New business is the lifeblood that keeps the engine running for mortgage broking businesses. However, a time comes when the thrill of new acquisitions is overshadowed by a growing challenge: the back book run off.
Hound was founded to help brokers put a stop to the back book run off. We filled a gap in the market by building a platform for brokers to do things differently, using the latest tools and technology, that would benefit not just brokers and their clients, but the industry as a whole.
As brokers, we revel in the success of securing fresh business deals, expanding our clientele and sustaining continuous growth. Yet, we may find ourselves facing an unanticipated plateau. Suddenly, the loans that once fuelled momentum are leaving, often without any prior notice. It’s a scenario where the influx of new business barely compensates for the losses trickling out the back door. The resulting standstill can be both frustrating and alarming, especially when the realisation hits that the most significant asset is stagnating.
Understanding the back book run off phenomenon
The back book run off isn’t a new concept. It’s the natural progression of loans decreasing in value over time, either through regular repayments or customers seeking new deals elsewhere. Though a common occurrence, its impact can be significant, especially if a broking business hasn’t prepared for or recognised the signs early enough.
Addressing the challenge head-on
So how can brokers reduce the back book runoff? Here’s three tips to help:
- Strengthen client relationships: Often, clients switch when they believe they’ve found better options or no longer see the value in their current arrangement. Foster strong, ongoing relationships with your clients. Regular check-ins, updates about market changes or even simple gestures like birthday wishes can make a world of difference. Making clients feel valued can deter them from seeking alternatives.
- Stay up to date with new offerings: Ensure you and your team are educated about the latest industry trends, tools, and technologies. Hound’s back book management system helps brokers manage and grow their business. We manage all elements of your back book to ensure you keep your clients longer, your book grows, your profit increases and most importantly, you get the best sale price for your book when you sell.
- Feedback is gold: Regularly seek feedback from your clients. Understand what’s working for them, what’s not and where you can improve. Clients are more likely to discuss their concerns with you directly if they believe their feedback is valued and will lead to actionable changes.
Embracing a holistic growth perspective
As brokers, we must move beyond the vision of new business acquisition and adopt a more holistic view of growth which highlights the retention of existing clients.
Embracing this approach not only safeguards against the dreaded back book run off but also fosters a more sustainable, resilient business model. After all, in business, those who not only adapt but anticipate are the ones who truly thrive.
By recognising the challenge of back book run off and implementing proactive strategies to combat it, brokers can ensure that their biggest asset never stands still but continues to move forward. Being a step ahead and offering clients the latest insights can position your business as a valuable, indispensable asset.
Discover how Hound can help your business and contact us today.