The majority of requests for mortgages are generally fairly straightforward. 60% of all borrowers get their mortgage directly through a bank, but 40% choose to use a mortgage broker even where their situation is fairly straightforward. Mortgage brokers love these clients, and view them as a slam dunk and relatively easy money.
Jeanette Singer, certified mortgage broker at MortgageBrokersNZ.info
However a percentage of clients have particular issues with their application that need a more lateral thinking approach from the mortgage broker, and it is here where good mortgage brokers come into their own. If they can find a solution for the client, even a very left field solution, then they stand to earn their commission and probably further referrals from a very happy client. In some cases the broker will need to recommend that the client takes other actions before they will be able to apply for a mortgage, and this may take several months, but in the end a good mortgage broker will still get their business.
One classic problem that can test Wairarapa mortgage brokers (link) is where a landlord has discovered that one of their properties needs expensive corrective action to remedy for P contamination, and they need to find finance to help them through the problem. This can be financially devastating for the clients and hugely expensive, and a good broker will need to be very empathetic and imaginative in dealing with their problem.
Another classic problem is separation where one partner is trying to purchase a family home or flats off another partner. Generally the problem lands at the woman’s feet, and brokers find themselves dealing with a client who has no or minimal income and an ex partner who is playing very hard ball with the relationship assets. In these situations the broker can be both advisor and coach, and can help the client take a step back and look at things in a more pragmatic way. A good mortgage broker will advise their client in such a way that the client is much better off no matter what the broker recommends.
Many clients really only need coaching and encouragement, and in this area mortgage brokers are generally very good, simply because they don’t get paid unless the client eventually get some mortgage. Clients can be procrastinators or simply too timid to take the big step of committing to a mortgage, and a competent broker will be able to assess the clients ability to handle a mortgage and then encourage the client every step along the way to actually get the application into the bank and to get it approved. They may have to both encourage and embolden the client, and in most cases they will make certain that the client knows that they can call them at any time and that the broker will call them back after a few months just to check that their mortgage is going fine.
The mortgage broking market in New Zealand is dominated massively by a handful of large broking companies. These companies have made very large and very strategic investments in Internet search ranking, as they recognised at an early stage the massive trend particularly amongst millennials to choose products and services using Google Internet search.
At the time these companies made this investment it would have appeared courageous, as there was no certainty that they would get any significant payback. There has always been a wide acceptance of the need for an extensive marketing budget, but this was generally for the more traditional forms of marketing such as television and news print advertising and billboards etc. Investment in Internet search required a significant leap of faith.
For a small handful of mortgage brokers in Canterbury this has indeed been a lucrative investment, as through a combination of very smart web and SEO development and a fair degree of good fortune they have managed to get themselves ranking in the top 3 of Internet searches for the major keywords. Others may have spent similar amounts of money but did not succeed in getting the top ranking, and for these unfortunate companies their investment has been largely wasted.
The simple fact is that the top 3 Google searches almost always win over 60% of the total Internet search traffic, and if you are not on page 1 then you will be sharing around 1% of the total Internet search traffic with all of the other mortgage broking companies and pages 2 and beyond. It is a ruthless business.
Any mortgage brokers Christchurch who are not in the top handful of Google searches simply cannot rely on the Internet as a source of new business, and they have to rely on more traditional approaches such as networking in the industry, referrals and repeat business. In all cases they have to deliver genuinely good service or their reputation will suffer and they will quickly go out of business.
Meanwhile the large broking companies having to cope with the opposite problem of new business continuously rolling in the door, and so they all have administrative staff who are screening the calls to make certain that only the most likely candidates for a mortgage get passed to the brokers. The companies sleep well at night knowing that there is always new business rolling in the door, even if they happen to deliver poor service and a poor experience. Every customer is a new customer who is not connected to someone knowledgeable and therefore does not know about industry reputations. Its important to know how to find a good mortgage broker so you can get a good deal.
The good news is that this market is ripe for disruption, as other canny players with extensive SEO capability can rank their own websites in the top 3 searches, and can steal some business out from under their noses of the major players.
The casual observer may believe that one mortgage broker performs the same role as another in the New Zealand context, but this is not so. Mortgage brokers in Hawke’s Bay have divided themselves into different categories, and they serve different markets and they most certainly carry out their service in different ways.
This article looks at the residential market and the different treatment that is given by different categories of mortgage brokers.
In many respects there are basically two groups of mortgage brokers Bay of Plenty. One group comprising a small number of very large mortgage broking companies that are processing a large number of mortgages and are getting most of their leads from the Internet. This group has invested a very significant sum of money in their digital marketing capability, fundamentally to make certain that they are ranking very highly for common Google search terms relating to mortgage brokers. They have also invested heavily in their website to make certain that there is a high rate of conversion, meaning a high percentage of visitors to their website and up by contacting them..
While this initial upfront investment can be very substantial indeed, the Executives making the decision for this investment are obviously very well aware of the almost unbelievable business case. The truth is that Internet search is growing almost exponentially across all markets for all products, and the customers doing the same thing almost always choose those websites that rank in the first two or three on page one. What this means in effect is that a company who has their website ranking number one will be attracting at least 100x more Internet based business then companies that are stranded on page 2 or beyond. While the investment required in SEO can be massive, the financial Rewards can be almost unbelievable if the company gets ranked #1 or #2.
Typically these large companies get so much incoming business that they use low level admin staff to screen the callers, so that only the customer’s absolutely certain to get a mortgage are passed through to a broker for service.
The second group of brokers or everyone else who was not on page 1, and these will generally be small brokerages or individuals operating independently. The main financial benefit for these brokers is that they do not have to pay any franchise fees or commissions, but the disadvantages that they will have to work very hard for new business in most cases. There are a lot of successful brokers out there who have built up a very good network of real estate agents and property developers etc, and they should be getting a lot of referral business and repeat business. In fact referrals and repeat business is generally the main way that all the second group of brokers find their new business.
It is the responsibility of the team leader on any building site to make sure that the site and all the workers are safe. The obvious impact of this to the casual observer is the erection of barrier fencing around the perimeter of the worksite, and the erection of scaffolding around the perimeter of the new building.
Less obvious is the safety steps that are taken all the time by the team leader. These will include a team meeting at the start of each working day at which there will be an honest discussion about all potential safety hazards, and how the workers should deal with these hazards. This is a complete change from the previous culture where workers were encouraged to just get on and do it, and to not appear to be weak or fearful on the job.
Old style builders Dunedin who are now retired are often highly critical of the nanny state and it’s impact on building sites, but these builders are now often nursing lifelong injuries from falls, and many of them are missing digits or even limbs from serious accidents during their career. It is quite common amongst a social group of retired builders for there to be at least one or two of the Party with missing digits or limbs, or with injuries that cause them to limp badly.
The safety practices on a modern building site are wrapped around keeping unsafe individuals off the site, and making sure those on the site are safe from the obvious accidents like falls or collisions with unsafe materials and structures. The barrier fencing and scaffolding is the most obvious example of safety practices, but the modern equipment used on site is also very heavily focused on worker safety. The best example is the modern drop saw, which makes it very difficult for the worker to injure themselves plus makes it very easy to produce very accurate work.
The modern nail gun can also be very unsafe if used incorrectly, and the builder needs to be very clear in their instructions to the workers on the safety steps that are needed. Everybody on the site needs to understand that a nail gun is fully capable of firing a nail right through the timber and hitting any object on the other side, and hence all workers need to know the steps to take to make sure they are safe while a nail gun is being used. The Builder using the nail gun also needs to make certain they are using the right nail and the right strength of charge for driving in the nail.
In New Zealand around 85% power electricity this generated renewable, mostly through hydroelectric but also including geothermal and wind power. New Zealand is a lucky country in this respect, but it could do even better by installing mass of storage batteries that will pick up the slack it is otherwise filled by call and natural gas generation.
Other countries are not nearly so lucky, and in Australia for example only 17% of all the electric power is generated renewably. The remaining 83% is generated mostly by coal and buy some natural gas.
Australia is naturally a very sunny and hot country, and in some parts of Australia up to a third of households have installed solar panels on their roofs, and they have done this purely for economic reasons because it’s save them a lot of money over the long term by cutting down their peak electricity usage which is the major cost component and there Power bill. The solar market across Australia is growing massively, and although a number of politicians have a vested interest in making certain that fossil fuels stay in the mix for a very long time, they cannot stop the development of solar because it is so popular amongst the population at large.
Renewable Energy Wind Energy Pinwheel Wind Power
The cost of solar power has been decreasing exponentially for decades, and ominously for the coal industry is now priced lower over its lifetime for a utility scale power plant then the equivalent coal fired power plant. In South Australia the state government has signed a contract with Tesla for the supply of a massive storage battery that will store the solar and wind power generated during the day and make this available for overnight yes. This storage battery will replace a gas fired peaking plant, and will consist of a large number of white cabinets installed innocuously in a convenient Outdoors location, and Tesla has contracted to have the battery up and running within 100 days or the State government gets their money back.
This one project is having a seismic impact on the utility power generation market around the world, as politicians and utility companies waking up to the fact that solar and wind power plus battery storage it’s cheaper then it’s coal and gas fired equivalent, is much quicker to install, and has zero negative impact on the environment including no carbon emissions. Australia has vast areas of land available for solar power, and has a very reliable source of sunny days, and solar coupled with battery storage will grow explosively over the next decade or so.
The South Australia battery project will see and a very ominous signal to the coal and Gas Industry, and investors in these Industries we’ll see very clearly that the future is bleak, and as a result investment for expansion will dry up.