Feeling like you’re missing out on personalised support in your brokerage?
It’s not just you.
Subaggregators offer tailored assistance that larger aggregators often can’t provide.
Let’s break down what subaggregators are and how they can help streamline your brokerage.
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What is a Sub Aggregator?
Sub aggregators play a crucial role in the mortgage broking hierarchy, acting as intermediaries between primary aggregators and smaller brokers. They serve as intermediaries between primary aggregators and smaller brokers, providing additional support and resources to brokers such as access to a wide range of lenders and mortgage products.
Sub-aggregators also offer training and development programs, compliance support, software solutions, and marketing resources to enhance brokers’ capabilities. Additionally, they provide technology solutions to streamline processes and offer administrative support to allow brokers to focus on client relationships. By pooling business, sub-aggregators negotiate better terms with lenders, giving brokers a competitive edge.
Functions of Sub Aggregators
Subaggregators play several key roles in the mortgage broking ecosystem.
- Providing Training and Support to New Brokers: Sub-aggregators often offer training programs and ongoing support to help new brokers get started and succeed in the industry.
- Acting as Intermediaries for Smaller Brokers: They bridge the gap between smaller brokers and primary aggregators, making it easier for brokers to access a wide range of loan products.
- Facilitating Better Relationships with Primary Aggregators: Sub-aggregators help smaller brokers build and maintain strong relationships with primary aggregators, ensuring they receive the best possible support and resources.
- Marketing and Lead Generation: Sub aggregators provide tools and resources to help brokers generate leads and market their services effectively.
- Technology and CRM Systems: Sub aggregators offer CRM systems and other technological tools to help brokers manage client interactions, streamline their workflow, and stay organised.
Services Offered By Sub Aggregators
Training and Mentoring
One of the most valuable services sub-aggregators provide is training and mentoring. This is crucial for new brokers who need guidance to navigate the complexities of the mortgage industry. Continuous professional development ensures brokers stay updated with industry trends and best practices.
Business Support
Sub aggregators offer a range of business support services, including:
- Back-Office Administration: Handling administrative tasks allows brokers to focus on client relationships and loan origination.
- Marketing and Promotional Material Provision: Providing marketing resources helps brokers attract and retain clients.
- Customer Relationship Management (CRM) Systems: Offering CRM systems enables brokers to manage client interactions and streamline their workflow.
Compliance and Education
Ensuring compliance with regulatory requirements is another critical service provided by sub aggregators. They offer resources and training to help brokers stay compliant with industry regulations, reducing the risk of legal issues.
Advantages Of Utilising Sub Aggregators
Lower Entry Barriers
Sub aggregators lower the entry barriers for new brokers by reducing initial costs and providing easier access to a range of lenders. This makes it more feasible for individuals to start their own broking businesses.
Focused Attention
Compared to larger aggregators, sub aggregators can offer more personalised support. This focused attention includes tailored mentoring and guidance, which can be invaluable for brokers looking to grow their businesses.
Enhanced Business Growth
Sub aggregators often provide better commission structures and incentives, along with access to tailored business platforms and tools. These resources can significantly enhance a broker’s business growth and profitability.
How To Choose The Right Sub Aggregator
Factors To Consider
When choosing a sub aggregator, brokers should consider several factors:
- Range of Services Offered: Ensure the sub aggregator provides comprehensive services that meet your business needs.
- Cost-Effectiveness and Fee Structures: Evaluate the fee structures to ensure they are cost-effective for your business model.
- Quality and Extent of Mentorship Provided: Look for sub aggregators that offer high-quality mentorship and support.
Researching Options
To find the right sub-aggregator, brokers can:
- Check Industry Associations: Organisations like the Mortgage & Finance Association of Australia (MFAA) and the Finance Brokers Association of Australia (FBAA) provide listings of reputable sub aggregators.
- Evaluate Reviews and Testimonials: Reading reviews and testimonials from other brokers can provide insights into the sub aggregator’s reputation and service quality.
- Consult with Other Brokers: Networking with other brokers and seeking their recommendations can help identify reliable sub aggregators.
Examples Of Sub Aggregators
Notable Sub Aggregators
Several sub-aggregators have established themselves as leaders in the industry. Notable examples include:
- Buyers Choice
- Vision Aggregation
- Regional Finance Brokers (Regfin)
- Freedom
- Finweb
- Hai Money
- Loan Studio
- Australian Asset Aggregation
- Port Group
- Mortgage Solutions Australia
Case Studies
Success stories of brokers who have benefited from sub aggregators can provide valuable insights. For instance, brokers who partnered with sub aggregators like Buyers Choice or Loan Studio have reported significant business growth and improved client satisfaction.
Challenges In The Sub Aggregator Landscape
Market Consolidation
The mortgage broking industry is experiencing market consolidation, with mergers and acquisitions reducing the number of independent sub aggregators. This consolidation can limit options for brokers and increase competition.
Navigating Regulations
Keeping up with changing financial regulations is a constant challenge. Sub aggregators must ensure they and their brokers comply with credit licensing requirements and other regulatory standards to avoid legal issues.
The Future of Sub Aggregators
Technological Advancements
As technology continues to evolve, sub aggregators are likely to integrate more advanced tools and platforms to support brokers. This includes the use of artificial intelligence for lead generation, data analytics for market insights, and enhanced CRM systems for better client management.
Increased Competition
With the rise of digital mortgage platforms, sub aggregators will face increased competition. To stay relevant, they will need to continuously innovate and offer unique value propositions to brokers.
Focus on Sustainability
Sustainability is becoming a significant focus in the financial industry. Sub aggregators may start to incorporate sustainable practices and offer green loan products to meet the growing demand for environmentally friendly options.
What Is An Aggregator In Mortgage Broking?
Overview
Aggregators are the backbone of the mortgage broking industry. They act as intermediaries between mortgage brokers and lenders, providing a platform that connects brokers with a wide range of loan products. This relationship is vital for brokers, as it allows them to offer their clients a variety of loan options without having to establish individual relationships with each lender.
Key Functions of Aggregators
Aggregators offer several essential services that make the loan origination process smoother and more efficient for brokers.
- Lead Generation Assistance: Aggregators often provide tools and resources to help brokers generate leads, ensuring a steady stream of potential clients.
- Cost Efficiency in Loan Origination: By pooling resources, aggregators can offer cost-effective solutions for loan origination, reducing the financial burden on individual brokers.
- Negotiation of Commission Terms with Lenders: Aggregators negotiate commission terms with lenders on behalf of brokers, often securing better rates than brokers could achieve independently.
Types of Aggregation Models
Aggregators typically operate under two primary models: the Commission Split Model and the Fee-Based Model.
- Commission Split Model: In this model, brokers share a percentage of their commission with the aggregator. For example, an 80/20 split means the broker keeps 80% of the commission while the aggregator takes 20%.
- Fee-Based Model: Here, brokers pay a monthly flat-rate fee to access the aggregator’s network of lenders. This model is particularly beneficial for high-volume brokers who can offset the flat fee with their earnings.
Conclusion
Summary of Key Points
Sub aggregators play a crucial role in the mortgage broking industry by providing training, support, and resources to brokers. They lower entry barriers, offer personalised attention, and facilitate business growth.
Future Outlook
The role of sub aggregators is likely to evolve with industry trends. As the mortgage broking landscape changes, sub aggregators will continue to adapt, providing essential support to brokers and helping them navigate new challenges.