to keep your eye on is the advice firm Rebus. The owners, Lee Gathercole and Neezam Romjon, have been on a 12-month journey of reinvention.

The admin and system support they offer to brokers is very much on the latter end of what I discussed above. They’ve created a model where an average-performing broker should be able to write £20,000-plus consistently every month.

They can’t pay headline figures with this level of support, yet, they successfully recruited three advisers in March alone and have a fourth spot that will soon be filled.

So how did they do it? 

They have a strong admin team headed up by Shana, their in-house superstar; they’ve invested and built out a CRM system to automate tasks, and have implemented a robust recruitment strategy.

Once the job advert is placed on Indeed – I bet you thought they’d be paying recruiters for this sort of volume – and eager applicants are enticed, those shortlisted must complete a telephone interview to get to know the applicant.

Following this, everyone receives feedback on how they performed, their strong traits and suggestions on how they could improve. 

The successful shortlisted candidates then progress to an in-person interview. At this point, the pay structure is explained in detail, along with a full explanation of the limited number of tasks the broker would be required to complete and the level of admin support that’s guaranteed.

The lead quality and expected conversion rates are also discussed, along with an overview of the new starter’s first three months in position. At this point, it’s more about understanding the individual and making an assessment of whether they would be a good fit for the team than it is about the knowledge of the broker. 

Again, after the interview process is complete, the same high level of feedback is given. 

March: three positions offered, three accepted and all through taking the time to clarify everything prior to progressing, getting to know each other and being fully open and honest about expectations, rewards and company culture. 

They’re also perfecting an onboarding process that’ll blow the new advisers’ minds with the depth of training, support and investment Rebus is willing to make into their teams’ development. Attitude is what rules the final decision, not adviser ability.

Only those with a great attitude and willingness to integrate into the team are accepted.

 

So, how do you entice the right broker to your company? 

Firstly, you need to clarify a pay structure that’s simple to understand and is a win-win for all concerned.

There’s no point offering overly elaborate schemes where goalposts get moved just enough to prevent qualifying for a bonus. There’s also no point in being overly generous to the point that the company is losing on every completion. 

Secondly, take as much of the admin work away from the broker as possible.

The broker didn’t go through CeMAP or CII to become an administrator 80% of their day. Keeping the broker focused on CeMAP-qualified tasks works for everyone. Admins are far more efficient at administrative tasks, freeing up advisers to double down on the £300 per hour of work. Also, make sure you have the systems in place that offer support to your admin team, ensuring repeatable quality is delivered.

Be honest with the broker at the outset on expectations in this area of the role. If the admin and system support are scant, then be honest about it and be willing to pay a little extra. If the admin and system support are top-notch, then show the broker how that enhances their ability to submit higher volumes of business and therefore increase income. 

Thirdly, be honest about lead quality, conversion rates and expectations. If you have high-volume, low-quality leads, say so. If calls need to be responded to within a certain time, let them know. If they need to cover phones on a Saturday, don’t hide it in their contract and hope they don’t spot it before they start. 

With great systems, a strong admin team, good-quality leads and a robust company culture, you don’t need to track down the unicorn brokers. You simply need brokers who are willing to follow systems, genuinely have the best interest of the customer at heart and appreciate the team around them, are all part of the delivery process.

Add in a great attitude, and you’re on your way to building a winning team; that last attribute is probably the most important.