A mortgage broker is a legal organization or individual entrepreneur who helps clients choose a suitable loan program and carry out all the necessary procedures for concluding a mortgage agreement. The specialist must monitor all the lucrative offers from banks and other commercial institutions, know all the intricacies of credit policy and help people when preparing documents.
In any case, the essence of the profession is clear: assisting the borrower in his relationship with the bank. This service is called mortgage brokerage in professional language.
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To become a competent mortgage broker, you need to be able to assess a client’s creditworthiness, constantly study the conditions of lenders, collect a client base, and look for platforms for developing a professional blog.
Where to begin?
Business registration and contract execution.
Brokers mainly register individual entrepreneurs. The easiest option to start: individual entrepreneurs on the simplified tax system. A contract is also required for work. It helps in case of disputes with clients and protects them from insurance claims and financial risks. With this form of registration, it is enough to take into account income and pay 6% on it. Depending on the development, you can consider an LLC (to optimize taxes).
Organizing a client base and searching for platforms.
After registration, specialists use online tools, advertising or live recommendations. A broker can create a platform for searching for an audience and purchasing applications, create a page or blog and connect contextual advertising. If a specialist is confident in his abilities and knowledge, then he can use billboards, street banners, booklets and brochures. This type of promotion is riskier compared to online advertising. For beginners, it’s better to start with online promotion, and when a customer base is formed, you can connect offline.
Researching Lenders
To find a suitable lender for a client, you need to know the loan products of banks. To conveniently maintain statistics, it is recommended to create tables, enter all the data and then update it at least once a quarter.
Finding a meeting place for the audience
To receive clients, you can rent a workplace or organize meetings online. If you still decide to rent an office, then it is better to choose a place with transport accessibility, so that it is easier for clients to get to you.
Assessing the client’s creditworthiness
The broker collects all the necessary information about the client, including his financial situation, income, other obligations and debts. This allows you to assess the client’s financial stability, his ability to repay the mortgage loan, and helps the agent select the appropriate lender and loan product.
All work with registration of insurance policies in one office
- Calculate using the loan calculator
- Get offers from insurance companies
- Select an insurance company and percentage of reward
- Get rewarded
Job responsibilities
A mortgage broker represents the interests of the client who seeks help and accompanies the transaction process until its completion. The broker selects the optimal lending program, collects and submits documents to the bank, receives approval and prepares the materials necessary to conclude the transaction.
A short list of job responsibilities of a mortgage broker:
- Analysis of client documentation.
- Tracking offers from the bank.
- Calculation of payments and mortgage costs.
- Preparation of a package of documents for concluding a transaction.
- Consulting the client and providing full support until the end of the transaction.
Features of the profession
Despite the fact that the brokerage market has appeared quite recently, the work of specialists is fully regulated by law. A broker can be an individual or work on behalf of a company that provides its services to clients. Since a mortgage broker is a relatively young profession, let’s take a closer look at all its advantages and disadvantages.
Positive features:
- Opportunity to receive large income.
- Constant development in the legal field.
- Gaining influence in the mortgage market.
- Constant promotion through customer trust.
- An excellent opportunity for beginners to start.
Negative features:
- The occurrence of stressful situations.
- Not always stable wages.
- Irregular working hours.
- Non-fixed salary.
- Constant monitoring of changes in legislation.
The specialist’s total income consists of salary and interest from the transaction. For each transaction, the broker receives 3 percent of the loan value. It is important to remember that income depends not only on the level of professionalism, but also on the number of transactions completed, as well as on the region and place of work. The average salary of a specialist throughout America is 388$ per month. Brokers working in large cities earn more than 776$.
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ResultsThus, working as a mortgage broker can be a small but profitable business for lending and real estate experts. In the future, if your business develops successfully, you can expand it by opening your own agency that will provide assistance in this area.
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