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MI tax deductibility considered by Congress

National Mortgage Professional
Jun 12, 2007

Questions to consider when contemplating a branch partnership opportunityDavid Baackbenefits, partnership programs, branch profits, startup costs, different programs For many mortgage broker firms, branch partnerships can be an extremely rewarding and profitable way to succeed in today's mortgage industry. There are many benefits to partnership programs that allow top-producing individual loan officers or small to medium firms to increase profits by reducing administrative costs, obtaining licensing and granting access to numerous lenders and programs. However, not fully researching the options you have when choosing a partner can be detrimental to your business. Make sure you ask yourself some of the following questions when you're choosing a business partner: What percentage of my branch profits will I receive? What startup costs will I incur? A quality company should not ask for any initial startup fees, nor should it take a large percentage of your branch profits. Make sure you find out exactly what you will be required to finance out of your branch profits to determine your take-home percentage. Ask a potential partner if they would be willing to create a reserve account during the initial months of operation as a precautionary step. What types of and how many different programs do you offer? The amount of programs and products offered will have a direct impact on your pocketbook. Products/programs such as reverse mortgages, Alt-A, Federal Housing Administration/U.S. Department of Veterans Affairs, construction, commercial, etc. will add to your list of specialties, thus allowing for more business. If you have already established working relationships with various lenders, it will be beneficial to know if you can continue utilizing those relationships or if the potential partner would be interested in adding them to its list. Do you have experienced support staff to help with various administrative functions such as compliance, human resources, information technology, marketing, payroll, processing, etc.? The purpose of partnering with another mortgage firm should be so that you can reduce time and cost spent on administrative functions and focus more on doing what you do best closing loans. The more administrative support available to you through your partner branch, the more effective you will be in reaching your goals. If I am interested in expanding my branch, what systems do you have in place that will allow me to grow? If you are looking to grow, offering employee benefits, such as health/dental care, disability, flexible spending, 401(k), etc., will be a very useful tool in recruiting professional and knowledgeable employees. Am I permitted to speak to existing managers before making a decision? Speaking to other branch partners is an essential piece of your decision-making process. Other managers will provide valuable insight into the inner workings of their partner program and will help you determine if you are the right fit. If you are not allowed to speak with others, you should reconsider your interest in a partnership, as this should be a red flag. David Baack is director of business development for Waukesha, Wis.-based First Choice Mortgage. He may be reached at (877) 326-5626.
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