Experts reveal top tips for new brokers

Key industry players discuss top trends in the mortgage sector and how new brokers can thrive in today’s fast-paced environment

WITH INTEREST rates rising, sky-high property prices and pressure on housing supply, it’s fair to say that the Australian mortgage market is tough at the moment. But while new loan volumes have dropped, the demand for mortgage brokers has remained strong, and quality financial advice is now needed more than ever. According to the ABS, in August 2022 the value of new loans for housing fell by 3.4%, and for business purchases of property values declined by as much as 23.6%. Interest rates have also been climbing steadily, with the RBA raising its cash rate every month since May. Amid this pressured environment, customers are increasingly shopping around for the cheapest and most flexible loan options – and crucially, for professionals who can guide them through the difficult process of securing a mortgage. Customers flock to brokers for advice Commenting on demand levels over the last 12 months, Mortgage

The shift to remote work has accelerated the trend. People are realizing they don’t need to be in urban centres and can get more space for less money in the suburbs. “We are still seeing strong lease-up in those communities,” Romundt says. “There are some who say when the pandemic ends, this all goes back to normal, but I don’t ascribe to that view. Some of those people moving to the suburbs will find it is pretty good, and employees will expect to be offered workfrom- home days as a benefit. Even if it is not every day, it will become a more lasting trend, allowing people to live in the suburbs.” This deurbanization is occurring across Canada, Romundt says – people are going from big cities to medium and smaller ones all around the country, and he doesn’t foresee this ending anytime soon.

According to Croucher, one of the most important things a new broker can do is build strong relationships with lender BDMs and relationship managers. This means communicating with them proactively, understanding their work process, and speaking up if they are having trouble with any aspect of the deal. “Having that relationship will really help you to understand the loan process and how the team operates within the bank,” Croucher says. “Brokers should ensure that they’re up to date with all the policy requirements and any changes that are introduced. That can be hard right now as there are so many changes coming rapidly, but communication is king, and having that regular contact with your relationship manager is absolutely paramount. “I would also encourage brokers to leverage all the tools that they have available,” Croucher continues. “From a bank perspective, we have many different ways for a broker to get information. At CBA, we have a training hub that delivers training and assistance to brokers, and we’ve seen great uptake of that over the last year. There are lots of webinars and workshops that brokers can attend to help them understand the end-to-end process.”

Brokers in Australia: The stats

“When you think about the number of rental units being built in downtown Toronto or Vancouver, there aren’t many of them,” he says. “It is far more profitable to build and sell condos. If a builder goes to the suburbs, they can buy a two-acre piece of land and put up a 100-unit apartment building. They can use less expensive technology, wood or steel versus concrete, can do surface parking, and elevator runs are less expensive in a four- or six-storey building. So it is much more affordable to build them there.” That affordability for builders can quickly turn into value and returns for asset managers and investors who get involved with these types of properties.

When it comes to rates, Waldron says these will be a key focus for many brokers and their clients in the coming months – particularly as fixed rates rise and variable rates become a potentially attractive alternative. “A lot of Australians will be coming off fixed rates in the coming months, which will create many opportunities for brokers to connect with customers and provide guidance in a rising interest rate environment,” Waldron says. “Combine this with the industry’s current trajectory, and we’re likely to break through the 70% milestone of residential loan market share.” How new brokers can thrive Starting out as a new mortgage broker is no easy task. Fortunately, there is a huge wealth of resources, tips and tools to help you get started, build a strong contact base and grow your business.

At Commonwealth Bank, we know brokers deliver exceptional outcomes for customers, which is why we are focused on delivering simpler, better and easier processes to provide brokers with an enhanced level of support every step of the way. Our strategy has been designed based on broker feedback, and focuses on how we can improve the experience and build a strong and more sustainable third party banking channel that helps you – our broker partners – to support more customers in achieving their homeownership goals. If you’re not already accredited with CommBank, now is a great time to join us, as we have simplified our accreditation process. Head to commbroker.com.au to find out more. And if you are already accredited with CommBank, check out our free 24/7 training hub – it’s all part of our commitment to being better together and supporting you every step of the way.

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For 30 years Mortgage Choice has been at the forefront of Australia’s mortgage broking industry, and under new ownership as part of REA Group, a leading global digital business specialising in property, this doesn’t change. As a network of close to 1,000 brokers and more than 750 franchises nationally, Mortgage Choice remains one of Australia’s most trusted and recognised brands, with over 95% brand confidence among consumers. Mortgage Choice is passionate about helping people afford the things that are important to them, whether that’s buying a home, buying a new car or starting a business.

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“As we continue to grow, we need to ensure that the new brokers we’re bringing on board can deliver the exceptional levels of finance expertise and service consumers expect.” From a banking perspective, Croucher says brokers coming from banks need to be particularly conscious of the differences between how different lenders work. Credit policies, turnaround times and the way they handle things like self-employed applications – all of these vary from lender to lender, and so new brokers need to have a solid grip on how each lender operates. He says the value of mentoring and industry connection is also huge, particularly in the first few years of your broking journey. “I’d encourage new brokers to work closely with a mentor, and to choose a mentor who is aligned with your business goals,” Croucher says.

“Brokers should ensure that they’re up to date with all the policy requirements and any changes that are introduced. That can be hard right now as there are so many changes coming rapidly, but communication is king”

Adam Croucher, CommBank

In Partnership with

Romundt says there are many reasons for this migration to the suburbs, but it’s mostly driven by a desire to save money. As a result, many suburban parts of the country are seeing a rapid rise in population and rentals because people want to go there and there aren’t enough rental units to meet the demand. Romundt points to Kelowna and Victoria in BC, both areas where Centurion has properties. “We call it an exurban strategy to Vancouver,” he says. “We bought those properties pre-pandemic, because we thought people would go there and saw this playing out in other parts of the country. You can be in commuting distance, and it will cost you half.”

“You can also work with your aggregator. They will really help to support your business and growth, and they can also connect you to lenders, other industry professionals and referral partners. “Connecting with other brokers is also very useful,” he concludes. “The great thing about this industry is that there are a lot of people who have a lot of time for other individuals, and many brokers have faced a huge learning journey. Don’t think that they don’t have the time to support you in turn. I’d really encourage new brokers to take advantage of that!”

“A lot of Australians will be coming off fixed rates in the coming months, which will create many opportunities for brokers to connect with customers and provide guidance in a rising interest rate environment”

Anthony Waldron, Mortgage Choice

Choice CEO Anthony Waldron says his brokers have been inundated with clients seeking advice, and mortgage brokers now account for a significant chunk of loan originations. He says there was also a “strong uptick” in new brokers joining the industry over 2020–21, largely driven by the skyrocketing demand seen throughout the COVID-19 pandemic. With credit policies tightening and interest rates rising, 2022 has continued that trajectory, with demand levels showing no signs of dropping any time soon. “From an industry perspective, the RBA has now raised the cash rate every month for the past six months, and there’s constant media speculation about property prices, compounded by uncertainty in global and domestic markets,” Waldron tells MPA.

Industry experts

Christopher Lee

MFAA head credit adviser, Finsure Finance and Insurance

Stewart Saunders

Heritage Bank

Adam Croucher

Commonwealth Bank

Anthony Waldron

Mortgage Choice

Industry experts

With over 25 years’ experience across financial services, mortgage broking and business management, Anthony Waldron took on the role of CEO at Mortgage Choice in 2022. Known for building inclusive high-performing teams, growing businesses and creating sustainable business outcomes, Waldron has built a strong reputation for leading positive strategic change in the industry. He led the transformation of NAB Consumer Banking throughout the COVID-19 pandemic and has consistently championed the interests of customers across the mortgage broking industry.

Mortgage Choice

Anthony Waldron

Adam Croucher has been in the industry for over 25 years, with over 12 of those years in mortgage broking. In the first 17 years of his career, he managed retail branches. By 2014 he had moved into third party banking as state manager at Commonwealth Bank, then in 2019 he became head of third party. Last year, Croucher hit a huge milestone – being named in the 2021 Mortgage Global 100, recognising industry professionals who are making a positive difference and helping drive change across the sector. He continues to support and guide his teams on the importance to brokers of transparent communication so that together they can help more Australians reach their homebuying goals.

Commonwealth Bank

Adam Croucher

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Heritage Bank

Stewart Saunders

MFAA head credit adviser, Finsure Finance and Insurance

Christopher Lee

MFAA head credit adviser, Finsure Finance and Insurance

Stewart Saunders

Heritage Bank

Adam Croucher

Commonwealth Bank

Anthony Waldron

Mortgage Choice

Industry experts

Mortgage Choice

Anthony Waldron

Commonwealth Bank

Adam Croucher

Heritage Bank

Stewart Saunders

MFAA head credit adviser, Finsure Finance and Insurance

Christopher Lee

Anthony Waldron

Mortgage Choice

Adam Croucher

Commonwealth Bank

Stewart Saunders

Heritage Bank

Christopher Lee

MFAA head credit adviser, Finsure Finance and Insurance

Mark HarChristopher Leeon

Heritage Bank

Stewart Saunders

Adam Croucher has been in the industry for over 25 years, with over 12 of those years in mortgage broking. In the first 17 years of his career, he managed retail branches. By 2014 he had moved into third party banking as state manager at Commonwealth Bank, then in 2019 he became head of third party. Last year, Croucher hit a huge milestone – being named in the 2021 Mortgage Global 100, which recognises industry professionals who are making a positive difference and helping drive change across the sector. He continues to support and guide his teams on the importance to brokers of transparent communication so that together they can help more Australians reach their homebuying goals.

Commonwealth Bank

Adam Croucher

Mortgage Choice

Anthony Waldron

(August 2022)

“With these factors at play, it’s no wonder that in 2022 we’re seeing almost 70% of Australians using mortgage brokers to expertly guide them on what’s likely to be their largest commitment. “At Mortgage Choice, the number of new brokers entering our network has consistently grown over the past two years,” he adds. “In FY22 we were able to surpass the significant milestone of having more than 1,000 brokers across our national network. Some feared that the introduction of the best interests duty and other regulatory changes would see brokers leave the industry in droves, but that just hasn’t happened.”

68% of all new residential home loans were facilitated by brokers in August

11% increase from previous quarter (57%)

9% increase from same quarter in 2021 (59%)

$96.1bn in home loans were settled by brokers

Source: MFAA

Source: ABS

Month-on month change in value of lending – August 2022

Value of new loans for housing fell by 3.4%

To access support, a broker group is usually one of the best resources – and at Mortgage Choice, offering a range of strong support options has been a key area of focus over the last several years. Anthony Waldron says brokers are always encouraged to “get on the tools” as soon as they’re ready. At Mortgage Choice, these include a fast-tracked Certificate IV in Finance and Mortgage Broking; access to a Level 1 coaching program that supports a broker’s first set of applications to lenders; access to a team of credit coaches who provide support and education with lending scenarios; and a two-year ‘accelerate’ mentoring and franchise development program. Mortgage Choice brokers also have access to marketing support, which includes the development of a ‘minisite’ for each new franchise, and advice on creating social media and marketing campaigns. “Brokers arrive at Mortgage Choice from many different backgrounds and lines of work – there is the traditional banker-to-broker path, while others come from teaching and academia, as well as industries that experienced harder times during the pandemic, such as hospitality,” Waldron says.

What’s important to today’s customers? When entering the mortgage industry, new brokers need a solid understanding of key market trends, challenges and customer needs – all of which can change very quickly. Commonwealth Bank has seen a significant rise in broker market share over the past year, with 67% of its applications in Q1 coming from the broker channel and peaking at 70% in Q3. According to Adam Croucher, CommBank’s general manager third party banking, the ability of brokers to understand a fast-moving market has been vital to customers, along with their ability to navigate today’s biggest pitfalls and challenges. “Cashback and rates are extremely important to customers right now as we see an increase in costs, and pressures on affordability,” Croucher says. “Our research has also shown that customers are looking for a lot of flexibility with their home loans. They want to know about repayment holidays, changing loan amounts, frequency and dates, as well as other value-add options for saving, whether that’s on energy, NBN or other parts of the proposition. “Customers are doing a lot of research right now to understand the cheapest options,” he explains. “The refinancing market has really increased, taking up about 40% – close to $18bn – of the total market for the month. We want to make that easy by having as much transparency as possible with our pricing, as well as offering flexible credit policies for customers.”

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From a banking perspective, Croucher says brokers coming from banks need to be particularly conscious of the differences between how different lenders work. Credit policies, turnaround times and the way they handle things like self-employed applications – all of these vary from lender to lender, and so new brokers need to have a solid grip on how each lender operates. He says the value of mentoring and industry connection is also huge, particularly in the first few years of your broking journey. “I’d encourage new brokers to work closely with a mentor, and to choose a mentor who is aligned with your business goals,” Croucher says.

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Value of new loans to owner-occupiers fell by 2.7%

Value of new loans to investors fell by 4.8%

Value of new personal fixed term loans grew by 9.5%