In the Introduction of this book I raised the concept of Dependent and Independent Brokers, which I will now more clearly define, as well as how to move from being Dependent to becoming Independent.

The term ‘Independent’ is not one Mortgage Brokers are meant to use when referring to our services to the public and the lenders we might choose for them. However, I am referring to ‘independent’ in terms of the real control the Mortgage Broker has over the source of their clients and the flow on effects that has over the independence of their entire business from external forces, not on their service to their clients.

To understand the difference between Dependent and Independent Mortgage Brokers, I will raise again of the four components of a Mortgage Broking business, the key systems of any broking business which I will be returning to throughout my posts.

  1. Initial Marketing — generating inquiries from prospects
  2. Sales — proving to these prospects that they should use your services
  3. Operations — helping your new client to get their next home loan
  4. Post-Sales Marketing — generating future inquiries and referrals from clients

By my definition, an Independent Broker is one who is self-sufficient in the first part of their business – their initial marketing or lead generation. As such they are attracting their own initial client inquiries. The effect of this on the rest of their business is that they have greater control over their sales process, the service they deliver to their clients and how they promote themselves to their client base. Their clients are genuinely ‘their’ clients.

I am not saying that an Independent Broker doesn’t have referral partners. They may have just one or they may have many – with many obviously being a stronger and safer business. The difference is that they are in control of those referral relationships and as such can easily switch to a new referrer or add new ones if these current relationships aren’t performing for them.