Knowing Your Numbers: A Guide for Mortgage Brokers
Welcome to this week’s Mortgage Broker Broadcast! In this episode, we focus on one of the most crucial topics for mortgage brokers—knowing your numbers. Understanding and tracking the right metrics is key to growing your business and achieving your income goals. Whether you’re a seasoned broker or just starting out, this guide will help you break down the numbers that matter and show you how to use them to drive success.
Why Knowing Your Numbers Matters
Without a clear grasp of your numbers, it’s easy to lose sight of your business performance. Tracking the right metrics gives you a 100% handle on your business, enabling you to make data-driven decisions and achieve your financial goals.
Benefits of Knowing Your Numbers:
- Helps set realistic income targets.
- Allows for informed decision-making.
- Identifies areas for improvement.
- Keeps you on track to meet your business objectives.
Step 1: Start with Your Income Goal
Everything begins with your income goal. Ask yourself:
- What do I want to earn in 2025?
- What income target aligns with my lifestyle, work-life balance, and business goals?
Once you have an income goal, work backward to determine how much business you need to generate to reach that target. For example, if your goal is £75,000, you’ll need to calculate how much commission you need to generate.
Example Calculation:
- Income Goal: £75,000
- Commission Split: 75% to you, 25% to your network
- Required Business Volume: £100,000 of issued business
If your completion rate is 85%, you’ll need to submit approximately £120,000 of business annually to hit your income target. Break that down to £10,000 of submitted business each month.
Step 2: Calculate Your Average Case Size
Your average case size will vary based on your location, client type, and protection sales. To determine your average case size, add up your broker fees, protection premiums, and property fees, then divide by the number of cases.
Example:
- If your average case size is £1,500, you’ll need to submit 6 mortgage cases per month to hit your monthly target of £10,000 in business volume.
- Adjust your calculations if your case size is higher or lower.
Step 3: Track Key Metrics
In addition to your income goal and average case size, there are several other metrics you should monitor to get a full picture of your business performance:
- Submitted to Completion Rate
- Industry average: 70%
- Aim for at least 85%.
- Review your post-sales process if your completion rate is low.
- Lead Conversion Rate
- How many leads convert into submitted business?
- Example: If your conversion rate is 1 in 3, you’ll need 18 leads per month to submit 6 cases.
- Use this data to set realistic marketing and lead generation goals.
- Average Broker Fee
- Monitor your average fee to ensure consistency.
- If your average fee starts to drop, it may indicate you’re waiving fees too often.
- Protection Sales
- Track your average monthly protection premium.
- If your premium is dropping, reassess your sales skills and client approach.
Step 4: Website and Social Media Metrics
If you’re generating leads from your website and social media, it’s essential to track their performance:
- Google Analytics: Monitor traffic sources, page performance, and conversion rates.
- Social Media Engagement: Focus on reach, growth, and engagement rate—not just vanity metrics.
- Client Reviews: Reviews build trust and credibility. Aim to collect reviews at the mortgage offer stage when client satisfaction is high.
Why These Numbers Are Essential
Tracking these metrics gives you the insight needed to make informed adjustments. Often, small tweaks—such as improving your post-sales process or refining your lead conversion strategy—can have a significant impact on your business.
For instance, if your lead conversion rate is lower than expected, focus on improving your marketing efforts and client engagement. By knowing your numbers, you can close gaps in your business and hit your goals with confidence.
Key Takeaways
- Start with Your Income Goal: Define what you want to earn and work backward.
- Track Your Metrics: Monitor average case size, completion rate, broker fees, protection premiums, and lead conversion rates.
- Optimize and Adjust: Use your data to identify areas for improvement and make small, targeted changes.
- Leverage Website and Social Media Analytics: Understand what’s working and where you can improve.
- Collect Client Reviews: Make client feedback part of your process to build trust and credibility.
Final Thoughts
Knowing your numbers is one of the most powerful tools you have as a mortgage broker. It’s the foundation for achieving your income goals, improving business performance, and growing your brand. Start tracking your core metrics today, and use the insights to make smarter decisions and drive your business forward.
Subscribe to The Mortgage Broker Broadcast for more actionable strategies. If you’re ready to take your business to the next level, visit craigskelton.co.uk to book a discovery call. Let’s chat about how I can help you achieve your goals for 2025 and beyond.