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Three Common Outsourcing Mistakes Mortgage Brokers Make

The mortgage broker industry is in a period of change. Increased demand for compliance has caused processing times to increase, yet income per deal remains at its previous level because brokers are still doing more work with less client contact than ever before. 

To meet the ever-growing demands of the industry, most brokers outsourced some or all of their loan processing to an offshore team. While outsourcing promises a streamlined and cost-efficient workflow, it could lead to efficiencies if done incorrectly. 

Mistake #1: Starting by outsourcing the most complex work

We get it. Outsourcing promises a lot of potential so it is normal to get excited. You start thinking about all the tasks that take most of your time and prevent you from getting home in time for dinner. As a result, you list down 2 to 3 complex tasks to try out your outsourcing strategy. 

However, outsourcing the most complex tasks first makes it harder to succeed. 

Instead, we recommend starting with the low-value tasks that are standardised, process-driven and time-consuming. That way you can have some quick wins before you build up the complexity.

Mistake #2: No systems and processes

Without comprehensive systems and processes, your outsourcing efforts will require more of your time and effort than you anticipated or even worse, may fail. Mortgage broking virtual assistants are eager to learn and to do well. They are excellent at following instructions and this includes BAD instructions. When tasks are delegated without proper instructions, there is no way your offshore team will meet your expectations. 

The solution is to build comprehensive systems and processes that provide your team with the “train tracks” they need to stay aligned. It gives you the visibility and activity logs you need to be at ease and ensures that everything is on course. 

Mistake #3: Going straight to the client-facing roles

Most of our clients in Koruna Assist, use their offshore members for non-client facing use. They are broker-face and lender-facing but don’t interact with the clients directly. Client-facing roles take time to master, and it’s not recommended to put your offshore team members into the mix until they have mastered all the simpler functions first.

Their Australia-based Client Service Manager (CSM) and their brokers retain the service function whilst their offshore team takes care of the back office. 

When mortgage brokers imagine the potential pitfalls of outsourcing, they sometimes visualise their new offshore team member struggling to troubleshoot a tricky servicing problem for one client who’s in an elite group. You’re right: that would be super challenging and not really how this works! they have mastered all the simpler functions first.

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The 90 Things you can Outsource

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Case Study:

Chris Brown is a Director and Senior Mortgage Broker at New Vision Financial Services. He runs a Sydney based mortgage brokerage that’s servicing clients since 2015.

Case Study:

Sam Panetta is a co-founder and the head of the lending department at Aureus Financial. His business helps clients get the funding that they need to grow their business, acquire their dream home and build wealth through property.

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