How to Create Your Own Mortgage Broker Business Plan
You’ve most likely heard this quote, often attributed to Benjamin Franklin, “If you fail to plan, you plan to fail.” The adage rings true in many facets of life, but none more clearly than in entrepreneurship. Without a solid business plan, it’s almost impossible to secure funding, build trust with business partners, or measure and repeat success. As a mortgage broker, a plan that’s tailored to fit the wholesale industry acts as a roadmap that can help you structure your business and scale fast.
While there’s no right or wrong way to write your business plan, there are some key sections you’ll want to include to make the most of it. Let’s take a look.
Executive Summary
After creating an aesthetically pleasing title page (because who doesn’t like pretty things), the executive summary is the first section you’ll need to tackle. It’s your opportunity to introduce your company, tell the reader what you want to accomplish, and why you’ll be successful.
Key elements to include:
Company mission statement
Brief description of your services
Basic information on your employees, leadership team, and location
Business Description
Here's your opportunity to elaborate on the points you touched on briefly in the executive summary. Use your company description to describe the mortgage industry, its’ various markets, and the problems that your business solves within it. Include and explain competitive advantages that will help ensure success for your business. As a mortgage broker, this might include the ability to offer more loan options than your retail competitors or access to the latest In digital mortgage technology. Don’t be shy about your strengths, this is the section where you explain why you’ll win.
Market Analysis
Research is a vital part of any well-written business plan, and the market analysis section is where that study shines through. What’s the current state of the mortgage industry as a whole? Where is it headed in the future, and how will you position your business for success based on that future?
What about competitors like banks and retail lenders? How are they leveraging their strengths and hiding their weaknesses?
Most importantly, consider your client, the prospective homeowner. Do you know what they want? Do you know how you will deliver? Some answers may come more quickly than others, but the time you take to invest in the competitive analysis will help you develop a winning strategy for your market.
Pro tip: Don’t forget to use your resources. Most of the information you’ll need will only be a Google search away, and the mortgage experts at organizations like BeAMortgageBroker.com can cut your learning curve in half.
Organization and Management
In this section, you’ll provide a clear vision of how you’ll operate and manage your business. This includes the legal structure of your organization as well as the experience and responsibilities of your management team.
If you’re new to the mortgage industry, or just new to the wholesale broker channel, relying on the experts can make a big difference here. Tap into your resources and research other successful mortgage broker shops. Independent mortgage brokers work as a community and many veterans in the wholesale mortgage industry are willing to help you analyze their success and organize your business to emulate it.
Services or Products Offered
Discuss the specific services you offer and how they meet the needs of your clients. For entrepreneurs hoping to create the next hot product, this section can be tricky. Explaining the benefits of a product that doesn’t yet exist can be a struggle for both investors and potential staff members.
However, if you’re starting a business as an independent mortgage broker this section is pretty simple. Your clients want to purchase homes and you use your knowledge of the product offerings of mortgage lenders to facilitate that purchase. If you plan to specialize in specific types of home loans, like VA or Jumbo, you can mention that here as well.
Marketing and Sales
The purpose of this section is to lay out your plan to market your business and generate sales. As someone who’s just getting started as a mortgage broker, keeping it simple here can go a long way.
For example, digital marketing and social media can help you attract and retain clients, and you can rely on most lender technology to see loans through to closing.
And don’t worry, writing out your marketing and sales strategy now doesn’t mean it can’t evolve later. It should. Some marketing and sales insights can only come from experience — whether it’s yours or a mentor’s — and you can continue to optimize your strategies for continued success.
Funding and Financial Projections
If you plan to ask for funding, whether through debt or equity, here’s where you’ll outline your detailed request. Specify how much funding you’ll need, any terms you’d like applied, and the timespan your request will cover. You’ll also want to add a detailed account of how you plan to use the funds.
Whether you plan to request funding or not, you will need to include financial projections. While your broker business isn’t yet established, analyze your market research to help you design projections that are both impressive and realistic. This is another section that proves the value of research and mentors.
Pro Tip: SBA.gov recommends providing financial projections for the next five years, and including quarterly or even monthly projections for the first year.
What’s Next?
Now that you have the seven essential sections of a mortgage broker business plan, it’s time to write yours and make your vision of independence a reality.
Are you ready to jump-start your career in the mortgage industry? Our team at BeAMortgageBroker.com is here to help you every step of the way.