Become a Loan Broker: Tips & Tricks

Your Steps for Successfully Becoming a Loan Broker

Want to Become a Loan Broker?

Are you looking to start a new career? One that gives you the freedom to be your own boss, let’s you take home 100% of your earnings, and gives you the power and prestige of a white collar professional without the expensive and time consuming education obligations? Then to become a loan broker might be right for you.

To become a loan broker you need a passion for the finance industry, enthusiasm to help people, the right training, and strong connections to lenders.

At some point, every business owner will need to borrow money. As a commercial loan broker, you act as the middleman for business owners and lenders, helping arrange all types of loans for clients to solve their financing woes.

Becoming a Loan Broker: Training

Often the first step to becoming a loan broker is to complete a training program of one to two weeks. Training provides you with the foundation of knowledge, understanding, and terminology that you will need in order to be able to communicate effectively in the industry. Having this solid foundation will ensure the success of your business for years to come.

It’s crucial to thoroughly research each training program you’re considering. It’s a big first step for becoming a loan broker and you want to make sure you’re choosing the program that is right for you. We urge you to do as much research as you can before you make a decision.

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Establishing Your Brokerage

Once you’ve completed your training and you have the knowledge of how the loan industry works, it’s time to think about the requirements you will need before your brokerage can open for business:

Licensing: One of the first things you should do is license your business. Although some states don’t require a broker to be licensed to start a loan broker business, there are some that do. The best way to determine whether or not you need a license in your state is to investigate and do your research.

Register your brokerage: Registering as an LLC provides your brokerage with the features of a corporation and the tax and operational flexibility of a partnership. In the eyes of the federal government, an LLC is not a separate tax entity, so the business itself is not taxed. Instead, all federal income taxes are passed on to the LLC’s members and are paid through their personal income tax.

become a loan broker license

Register for an Employer Identification Number: Speaking of taxes, you must register for an Employer Identification Number (EIN) with the IRS. This 8 digit number allows the IRS to identify your business and will be used when you file your state and federal taxes.

Trademarking: Become a loan broker who protects their name. Trademark your business with the US Patent and Trademark Office. Trademarking your business name prevents other businesses from operating in your geographical area with the same name.

become a loan broker business bank account

Open a business bank account and credit card account: You must keep your personal finances separate from your business finances. Having a separate bank account allows you to keep track of your finances, which will make you and the IRS happy around tax day.

For the same reasons, having a separate business credit card is also a must for becoming a loan broker. It allows you to make online transactions for your business and allows you to make charges for expenses as your continue to grow. It also protects your personal credit score.

Write all agreements: Agreements are meant to protect your business and ensures the commissions that are to be paid by the client. It’s important to be detailed and transparent about what your services will include and how much they will cost so there is no confusion once you’ve closed the loan. A good rule of thumb is to have everything in writing to minimize exposure to penalties or lawsuits.

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Cultivate An Exceptional Brand

When you are looking to become a loan broker, branding is one of the most important aspects of getting your business recognized. Becoming a regular name in the industry is much easier if you have excellent branding. Create a logo that reflects who you are and what your brokerage is all about. Make it unique, simple, and professional. Take every opportunity to get your business logo, colors, and slogan in front of potential clients. Keep your website, social profiles, and newsletters consistent. Simple logos and design are more likely to be remembered than complicated or flashy ones.

branding 101 to become a loan broker
becoming a commercial loan broker marketing 101

Have A Winning Marketing Strategy

Marketing is a critical step to becoming a loan broker which can sometimes fall to the wayside. Loan broker marketing goes beyond simple advertising and social networking. There are so many opportunities beyond advertisements to build trust with clients, lenders, and partners. These opportunities are in the way you present yourself and your firm throughout your city and beyond.

Become a Loan Broker: Stand Out!

It is important to differentiate yourself from competitors. Use marketing to build a custom brand around your business. With a professional looking website and marketing materials, you will stand out as a leader in the industry. Commercial Loan Brokers face stiff competition and appearances make a world of difference in this industry. Do your best to not get lost in the crowd which can mean lost opportunities.

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Make Google Your Best Friend

Google is the king of search engines and controls 65% of online searches. You will need to have a great Google ranking if you want to be visible. Make sure your website is clean and aesthetically pleasing and without too much spam to improve your Google ranking. Making Google your best friend will improve your funding opportunities, build your reputation and make you more money.

Build Strong Relationships

People respond better to those that they trust. It is essential that your potential clients have confidence in you as a broker. This trust comes from a process of continual interaction. Share your knowledge, be a constant source of information and show them that you are a leader in the industry. When your clients know that they can rely on you, they will return to you every time. A faithful customer is one that trusts you and your brokerage over all others.

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mentoring to help become a commercial loan broker

Right Mentor to Become a Loan Broker

A mentor provides you with immeasurable and valuable hard-earned business advise. They are there to guide you through the process, answer any questions, brainstorm and help you avoid costly mistakes. A mentor also offers an opportunity to expand your center of influence network by referring you to their contacts or sharing their contacts with you. Don’t just be a loan broker, become a loan broker who succeeds more easily and quickly with the guidance of a successful mentor.

Free Intro Event Online This Week

 

What is the OPPORTUNITY for a broker in your local market?

 

What are the BIG RISKS? And how do you AVOID them?