May 04 2008
new york association of mortgage brokers
» Escrito en Cash Loan Business Tips por writer3 a las 06:54
new york association of mortgage brokers
Choosing a Mortgage Net Branch Partner can be very difficult. Navigating the ’smoke and mirrors’ makes it even tougher. Here are a few questions that you should ask every time!
1. WHAT IS A MORTGAGE ‘NET BRANCH’?
In an industry where guideline compliance is so heavily scrutinized, it is vitally important to make sure that the net branch partner you choose is operating in accordance to HUD guidelines. There are both acceptable and unacceptable ways to conduct a net branch/affiliate branch business, so it’s important to understand the differences between the two.
2. HOW CAN I COMPARE DIFFERING LEVELS OF NET BRANCH SUPPORT?
When comparing various support levels, it is important to remember that support (IT, Accounting, Payroll, Compliance, Marketing, etc) is one of the easiest claims to make, yet one of the most difficult and expensive to deliver. The key to comparing radically different levels of support lies in asking the right questions. The questions in this special report were developed with this challenge in mind. We also encourage that you visit the Corporate Headquarters of any mortgage company you are considering to get a feel for who you will be working with.
3. WHICH NET BRANCH PAY PLAN IS BEST FOR ME?
Smoke and mirrors can make certain compensation packages look more attractive than others, so let’s try to remove those advertising distractions and marketing gymnastics to get to the bottom of this very important issue.
It is important to discover how the corporate lending entity makes its money as well as their motivations to make money - Is it to grow your net branch/affiliate branch or to grow many more branch opportunities like yours? The two most common compensation structures are ‘flat fee per month’ and ‘flat fee per file’.
It’s important to keep in mind the motivations of your mortgage business partner. Do they benefit or profit when you are making money, or when you aren’t? And are they motivated to support you? In order for you to be successful, your interests must be perfectly aligned with those of your business partner. This means that the mortgage company you select must be incentivized to do all it can to ensure your success.
4. WHICH INVESTORS/LENDERS IS THE MORTGAGE COMPANY SET UP WITH?
“More” in a list of investors/lenders isn’t necessarily “better”! Look for a mortgage company that has a solid relationship with a few investors/lenders instead of a marginal relationship with hundreds of investors. Pricing, turn-times, and preferred rates are dependent upon these factors!
If the net branch company truly has high standards of excellence, it will have excellent relationships with the nation’s top investors and lenders. Stringent quality and financial requirements make it very difficult to get set up with and stay with these investors. Make sure that the mortgage company you are considering is not only set up with, but can also stay with, these top tier investors. This means more aggressive pricing for you and more money in your pocket each month. Be sure to ask mortgage net branch companies if they have ever lost the approval of any of their investors/lenders.
5. ARE THERE ANY DISADVANTAGES TO MORTGAGE NET BRANCHING?
There are a few perceived disadvantages to mortgage net branching. Let’s explore them.
1. Loss of autonomy - Those who were already in the mortgage business for themselves may worry that joining a net branch operation would result in a loss of autonomy. Look for a mortgage company or mortgage broker that places a high value on autonomy and empowerment.
2. Loss of identity - If you are considering any mortgage lending company who does not have the absolute highest reputation and integrity, this can certainly have a negative impact on your identity. By joining a highly reputable mortgage company, you are partnering with a respected name in all of the states in which they do business, and the good name of your lending business will benefit by your association with their lending business (and the opposite is also true). Look for a mortgage company which will also allow their affiliate partners to use a portion of your name behind theirs, in order to help maintain your identity.
3. Loss of tax write-offs - Some companies will allow you to expense certain legitimate business-related expenses from your branch account before taking your W-2′d income. This allows you to remain in compliance with HUD guidelines as you fall under W-2 requirements, but also lets you keep as many write-offs as possible.
For some additional questions that mortgage net branching professionals must ask any net branching company, download an exclusive free report at: http://www.netbranchsurvivalkit.com
To Your Success!
Eric Tishaw
Eric Tishaw assists mortgage professionals in reaching their next level and helps them in increasing their income-producing ability.
Eric Tishaw is C.E.O. of HomeLine, President of HomeTown Lenders (http://www.hometownbranch.com), and the Editor-At-Large of MortgageReview.net (http://www.mortgagereview.net).
Eric Tishaw can be reached via email at: Eric.Tishaw@HomeTownLendersLLC.com.
new york association of mortgage brokers
