Start-up Funding | |
Start-up Expenses to Fund | $20,050 |
Start-up Assets to Fund | $59,950 |
Total Funding Required | $80,000 |
Assets | |
Non-cash Assets from Start-up | $20,000 |
Cash Requirements from Start-up | $39,950 |
Additional Cash Raised | $0 |
Cash Balance on Starting Date | $39,950 |
Total Assets | $59,950 |
Liabilities and Capital | |
Liabilities | |
Current Borrowing | $0 |
Long-term Liabilities | $30,000 |
Accounts Payable (Outstanding Bills) | $10,000 |
Other Current Liabilities (interest-free) | $0 |
Total Liabilities | $40,000 |
Capital | |
Planned Investment | |
Investor 1 | $20,000 |
Investor 2 | $20,000 |
Additional Investment Requirement | $0 |
Total Planned Investment | $40,000 |
Loss at Start-up (Start-up Expenses) | ($20,050) |
Total Capital | $19,950 |
Total Capital and Liabilities | $59,950 |
Total Funding | $80,000 |
Our personal goal is to break through the barriers that impede homeownership for those who wish to realize the American Dream. We provide potential and current homeowners the opportunity to find the best mortgage loan for their needs.
We match buyers to loan programs. We have an extensive questionnaire for our buyers to list their wants and needs. We then take this questionnaire and put the supplied information to match buyers to the loan packages matching their criteria.
Due to the strengthening of the area’s economy and lower interest rates, more home buyers today are looking to purchase homes. These changes in attitudes of home buyers are a tremendous boost to real estate firms. Residential construction is booming in the city’s Old Town section. We are poised to take advantage of these changes, and expect to become a recognized name and profitable entity in the city’s real estate market. We chose to locate our office in the area of most revenue potential and where we have close connection to dominant real estate firms. Our targeted market area, the Old Town area, shows stability and growth. We have a beautiful office, centered in the Old Town area.
The first quarter home values were up 12.5 percent from the same period in 2001, the Office of Federal Housing Enterprise Oversight reported. The gain reflects an increase from the previous quarter, when residential real estate values saw growth of 12.1 percent.
The home buyers that Claremont Funding will be serving can be divided into two groups:
Market Analysis | |||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |||
Potential Customers | Growth | CAGR | |||||
First-Time Homeowners | 15% | 80,000 | 92,000 | 105,800 | 121,670 | 139,921 | 15.00% |
Residential Refinancing | 10% | 150,000 | 165,000 | 181,500 | 199,650 | 219,615 | 10.00% |
Other Home Buyers | 7% | 60,000 | 64,200 | 68,694 | 73,503 | 78,648 | 7.00% |
Total | 10.87% | 290,000 | 321,200 | 355,994 | 394,823 | 438,184 | 10.87% |
We cannot survive waiting for the customer to come to us. Instead, we must get better at focusing on the specific market segments whose needs match our offerings. Focusing on targeted segments is the key to our future. Therefore, we need to focus our marketing message and our services offered. We need to develop our message, communicate it, and make good on it.
Claremont Funding will focus on the mortgage broker needs in the Old Town section of the city and the surrounding areas. Our target customer will be first-time home buyers and existing homeowners who are interested in refinancing.
The following table and chart give a run-down on forecasted sales. We expect sales to build between January through March with the most growth during the months of March through August. We expect sales to drop off from September till the end of the year.
Sales Forecast | |||
Year 1 | Year 2 | Year 3 | |
Sales | |||
First-Time Homeowners | $104,672 | $150,000 | $180,000 |
Other Homebuyers | $52,336 | $75,000 | $90,000 |
Residential Refinancing | $107,839 | $140,000 | $175,000 |
Total Sales | $264,847 | $365,000 | $445,000 |
Direct Cost of Sales | Year 1 | Year 2 | Year 3 |
First-Time Homeowners | $0 | $0 | $0 |
Other Homebuyers | $0 | $0 | $0 |
Residential Refinancing | $0 | $0 | $0 |
Subtotal Direct Cost of Sales | $0 | $0 | $0 |
The accompanying table lists important program milestones, with dates and managers in charge, and budgets for each. The milestone schedule indicates our emphasis on planning for implementation.
Milestones | |||||
Milestone | Start Date | End Date | Budget | Manager | Department |
Lease Office Space | 12/15/2001 | 12/28/2001 | $3,000 | Maureen | Marketing |
Purchase Office Equipment/Computer, etc. | 12/1/2001 | 12/15/2001 | $3,000 | Maureen | Marketing |
Office Utilities | 12/20/2001 | 12/21/2001 | $250 | Joan | Web |
Answering Service | 12/13/2001 | 12/23/2001 | $200 | Joan | Web |
Stationary | 12/1/2001 | 12/10/2001 | $2,000 | Joan | Admin |
Business Software | 12/15/2001 | 12/28/2001 | $2,000 | Joan | Admin |
Advertising | 12/1/2001 | 12/30/2001 | $2,500 | Maureen | Marketing |
Totals | $12,950 |
Claremont Funding’s competitive edge is that both Joan and Maureen are the most visible lecturers to new home owners in the city. Joan has a weekly column in the city’s daily newspaper and Maureen lectures weekly to the city’s numerous neighborhood councils and civic groups. Together, they represent the most recognizable faces in the city on the subject of home ownership and refinancing a home.
Between them, they have a base of 6,000 satisfied customers who continue to make referrals to the brokers.
The city has been growing by 15% annually for the past 10 years. With the population now at 1.3 million, the new construction in the Old Town section of the city is valued at two billion dollars in home sales next year alone. Claremont Funding is positioned well to grab a large share of the mortgage services demanded by the city’s growth in Old Town.
Claremont Funding is a two member mortgage brokerage firm. Both brokers are equal partners in the firm.
The following table shows the personnel plan for Claremont Funding.
Personnel Plan | |||
Year 1 | Year 2 | Year 3 | |
Joan Billings | $60,000 | $80,000 | $90,000 |
Maureen Shoe | $60,000 | $80,000 | $90,000 |
Admin Assistants | $46,000 | $60,000 | $80,000 |
Total People | 3 | 4 | 4 |
Total Payroll | $166,000 | $220,000 | $260,000 |
The financial plan depends on important assumptions, most of which are shown in the following table as annual assumptions. The monthly assumptions are included in the appendix. From the beginning, we recognize that collection days are critical, but not a factor we can influence easily. At least we are planning on the problem, and dealing with it. Interest rates, tax rates, and personnel burden are based on conservative assumptions. Some of the more important underlying assumptions are:
General Assumptions | |||
Year 1 | Year 2 | Year 3 | |
Plan Month | 1 | 2 | 3 |
Current Interest Rate | 10.00% | 10.00% | 10.00% |
Long-term Interest Rate | 10.00% | 10.00% | 10.00% |
Tax Rate | 30.00% | 30.00% | 30.00% |
Other | 0 | 0 | 0 |
The following table and chart will summarize our break-even analysis.
Break-even Analysis | |
Monthly Revenue Break-even | $19,975 |
Assumptions: | |
Average Percent Variable Cost | 0% |
Estimated Monthly Fixed Cost | $19,975 |
Our projected profit and loss is shown on the following table.
Pro Forma Profit and Loss | |||
Year 1 | Year 2 | Year 3 | |
Sales | $264,847 | $365,000 | $445,000 |
Direct Cost of Sales | $0 | $0 | $0 |
Other Production Expenses | $0 | $0 | $0 |
Total Cost of Sales | $0 | $0 | $0 |
Gross Margin | $264,847 | $365,000 | $445,000 |
Gross Margin % | 100.00% | 100.00% | 100.00% |
Expenses | |||
Payroll | $166,000 | $220,000 | $260,000 |
Sales and Marketing and Other Expenses | $7,800 | $13,000 | $19,000 |
Depreciation | $0 | $0 | $0 |
Leased Equipment | $200 | $0 | $0 |
Utilities | $2,400 | $2,400 | $2,400 |
Insurance | $2,400 | $2,400 | $2,400 |
Rent | $36,000 | $36,000 | $36,000 |
Payroll Taxes | $24,900 | $33,000 | $39,000 |
Other | $0 | $0 | $0 |
Total Operating Expenses | $239,700 | $306,800 | $358,800 |
Profit Before Interest and Taxes | $25,147 | $58,200 | $86,200 |
EBITDA | $25,147 | $58,200 | $86,200 |
Interest Expense | $2,950 | $2,550 | $2,250 |
Taxes Incurred | $6,659 | $16,695 | $25,185 |
Net Profit | $15,538 | $38,955 | $58,765 |
Net Profit/Sales | 5.87% | 10.67% | 13.21% |
Cash flow projections are critical to our success. The annual cash flow figures are included here and the more important detailed monthly numbers are included in the appendix.
Pro Forma Cash Flow | |||
Year 1 | Year 2 | Year 3 | |
Cash Received | |||
Cash from Operations | |||
Cash Sales | $66,212 | $91,250 | $111,250 |
Cash from Receivables | $187,004 | $269,352 | $330,237 |
Subtotal Cash from Operations | $253,216 | $360,602 | $441,487 |
Additional Cash Received | |||
Sales Tax, VAT, HST/GST Received | $0 | $0 | $0 |
New Current Borrowing | $4,500 | $0 | $0 |
New Other Liabilities (interest-free) | $0 | $0 | $0 |
New Long-term Liabilities | $0 | $0 | $0 |
Sales of Other Current Assets | $0 | $0 | $0 |
Sales of Long-term Assets | $0 | $0 | $0 |
New Investment Received | $12,000 | $0 | $0 |
Subtotal Cash Received | $269,716 | $360,602 | $441,487 |
Expenditures | Year 1 | Year 2 | Year 3 |
Expenditures from Operations | |||
Cash Spending | $166,000 | $220,000 | $260,000 |
Bill Payments | $90,879 | $99,759 | $124,576 |
Subtotal Spent on Operations | $256,879 | $319,759 | $384,576 |
Additional Cash Spent | |||
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 |
Principal Repayment of Current Borrowing | $4,500 | $0 | $0 |
Other Liabilities Principal Repayment | $0 | $0 | $0 |
Long-term Liabilities Principal Repayment | $3,000 | $3,000 | $3,000 |
Purchase Other Current Assets | $0 | $0 | $0 |
Purchase Long-term Assets | $0 | $0 | $0 |
Dividends | $0 | $0 | $0 |
Subtotal Cash Spent | $264,379 | $322,759 | $387,576 |
Net Cash Flow | $5,337 | $37,842 | $53,911 |
Cash Balance | $45,287 | $83,129 | $137,040 |
The balance sheet in the following table shows managed but sufficient growth of net worth, and a sufficiently healthy financial position. The monthly estimates are included in the appendix.
Pro Forma Balance Sheet | |||
Year 1 | Year 2 | Year 3 | |
Assets | |||
Current Assets | |||
Cash | $45,287 | $83,129 | $137,040 |
Accounts Receivable | $11,631 | $16,030 | $19,543 |
Other Current Assets | $20,000 | $20,000 | $20,000 |
Total Current Assets | $76,918 | $119,159 | $176,583 |
Long-term Assets | |||
Long-term Assets | $0 | $0 | $0 |
Accumulated Depreciation | $0 | $0 | $0 |
Total Long-term Assets | $0 | $0 | $0 |
Total Assets | $76,918 | $119,159 | $176,583 |
Liabilities and Capital | Year 1 | Year 2 | Year 3 |
Current Liabilities | |||
Accounts Payable | $2,430 | $8,716 | $10,375 |
Current Borrowing | $0 | $0 | $0 |
Other Current Liabilities | $0 | $0 | $0 |
Subtotal Current Liabilities | $2,430 | $8,716 | $10,375 |
Long-term Liabilities | $27,000 | $24,000 | $21,000 |
Total Liabilities | $29,430 | $32,716 | $31,375 |
Paid-in Capital | $52,000 | $52,000 | $52,000 |
Retained Earnings | ($20,050) | ($4,512) | $34,443 |
Earnings | $15,538 | $38,955 | $58,765 |
Total Capital | $47,488 | $86,443 | $145,208 |
Total Liabilities and Capital | $76,918 | $119,159 | $176,583 |
Net Worth | $47,488 | $86,443 | $145,208 |
The following table provides important ratios for the industry, as determined by the Standard Industry Classification (SIC) Index, 7389, Business Services.
Ratio Analysis | ||||
Year 1 | Year 2 | Year 3 | Industry Profile | |
Sales Growth | 0.00% | 37.82% | 21.92% | 8.50% |
Percent of Total Assets | ||||
Accounts Receivable | 15.12% | 13.45% | 11.07% | 20.90% |
Other Current Assets | 26.00% | 16.78% | 11.33% | 55.70% |
Total Current Assets | 100.00% | 100.00% | 100.00% | 81.60% |
Long-term Assets | 0.00% | 0.00% | 0.00% | 18.40% |
Total Assets | 100.00% | 100.00% | 100.00% | 100.00% |
Current Liabilities | 3.16% | 7.31% | 5.88% | 48.20% |
Long-term Liabilities | 35.10% | 20.14% | 11.89% | 15.50% |
Total Liabilities | 38.26% | 27.46% | 17.77% | 63.70% |
Net Worth | 61.74% | 72.54% | 82.23% | 36.30% |
Percent of Sales | ||||
Sales | 100.00% | 100.00% | 100.00% | 100.00% |
Gross Margin | 100.00% | 100.00% | 100.00% | 0.00% |
Selling, General & Administrative Expenses | 94.18% | 89.41% | 86.91% | 82.60% |
Advertising Expenses | 2.27% | 2.74% | 3.37% | 0.60% |
Profit Before Interest and Taxes | 9.49% | 15.95% | 19.37% | 1.50% |
Main Ratios | ||||
Current | 31.65 | 13.67 | 17.02 | 1.57 |
Quick | 31.65 | 13.67 | 17.02 | 1.13 |
Total Debt to Total Assets | 38.26% | 27.46% | 17.77% | 63.70% |
Pre-tax Return on Net Worth | 46.74% | 64.38% | 57.81% | 1.90% |
Pre-tax Return on Assets | 28.86% | 46.70% | 47.54% | 5.20% |
Additional Ratios | Year 1 | Year 2 | Year 3 | |
Net Profit Margin | 5.87% | 10.67% | 13.21% | n.a |
Return on Equity | 32.72% | 45.06% | 40.47% | n.a |
Activity Ratios | ||||
Accounts Receivable Turnover | 17.08 | 17.08 | 17.08 | n.a |
Collection Days | 59 | 18 | 19 | n.a |
Accounts Payable Turnover | 34.28 | 12.17 | 12.17 | n.a |
Payment Days | 31 | 19 | 28 | n.a |
Total Asset Turnover | 3.44 | 3.06 | 2.52 | n.a |
Debt Ratios | ||||
Debt to Net Worth | 0.62 | 0.38 | 0.22 | n.a |
Current Liab. to Liab. | 0.08 | 0.27 | 0.33 | n.a |
Liquidity Ratios | ||||
Net Working Capital | $74,488 | $110,443 | $166,208 | n.a |
Interest Coverage | 8.52 | 22.82 | 38.31 | n.a |
Additional Ratios | ||||
Assets to Sales | 0.29 | 0.33 | 0.40 | n.a |
Current Debt/Total Assets | 3% | 7% | 6% | n.a |
Acid Test | 26.86 | 11.83 | 15.14 | n.a |
Sales/Net Worth | 5.58 | 4.22 | 3.06 | n.a |
Dividend Payout | 0.00 | 0.00 | 0.00 | n.a |
Sales Forecast | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Sales | |||||||||||||
First-Time Homeowners | 0% | $2,100 | $2,200 | $5,020 | $8,000 | $10,500 | $15,000 | $18,000 | $22,000 | $10,022 | $5,210 | $3,820 | $2,800 |
Other Homebuyers | 0% | $1,050 | $1,100 | $2,510 | $4,000 | $5,250 | $7,500 | $9,000 | $11,000 | $5,011 | $2,605 | $1,910 | $1,400 |
Residential Refinancing | 0% | $3,000 | $3,000 | $6,640 | $10,000 | $11,000 | $14,000 | $17,000 | $20,000 | $13,000 | $4,322 | $3,222 | $2,655 |
Total Sales | $6,150 | $6,300 | $14,170 | $22,000 | $26,750 | $36,500 | $44,000 | $53,000 | $28,033 | $12,137 | $8,952 | $6,855 | |
Direct Cost of Sales | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
First-Time Homeowners | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other Homebuyers | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Residential Refinancing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Direct Cost of Sales | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Personnel Plan | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Joan Billings | 0% | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 |
Maureen Shoe | 0% | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 |
Admin Assistants | 0% | $3,000 | $3,000 | $3,000 | $3,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $3,000 | $3,000 | $3,000 |
Total People | 3 | 3 | 3 | 3 | 4 | 4 | 4 | 4 | 4 | 3 | 3 | 3 | |
Total Payroll | $13,000 | $13,000 | $13,000 | $13,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $13,000 | $13,000 | $13,000 |
General Assumptions | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Plan Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |
Current Interest Rate | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | |
Long-term Interest Rate | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | |
Tax Rate | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | |
Other | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Pro Forma Profit and Loss | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Sales | $6,150 | $6,300 | $14,170 | $22,000 | $26,750 | $36,500 | $44,000 | $53,000 | $28,033 | $12,137 | $8,952 | $6,855 | |
Direct Cost of Sales | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other Production Expenses | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Cost of Sales | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Gross Margin | $6,150 | $6,300 | $14,170 | $22,000 | $26,750 | $36,500 | $44,000 | $53,000 | $28,033 | $12,137 | $8,952 | $6,855 | |
Gross Margin % | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% | |
Expenses | |||||||||||||
Payroll | $13,000 | $13,000 | $13,000 | $13,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $13,000 | $13,000 | $13,000 | |
Sales and Marketing and Other Expenses | $650 | $650 | $650 | $650 | $650 | $650 | $650 | $650 | $650 | $650 | $650 | $650 | |
Depreciation | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Leased Equipment | $200 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Utilities | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | |
Insurance | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | |
Rent | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | |
Payroll Taxes | 15% | $1,950 | $1,950 | $1,950 | $1,950 | $2,250 | $2,250 | $2,250 | $2,250 | $2,250 | $1,950 | $1,950 | $1,950 |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Operating Expenses | $19,200 | $19,000 | $19,000 | $19,000 | $21,300 | $21,300 | $21,300 | $21,300 | $21,300 | $19,000 | $19,000 | $19,000 | |
Profit Before Interest and Taxes | ($13,050) | ($12,700) | ($4,830) | $3,000 | $5,450 | $15,200 | $22,700 | $31,700 | $6,733 | ($6,863) | ($10,048) | ($12,145) | |
EBITDA | ($13,050) | ($12,700) | ($4,830) | $3,000 | $5,450 | $15,200 | $22,700 | $31,700 | $6,733 | ($6,863) | ($10,048) | ($12,145) | |
Interest Expense | $248 | $246 | $244 | $279 | $277 | $275 | $235 | $233 | $231 | $229 | $227 | $225 | |
Taxes Incurred | ($3,989) | ($3,884) | ($1,522) | $816 | $1,552 | $4,478 | $6,739 | $9,440 | $1,951 | ($2,128) | ($3,083) | ($3,711) | |
Net Profit | ($9,309) | ($9,062) | ($3,552) | $1,905 | $3,621 | $10,448 | $15,725 | $22,027 | $4,551 | ($4,965) | ($7,193) | ($8,659) | |
Net Profit/Sales | -151.36% | -143.84% | -25.06% | 8.66% | 13.54% | 28.62% | 35.74% | 41.56% | 16.24% | -40.90% | -80.35% | -126.32% |
Pro Forma Cash Flow | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Cash Received | |||||||||||||
Cash from Operations | |||||||||||||
Cash Sales | $1,538 | $1,575 | $3,543 | $5,500 | $6,688 | $9,125 | $11,000 | $13,250 | $7,008 | $3,034 | $2,238 | $1,714 | |
Cash from Receivables | $0 | $154 | $4,616 | $4,922 | $10,823 | $16,619 | $20,306 | $27,563 | $33,225 | $39,126 | $20,627 | $9,023 | |
Subtotal Cash from Operations | $1,538 | $1,729 | $8,159 | $10,422 | $17,511 | $25,744 | $31,306 | $40,813 | $40,233 | $42,160 | $22,865 | $10,737 | |
Additional Cash Received | |||||||||||||
Sales Tax, VAT, HST/GST Received | 0.00% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
New Current Borrowing | $0 | $0 | $0 | $4,500 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Other Liabilities (interest-free) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Long-term Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Sales of Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Sales of Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Investment Received | $0 | $0 | $12,000 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Received | $1,538 | $1,729 | $20,159 | $14,922 | $17,511 | $25,744 | $31,306 | $40,813 | $40,233 | $42,160 | $22,865 | $10,737 | |
Expenditures | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Expenditures from Operations | |||||||||||||
Cash Spending | $13,000 | $13,000 | $13,000 | $13,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $13,000 | $13,000 | $13,000 | |
Bill Payments | $10,082 | $2,455 | $2,441 | $4,801 | $7,130 | $8,226 | $11,127 | $13,365 | $15,724 | $8,336 | $4,070 | $3,124 | |
Subtotal Spent on Operations | $23,082 | $15,455 | $15,441 | $17,801 | $22,130 | $23,226 | $26,127 | $28,365 | $30,724 | $21,336 | $17,070 | $16,124 | |
Additional Cash Spent | |||||||||||||
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Principal Repayment of Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $4,500 | $0 | $0 | $0 | $0 | $0 | |
Other Liabilities Principal Repayment | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Long-term Liabilities Principal Repayment | $250 | $250 | $250 | $250 | $250 | $250 | $250 | $250 | $250 | $250 | $250 | $250 | |
Purchase Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Purchase Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Dividends | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Spent | $23,332 | $15,705 | $15,691 | $18,051 | $22,380 | $23,476 | $30,877 | $28,615 | $30,974 | $21,586 | $17,320 | $16,374 | |
Net Cash Flow | ($21,794) | ($13,977) | $4,468 | ($3,129) | ($4,869) | $2,267 | $430 | $12,198 | $9,260 | $20,574 | $5,546 | ($5,637) | |
Cash Balance | $18,156 | $4,179 | $8,647 | $5,518 | $649 | $2,916 | $3,346 | $15,544 | $24,803 | $45,378 | $50,923 | $45,287 |
Pro Forma Balance Sheet | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Assets | Starting Balances | ||||||||||||
Current Assets | |||||||||||||
Cash | $39,950 | $18,156 | $4,179 | $8,647 | $5,518 | $649 | $2,916 | $3,346 | $15,544 | $24,803 | $45,378 | $50,923 | $45,287 |
Accounts Receivable | $0 | $4,613 | $9,184 | $15,195 | $26,773 | $36,013 | $46,769 | $59,463 | $71,650 | $59,450 | $29,427 | $15,513 | $11,631 |
Other Current Assets | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 |
Total Current Assets | $59,950 | $42,768 | $33,363 | $43,842 | $52,291 | $56,661 | $69,685 | $82,808 | $107,194 | $104,253 | $94,804 | $86,437 | $76,918 |
Long-term Assets | |||||||||||||
Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Accumulated Depreciation | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Assets | $59,950 | $42,768 | $33,363 | $43,842 | $52,291 | $56,661 | $69,685 | $82,808 | $107,194 | $104,253 | $94,804 | $86,437 | $76,918 |
Liabilities and Capital | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Current Liabilities | |||||||||||||
Accounts Payable | $10,000 | $2,377 | $2,283 | $4,564 | $6,859 | $7,858 | $10,684 | $12,832 | $15,441 | $8,199 | $3,965 | $3,040 | $2,430 |
Current Borrowing | $0 | $0 | $0 | $0 | $4,500 | $4,500 | $4,500 | $0 | $0 | $0 | $0 | $0 | $0 |
Other Current Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Subtotal Current Liabilities | $10,000 | $2,377 | $2,283 | $4,564 | $11,359 | $12,358 | $15,184 | $12,832 | $15,441 | $8,199 | $3,965 | $3,040 | $2,430 |
Long-term Liabilities | $30,000 | $29,750 | $29,500 | $29,250 | $29,000 | $28,750 | $28,500 | $28,250 | $28,000 | $27,750 | $27,500 | $27,250 | $27,000 |
Total Liabilities | $40,000 | $32,127 | $31,783 | $33,814 | $40,359 | $41,108 | $43,684 | $41,082 | $43,441 | $35,949 | $31,465 | $30,290 | $29,430 |
Paid-in Capital | $40,000 | $40,000 | $40,000 | $52,000 | $52,000 | $52,000 | $52,000 | $52,000 | $52,000 | $52,000 | $52,000 | $52,000 | $52,000 |
Retained Earnings | ($20,050) | ($20,050) | ($20,050) | ($20,050) | ($20,050) | ($20,050) | ($20,050) | ($20,050) | ($20,050) | ($20,050) | ($20,050) | ($20,050) | ($20,050) |
Earnings | $0 | ($9,309) | ($18,371) | ($21,922) | ($20,018) | ($16,397) | ($5,949) | $9,776 | $31,803 | $36,354 | $31,389 | $24,197 | $15,538 |
Total Capital | $19,950 | $10,641 | $1,579 | $10,028 | $11,932 | $15,553 | $26,001 | $41,726 | $63,753 | $68,304 | $63,339 | $56,147 | $47,488 |
Total Liabilities and Capital | $59,950 | $42,768 | $33,363 | $43,842 | $52,291 | $56,661 | $69,685 | $82,808 | $107,194 | $104,253 | $94,804 | $86,437 | $76,918 |
Net Worth | $19,950 | $10,641 | $1,579 | $10,028 | $11,932 | $15,553 | $26,001 | $41,726 | $63,753 | $68,304 | $63,339 | $56,147 | $47,488 |
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If you want to start a Mortgage Broker business or expand your current Mortgage Broker business, you need a business plan.
The following Mortgage Broker business plan template gives you the key elements to include in a winning loan officer business plan.
You can download our business plan template (including a full, customizable financial model) to your computer here.
I. executive summary, business overview.
[Company Name], located IN [insert location here] is a new mortgage brokerage specializing in residential mortgages. The company will operate in a professional setting, conveniently located next to [notable bank] in the center of the shopping district. [Company Name] is headed by [Founder’s Name], an MBA Graduate from XYZ University with 20 years of experience working as in the finance industry.
[Company Name] will focus on superior service for its clients. [Company’s Name] services include finding loan options, applying for loans on behalf of customers, and completing closing paperwork. It has a full-time assistant who, among other things, will manage the company website, coordinate scheduling, and answering basic client questions.
The founder, [Founder’s Name], will also focus on meeting his clientele’s needs. In addition to keeping in touch with past clients after they have closed on the mortgage, [Founder’s Name] will hold webinars for the community and potential clients on the mortgage lending process and securing the best mortgage for each budget and property type.
Customer Focus
[Company Name] will primarily serve homebuyers and commercial real estate clients interested in properties within a 10-mile radius of our location. The demographics of residents in this area are as follows:
These residents include 20% renters and 80% homeowners. Furthermore, [Company Name] will seek contacts with real estate agents in order to develop long-term relationships.
Management Team
[Company Name]’s most valuable asset is the expertise and experience of its founder, [Founder’s Name]. [First name] has been a licensed mortgage broker for the past 20 years. He has spent much of his career working at LendingTree. There he specialized in commercial loans for 5 years before moving to specialize in home mortgages for the next 10 years.
[Company Name] will also employ an experienced assistant to help with various administrative duties around the office. [Assistant’s name] has experience working with C-level executives and has spent significant time as an administrator.
[Company Name] is uniquely qualified to succeed due to the following reasons:
[Company Name] is seeking a total funding of $100,000 of debt capital to open its office. The capital will be used for funding capital expenditures and location build-out, hiring initial employees, marketing expenses and working capital.
Specifically, these funds will be used as follows:
Top line projections over the next five years are as follows:
Financial Summary | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
---|---|---|---|---|---|
Revenue | $965,742 | $1,878,611 | $2,718,300 | $3,477,900 | $4,285,228 |
Total Expenses | $390,241 | $630,018 | $931,935 | $1,171,906 | $1,429,992 |
EBITDA | $575,501 | $1,248,593 | $1,786,365 | $2,305,994 | $2,855,237 |
Depreciation | $8,720 | $8,720 | $8,720 | $8,720 | $8,720 |
EBIT | $566,781 | $1,239,873 | $1,777,645 | $2,297,274 | $2,846,517 |
Interest | $5,077 | $4,442 | $3,807 | $3,173 | $2,538 |
PreTax Income | $561,705 | $1,235,431 | $1,773,838 | $2,294,101 | $2,843,978 |
Income Tax Expense | $196,597 | $432,401 | $620,843 | $802,935 | $995,392 |
Net Income | $365,108 | $803,030 | $1,152,995 | $1,491,166 | $1,848,586 |
Net Profit Margin | 38% | 43% | 42% | 43% | 43% |
You can download our Mortgage Broker Business Plan Template (including a full, customizable financial model) to your computer here.
[Company Name], located at [insert location here] is a new mortgage brokerage specializing in residential mortgages. The company will operate in a professional setting, conveniently located next to [notable bank] in the center of the shopping district. [Company Name] is headed by [Founder’s Name], an MBA Graduate from XYZ University with 20 years of experience working as a mortgage broker.
While [Founder’s Name] has been in the mortgage brokerage business for some time, it was in [month, year] that he decided to launch [Company Name]. Specifically, during this time, [Founder] met with a former friend and fellow independent mortgage broker in Fort Lauderdale, FL who has had tremendous success. After discussing the business at length, [Founder’s Name] clearly understood that a similar business would enjoy significant success in his hometown.
Specifically, the customer demographics and competitive situations in the Fort Lauderdale location and in his hometown were so similar that he knew the business would work. After surveying the local population, [Founder’s name] went ahead and founded [Company Name].
Upon returning from Fort Lauderdale, surveying the local customer base, and finding a potential office, [Founder’s Name] incorporated [Company Name] as an S-Corporation on [date of incorporation].
The business is currently being run out of [Founder’s Name] home office, but once the lease on [Company Name]’s office location is finalized, all operations will be run from there.
Since incorporation, the Company has achieved the following milestones:
[Founder’s Name] will offer the following services:
As [Founder’s Name] understands, the key to a successful mortgage brokerage is building referrals and a long-term reputation as a trustworthy agent in the community. [Founder’s Name] will continue to reach out to past clients in future years to answer questions and to continue to develop a relationship.
Last year, U.S. mortgage brokerages brought in revenues of $11.5 billion and employed 47,000 people. There were just over 12,000 businesses in this market. The Mortgage Brokers industry is highly fragmented, with the top two companies accounting for just over 11% of industry revenue. Key players in the American mortgage broker industry include LendingTree, and HomeServices of America.
Major revenue streams of the industry include: The bulk of brokerage fees and commissions come from residential mortgages, and the remaining revenue comes from brokerage fees and commissions on nonresidential mortgages and loans, and mortgage broker consulting fees.
A recent study commissioned by the Mortgage Bankers Association found that: Except for very large firms, modest economies of scale persist throughout almost the entire range of output… while average firm size is increasing, many mortgage broker firms are too small to take full advantage of the cost reductions possible with a larger scale of operation. Equally important, large firms do not command a competitive advantage over smaller firms, as far as unit costs are concerned.This bodes well for a small firm starting out with experienced leadership.
Demographic profile of target market.
[Company Name] will primarily serve the residents of [company location].
The area we serve has a significant population of young professionals, who have yet to purchase their first home.
The precise demographics of the town in which our business is based are as follows:
Wilmette | Winnetka | |
---|---|---|
Total Population | 26,097 | 10,725 |
Square Miles | 6.89 | 3.96 |
Population Density | 3,789.20 | 2,710.80 |
Population Male | 48.04% | 48.84% |
Population Female | 51.96% | 51.16% |
Target Population by Age Group | ||
Age 18-24 | 3.68% | 3.52% |
Age 25-34 | 5.22% | 4.50% |
Age 35-44 | 13.80% | 13.91% |
Age 45-54 | 18.09% | 18.22% |
Target Population by Income | ||
Income $50,000 to $74,999 | 11.16% | 6.00% |
Income $75,000 to $99,999 | 10.91% | 4.41% |
Income $100,000 to $124,999 | 9.07% | 6.40% |
Income $125,000 to $149,999 | 9.95% | 8.02% |
Income $150,000 to $199,999 | 12.20% | 11.11% |
Income $200,000 and Over | 32.48% | 54.99% |
The Company will primarily target the following four customer segments:
Direct & indirect competitors.
The following residential mortgage brokerages are located within a 20 mile radius of [Company Name], thus providing either direct or indirect competition for customers:
The Loan Store
Established in 2010, The Loan Store originates, finances, and sells mortgage and nonmortgage lending products in the United States. It offers a range of consumer credit products, such as home loan products; home equity loans; and unsecured personal loans, as well as home and personal loan servicing. The company claims to be one of the largest private, independent retail mortgage lender in the U.S. Its current business channels include direct lending, affinity, branch retail and servicing.
However, agents working with The Loan Store experience high turnover, resulting in little concern for maintaining ongoing relationships with clients. Also, the agents themselves are mixed in quality, ranging from part-time brokers with little experience or sales records to full-time brokers with long-term experience. There is no systematic company method for passing on knowledge from experienced to inexperienced brokers as all are competing with each other, to a certain extent, for commissions.
Direct Loan Connection
Founded in 2006, Direct Loan Connection (DLC) employs licensed mortgage professionals who have access to multiple lending institutions, including banks, credit unions and trust companies. This access enables the company to offer a vast array of available mortgage products – ranging from first-time homebuyer programs to financing for the self-employed to financing for those with credit blemishes. In addition to help for homebuyers and homeowners, Dominion offers commercial mortgages.
Unlike [Company Name], DLC operates with a smaller number of transactions each year due to the higher commissions they earn on each. They refuse to negotiate on their broker’s fees, and sometimes lose potential clients because of this. However, for the premium end of the market, they are the local leader.
Supreme Mortgage
Supreme Mortgage specializes in mortgage brokering, and is committed to helping homebuyers and homeowners the best mortgage with the lowest mortgage interest rate. The brokerage works with more than 40 lenders who compete to provide mortgages, and who pay Supreme Mortgage’s fee so that clients receive the service free of charge.
Some reviews of Supreme Mortgage point out the low quality service offered by brokers, who have little training in customer service. Furthermore, Supreme Mortgage does not attempt to maintain long-term relationships with customers who will eventually purchase another home.
[Company Name] enjoys several advantages over its competitors. These advantages include:
[Company name] will use several strategies to promote its name and develop its brand. By using an integrated marketing strategy, [Company Name] will win clients and develop consistent revenue streams.
The [Company name] brand will focus on the Company’s unique value proposition:
Targeted Cold Calls
[Company name] will initially invest significant time and energy into contacting potential clients via telephone. In order to improve the effectiveness of this phase of the marketing strategy, a highly-focused call list will be used, targeting households throughout the area. As this is a very time-consuming process, it will primarily be used during the startup phase to build an initial client base.
[Company name] understands that the best promotion comes from satisfied customers. The Company will work to partner with local realtors by providing economic or financial incentives for every new client produced. This strategy will increase in effectiveness after the business has already been established.
Additionally, [company name] will aggressively network with useful sources such as home contractors, property development companies, and businesses which import employees from other areas of the country and nations. This network will generate qualified referral leads.
[Company name] will invest resources in two forms of geographically-focused internet promotion—organic search engine optimization and pay-per-click advertising. The Company will develop its website in such a manner as to direct as much traffic from search engines as possible. Additionally, it will use highly-focused, specific keywords to draw traffic to its website, where potential clients will find a content-rich site that presents [Company name] as the trustworthy, well-qualified mortgage brokerage that it is.
Publications
[Company name] will advertise its services in key local publications, including newspapers, area magazines, and its own newsletter. Additionally, the Company will print brochures and place them in specific locations frequented by target individuals, such as small business development centers and real estate offices.
By offering seminars on topics of interest in the office or other locations, [Founder’s Name] will encourage residents in the community to become comfortable with the expertise and character of [Company Name]. These seminars will generally be offered free of charge as general promotion and for direct networking.
[Company Name]’s pricing will rely on the standard industry rates in order to be perceived as neither a luxury nor a discount broker. The standard rate for brokering a mortgage is 1-2% of the loan amount. By seeking quality clients and maintaining long-term relationships with them, [Company Name] will fend off pressure to discount their rates, even in down markets.
[Company Name] will carry out its day-to-day operations primarily on an appointment basis. Prospective homebuyers will make appointments to begin the preapproval process and to discuss their needs. These will primarily occur via telephone or email, although some discussions may be held in the office’s meeting room.
[Founder’s Name] will work on an as-needed basis. This includes weekends, which are a prime time for real estate transactions, and will generally take days off on weekdays. The company will also employ an administrative assistant who will also support marketing and client relationship development efforts and will be present on weekdays on a regular 9 AM – 5 PM schedule.
Company name]’s long term goal is to become the number-one name in residential mortgage brokering in terms of the right balance of mortgage options, rates, and customer service quality. We seek to do this by ensuring customer satisfaction and developing a loyal and trusting clientele.
The following are a series of steps that will lead to this long-term success. [Company Name] expects to achieve the following milestones in the following [xyz] months:
Date | Milestone |
---|---|
[Date 1] | Finalize lease agreement |
[Date 2] | Design and build out [Company Name] office |
[Date 3] | Hire and train initial staff |
[Date 4] | Kickoff of promotional campaign |
[Date 5] | Reach break-even |
[Date 6] | Reach XXX ongoing clients |
[Company Name]’s most valuable asset is the expertise and experience of its founder, [Founder’s Name]. [First name] has been a licensed mortgage broker for the past 20 years. He has spent much of his career working at LendingTree. There he specialized in commercial loans for 5 years before moving to specialize in home mortgages for the next 10 years. [Founder’s Name] maintains his mortgage broker license in the state of [state] as well as the states of [other states].
[Founder’s Name] will serve as the company CEO and president. In order to launch the business we do not need additional personnel beyond the assistant who has already been recruited, but will hire the following in the future:
Revenue and cost drivers.
[Company Name]’s revenues will come primarily from the commissions earned from residential mortgage sales. 80% of the deals each quarter are expected to be residential mortgages, and 20% business loans.
As with most services, labor expenses will be key cost drivers. [Founder’s Name] and future brokers will earn a competitive base salary. Furthermore, the costs of transactions are projected to be roughly 40% of regular commission revenue and cover advertising, and other direct costs for each deal.
Moreover, ongoing marketing expenditures are also notable cost drivers for [Company Name].
Key assumptions & forecasts.
The following table reflects the key revenue and cost assumptions made in the financial model.
Clients per Quarter | Average |
---|---|
FY 1 | 15 |
FY 2 | 21 |
FY 3 | 30 |
FY 4 | 36 |
FY 5 | 45 |
Annual Lease/rent ( per location) | $50,000 |
5 Year Annual Income Statement
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
---|---|---|---|---|---|---|
Revenues | ||||||
Product/Service A | $151,200 | $333,396 | $367,569 | $405,245 | $446,783 | |
Product/Service B | $100,800 | $222,264 | $245,046 | $270,163 | $297,855 | |
Total Revenues | $252,000 | $555,660 | $612,615 | $675,408 | $744,638 | |
Expenses & Costs | ||||||
Cost of goods sold | $57,960 | $122,245 | $122,523 | $128,328 | $134,035 | |
Lease | $60,000 | $61,500 | $63,038 | $64,613 | $66,229 | |
Marketing | $20,000 | $25,000 | $25,000 | $25,000 | $25,000 | |
Salaries | $133,890 | $204,030 | $224,943 | $236,190 | $248,000 | |
Other Expenses | $3,500 | $4,000 | $4,500 | $5,000 | $5,500 | |
Total Expenses & Costs | $271,850 | $412,775 | $435,504 | $454,131 | $473,263 | |
EBITDA | ($19,850) | $142,885 | $177,112 | $221,277 | $271,374 | |
Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 | |
EBIT | ($56,810) | $105,925 | $140,152 | $184,317 | $234,414 | |
Interest | $23,621 | $20,668 | $17,716 | $14,763 | $11,810 | |
PRETAX INCOME | ($80,431) | $85,257 | $122,436 | $169,554 | $222,604 | |
Net Operating Loss | ($80,431) | ($80,431) | $0 | $0 | $0 | |
Income Tax Expense | $0 | $1,689 | $42,853 | $59,344 | $77,911 | |
NET INCOME | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 | |
Net Profit Margin (%) | - | 15.00% | 13.00% | 16.30% | 19.40% |
5 Year Annual Balance Sheet
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
---|---|---|---|---|---|---|
ASSETS | ||||||
Cash | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 | |
Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
Inventory | $21,000 | $23,153 | $25,526 | $28,142 | $31,027 | |
Total Current Assets | $37,710 | $113,340 | $184,482 | $286,712 | $423,416 | |
Fixed assets | $246,450 | $246,450 | $246,450 | $246,450 | $246,450 | |
Depreciation | $36,960 | $73,920 | $110,880 | $147,840 | $184,800 | |
Net fixed assets | $209,490 | $172,530 | $135,570 | $98,610 | $61,650 | |
TOTAL ASSETS | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 | |
LIABILITIES & EQUITY | ||||||
Debt | $317,971 | $272,546 | $227,122 | $181,698 | $136,273 | |
Accounts payable | $9,660 | $10,187 | $10,210 | $10,694 | $11,170 | |
Total Liabilities | $327,631 | $282,733 | $237,332 | $192,391 | $147,443 | |
Share Capital | $0 | $0 | $0 | $0 | $0 | |
Retained earnings | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
Total Equity | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
TOTAL LIABILITIES & EQUITY | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 |
5 Year Annual Cash Flow Statement
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
---|---|---|---|---|---|
CASH FLOW FROM OPERATIONS | |||||
Net Income (Loss) | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 |
Change in working capital | ($11,340) | ($1,625) | ($2,350) | ($2,133) | ($2,409) |
Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 |
Net Cash Flow from Operations | ($54,811) | $118,902 | $114,193 | $145,037 | $179,244 |
CASH FLOW FROM INVESTMENTS | |||||
Investment | ($246,450) | $0 | $0 | $0 | $0 |
Net Cash Flow from Investments | ($246,450) | $0 | $0 | $0 | $0 |
CASH FLOW FROM FINANCING | |||||
Cash from equity | $0 | $0 | $0 | $0 | $0 |
Cash from debt | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
Net Cash Flow from Financing | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
SUMMARY | |||||
Net Cash Flow | $16,710 | $73,478 | $68,769 | $99,613 | $133,819 |
Cash at Beginning of Period | $0 | $16,710 | $90,188 | $158,957 | $258,570 |
Cash at End of Period | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 |
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If you’re looking for a comprehensive, easy-to-follow guide to launching and growing a successful mortgage brokerage business, you've come to the right place. The #1 Mortgage Brokerage Business Plan Template & Guidebook provides the information and tools you need to create a comprehensive, professional business plan for your mortgage brokerage. With this guide, you'll have the knowledge and confidence to attract investors, secure funding and succeed in the competitive world of mortgage brokerage.
Get worry-free services and support to launch your business starting at $0 plus state fees.
1. describe the purpose of your mortgage brokerage business..
The first step to writing your business plan is to describe the purpose of your mortgage brokerage business. This includes describing why you are starting this type of business, and what problems it will solve for customers. This is a quick way to get your mind thinking about the customers’ problems. It also helps you identify what makes your business different from others in its industry.
It also helps to include a vision statement so that readers can understand what type of company you want to build.
Here is an example of a purpose mission statement for a mortgage brokerage business:
Our mission at [Mortgage Brokerage] is to offer the highest level of financial advice and guidance to our clients, helping them to achieve their goals and promote long-term financial stability. We strive to create an environment of trust, respect, and integrity, and to provide every client with an individualized mortgage solution tailored to their specific needs. We are committed to providing exceptional customer service and delivering a positive customer experience throughout the loan process.
The next step is to outline your products and services for your mortgage brokerage business.
When you think about the products and services that you offer, it's helpful to ask yourself the following questions:
You may want to do a comparison of your business plan against those of other competitors in the area, or even with online reviews. This way, you can find out what people like about them and what they don’t like, so that you can either improve upon their offerings or avoid doing so altogether.
If you don't have a marketing plan for your mortgage brokerage business, it's time to write one. Your marketing plan should be part of your business plan and be a roadmap to your goals.
A good marketing plan for your mortgage brokerage business includes the following elements:
Next, you'll need to build your operational plan. This section describes the type of business you'll be running, and includes the steps involved in your operations.
In it, you should list:
The second part of your mortgage brokerage business plan is to develop a management and organization section.
This section will cover all of the following:
This section should be broken down by month and year. If you are still in the planning stage of your business, it may be helpful to estimate how much money will be needed each month until you reach profitability.
Typically, expenses for your business can be broken into a few basic categories:
Startup Costs
Startup costs are typically the first expenses you will incur when beginning an enterprise. These include legal fees, accounting expenses, and other costs associated with getting your business off the ground. The amount of money needed to start a mortgage brokerage business varies based on many different variables, but below are a few different types of startup costs for a mortgage brokerage business.
Running & Operating Costs
Running costs refer to ongoing expenses related directly with operating your business over time like electricity bills or salaries paid out each month. These types of expenses will vary greatly depending on multiple variables such as location, team size, utility costs, etc.
Marketing & Sales Expenses
You should include any costs associated with marketing and sales, such as advertising and promotions, website design or maintenance. Also, consider any additional expenses that may be incurred if you decide to launch a new product or service line. For example, if your mortgage brokerage business has an existing website that needs an upgrade in order to sell more products or services, then this should be listed here.
A financial plan is an important part of any business plan, as it outlines how the business will generate revenue and profit, and how it will use that profit to grow and sustain itself. To devise a financial plan for your mortgage brokerage business, you will need to consider a number of factors, including your start-up costs, operating costs, projected revenue, and expenses.
Here are some steps you can follow to devise a financial plan for your mortgage brokerage business plan:
Why do you need a business plan for a mortgage brokerage business.
A business plan is a fundamental tool for the success of a mortgage brokerage business. It outlines business goals, strategies and tactics, financial projections, and provides potential investors with an analysis of the expected returns over time. It also serves as a roadmap for the business owner to follow and helps identify potential risks and opportunities. Additionally, banks and other lenders often require aspiring entrepreneurs to have a comprehensive business plan in order to qualify for financing.
You should ask for help with your mortgage brokerage business plan from a local small business advisor or accountant. You could also contact a local Small Business Development Center (SBDC) for guidance on developing a business plan.
Yes, it is possible to write a mortgage brokerage business plan yourself. Depending on the scope of the business plan, it may be necessary to obtain specialized financial information and advice from an accountant, lawyer or other qualified professional. Additionally, there are many resources available online that can provide guidance on how to write a successful business plan.
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It’s a never-ending battle to come up with new ways to improve the company. Corporate think tanks conduct extensive market research to assist executives in making important decisions. Report documents are always on people’s desks, urging them to make changes. With all of the facts and figures in hand, planning begins to ensure that the present and future situations are under control. Consider the mortgage broker business, which is always looking for new ways to increase profits, gain more partners, improve their small marketing strategies , and even expand to serve more people. Also, make sure that planning will never stop in your industry.
1. mortgage broker business plan template.
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A sample business plan contains a list of guidelines and processes that assist businesses in achieving their goals. Some business plans are in place for years, while others are only in place for a few months. Mortgage business plans follow the same path but with more specifics. The strategy focuses on methods and systems that make mortgage programs, projects, and proposals relevant to the target market—homebuyers and property investors . The primary goal of most mortgage business plans is to increase sales while reducing losses.
Being a mortgage broker entails being in the thick of the transaction. You have clients or customers on the one hand and lending companies on the other. The lending agencies could be a commercial real estate company or a bank that makes bank loans. Additionally, as a broker, you serve as a convenient intermediary. Therefore, begin by presenting your business plan to agencies by following the simple steps outlined below.
When you know who you’re dealing with, you’ll be able to make property investments and get financial assistance. You can change your plans depending on the nature of the institution, whether it’s a local bank, a rental property agency, or a real estate company. Make sure you understand their process so you can properly align your comprehensive proposals .
Any business suffers from chaotic and incomprehensible branding. If your customers and viewers are unclear about the purpose of your advertisement or the contents of your website, you will lose credibility and, unfortunately, audiences. So, plan and develop a well-organized and professional brand for your company. Before your launch dates, choose your color palettes and create your logo. Then, using the selected color patterns as a guide, create alternate outputs. When creating flyers or leaflets, make sure that the advertising materials have a specific direction.
Each marketing strategy and advertising campaign serves as the super-strong thread that connects the business plan. These strategies—approaches that mortgage businesses must adhere to are the business’s driving force. Through these concepts, companies gain a clear understanding of the path forward for the enterprise’s development. However, keep in mind that the marketing and advertising strategies chosen for the business plan should align with the company’s vision.
An impossible plan isn’t worth making, and it’s certainly not worth sharing. You may have objectives, but keep both feet on the ground so that the implementation phase is the next priority. You can either run a feasibility test or give it a dose of common sense. Your ideas must produce results, and the best course of action is to make them feasible. Whether it’s a strategic plan or an action plan , your company deserves to know where it’s going. Don’t forget to set aside time to plan for improvement and betterment, as this will benefit everyone.
During the recession, many brokers were forced to close their doors. Many people declared mortgage brokers to be a dying breed. Today, however, reality contradicts them. Brokers are becoming increasingly important in the housing market because they bridge the consumer and the appropriate lending institution gap.
When shopping for a loan, you’ll come across a dozen different types of mortgage fees — and sometimes even more. Most of them, however, can be negotiated by asking for a lower price or a waiver.
For three years, a broker must retain copies of all documents relating to transactions, trust accounts, and other documents executed or obtained in connection with any transaction requiring a broker’s license.
A mortgage company requires a foolproof and efficient business plan in addition to hard work and dedication. Businesses must set goals, objectives, and standards to ensure proper management sample. In some ways, business plans serve as a blueprint for how to run a company. Companies should use this information to create a business plan that fits their needs and proposed end goals. Have you gained any insight from the advice given above? So, what exactly are you waiting for? Now is the time to get the templates !
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Finding innovative ways to improve the business is a constant ordeal. You have corporate think tanks doing their substantial analysis about the market to help the executives create big decisions. Report documents are always on the desks that will urge the need for changes. With all the facts and figures, planning steps in to ascertain control of both the present and future situations. Think of the mortgage broker business trying their best to find ways to maximize the profits, acquire more partners, enhance their small marketing strategies, and even expand to cater more people. And make sure that in your industry, planning will never cease.
Step 2: specify a target, step 3: create an outline, step 4: set a time table, step 5: make it doable, more in mortgage templates.
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Do you want to be a financial professional who works like an agent between borrowers looking for mortgages and the institutions that offer them? As a mortgage broker, your job is to find a lender that provides a program that is really appropriate for the borrower’s needs. You will be working with a number of lenders. 65% of borrowers use a mortgage broker to secure a home loan according to the National Association of Realtors. In this article, we will discuss the importance and beneficial steps of creating a mortgage broker business plan, plus we have a wide array of downloadable business plan templates for you to use. Keep on reading!
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If you decide to enter the mortgage business , the best thing you need to do is create a business plan. Any professional who wants to start their own business prioritizes having a comprehensive plan that can help them achieve their business goals and objectives. If you’re serious and determined as a mortgage broker, your business plan is the best tool to attract lenders.
Establishing a solid plan will help you to be able to provide an appealing business image to the lender and you may also have the opportunity to indicate your future plans and the overall achievements of your business.
Also, you need to be able to create a persuasive business plan. So, we suggest that you use our templates above that you can use comfortably. Here are the steps that you can do after you download your selected template:
In writing a compelling introduction, you need to build your trustworthiness to your reader. Explain thoroughly and in a creative way why you are reaching out to the lender. Your introduction should have the legal structure of the business. Indicate your personal experience, samples of past achievements, and many more. Include a good mission statement as it clearly determines the road your company will take. It lets your prospect clients be able to know what you stand for and what you want to accomplish in your mortgage business.
Show how your business is funded by indicating the essential financial information of your company. Of course, your lender needs to know whether you have the capability to repay the money that you’re planning to borrow. So, you will inform them about the comprehensive budget for managing your business successfully, project and operating expenses, external financial sources from investors and partners, savings , and others. For you to win the lender’s trust and loyalty, calculate your estimated income reasonably.
A dressing like a honey lemon vinaigrette is great for green salads. Without a certain type of dressing, your salad becomes a boring and bland food. Turning your food wholesome and sumptuous with a drizzle of a citrusy dressing in your salad is like developing an effective marketing plan for your business plan. It brings out the real essence of your business by the use of advertising. List all the marketing costs and types of advertising you need. To have an effective marketing plan, include any market research that you initiate as you begin your business.
Provide your day-to-day business operations, systems, and additional details such as the processes and methods how your business is conducted. Describe how you implement your plans and explain clearly the various methods you executed. Add the type of quality control you’re doing for your business.
Finally, create a solid conclusion tone as you move and entice the lenders in receiving their full support and earning their complete trust. According to an article by Pen & the Pad, “creating a positive tone that conveys the message with amiable, heartfelt language usually results in a more favorable reader response.” So, you need to create a strong opening for your conclusion, organize your sentence and accentuate positive words in the right way.
First, you will go through the pre-licensing mortgage broker training. Then you must pass the SAFE Mortgage Loan Originator Test. After you pass the exam, register your company and business name. You need to complete the mortgage broker license requirements and get a mortgage broker bond. Establish a network of lenders and buyers, and select a software solution for your brokerage.
Lenders usually pay a higher commission than borrowers do. They typically pay between 0.5% and 2.75% of the total amount of the loan when lenders compensate mortgage brokers.
It is a much better option because brokers commonly have access to far more loan products and types of loans than a large-scale bank, whether it’s FHA loans, VA loans, etc.
You should accomplish 20 hours of pre-licensing training through an approved organization. The training has three hours on federal law and regulations, three hours on ethics, two hours on nontraditional mortgage products, and twelve hours of elective courses. Plus, you need to have analytical and sales skills.
The book “ The Complete Guide to Becoming a Successful Mortgage Broker ” stated that developing relationships with lenders appears to be one of the most essential components of getting started in the mortgage broker business . You need to work with many mortgage lenders. If you build good relationships with underwriters and processors that work for the lenders, your job can be much effortless. Therefore, have a strong confidence while you transform your business into the next level. Get a business plan template today and we hope that you will succeed in your mortgage business journey!
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Creating a business plan is essential for any business, but it can be beneficial for mortgage bank businesses that want to improve their strategy or raise funding.
A well-crafted business plan not only outlines the vision for your company, but also documents a step-by-step roadmap of how you will accomplish it. To create an effective business plan, you must first understand the components essential to its success.
This article provides an overview of the key elements that every mortgage bank business owner should include in their business plan.
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A mortgage bank business plan is a formal written document describing your company’s business strategy and feasibility. It documents the reasons you will be successful, your areas of competitive advantage, and it includes information about your team members. Your business plan is a key document that will convince investors and lenders (if needed) that you are positioned to become a successful venture.
A mortgage bank business plan is required for banks and investors. The document is a clear and concise guide of your business idea and the steps you will take to make it profitable.
Entrepreneurs can also use this as a roadmap when starting their new company or venture, especially if they are inexperienced in starting a business.
The following are the critical components of a successful mortgage bank business plan:
The executive summary of a mortgage bank business plan is a one- to two-page overview of your entire business plan. It should summarize the main points, which will be presented in full in the rest of your business plan.
This section should include a brief history of your company. Include a short description of how your company started and provide a timeline of milestones your company has achieved.
You may not have a long company history if you are just starting your mortgage bank business. Instead, you can include information about your professional experience in this industry and how and why you conceived your new venture. If you have worked for a similar company before or have been involved in an entrepreneurial venture before starting your mortgage bank firm, mention this.
You will also include information about your chosen mortgage bank business model and how, if applicable, it is different from other companies in your industry.
The industry or market analysis is a critical component of a mortgage bank business plan. Conduct thorough market research to determine industry trends and document the size of your market.
Questions to answer include:
You should also include sources for your information, such as published research reports and expert opinions.
This section should include a list of your target audience(s) with demographic and psychographic profiles (e.g., age, gender, income level, profession, job titles, interests). You will need to provide a profile of each customer segment separately, including their needs and wants.
For example, a mortgage bank business’s customers may include individuals who are buying their first home, those who are refinancing their home, or investors looking for a property to flip.
You can include information about how your customers decide to buy from you as well as what keeps them buying from you.
Develop a strategy for targeting those customers who are most likely to buy from you, as well as those that might be influenced to buy your products or mortgage bank services with the right marketing.
The competitive analysis helps you determine how your product or service will differ from competitors, and what your unique selling proposition (USP) might be that will set you apart in this industry.
For each competitor, list their strengths and weaknesses. Next, determine your areas of competitive advantage; that is, in what ways are you different from and ideally better than your competitors.
Below are sample competitive advantages your mortgage bank business may have:
This part of the business plan is where you determine and document your marketing plan. . Your plan should be laid out, including the following 4 Ps.
This part of your mortgage bank business plan should include the following information:
You also need to include your company’s business policies in the operations plan. You will want to establish policies related to everything from customer service to pricing, to the overall brand image you are trying to present.
Finally, and most importantly, your Operations Plan will outline the milestones your company hopes to achieve within the next five years. Create a chart that shows the key milestone(s) you hope to achieve each quarter for the next four quarters and the following four years. Examples of milestones for a mortgage bank business include reaching $X in sales. Other examples include expanding to a new location, hiring additional staff, or launching a new product or service.
List your team members here, including their names and titles, as well as their expertise and experience relevant to your specific mortgage bank industry. Include brief biography sketches for each team member.
Particularly if you are seeking funding, the goal of this section is to convince investors and lenders that your team has the expertise and experience to execute on your plan. If you are missing key team members, document the roles and responsibilities you plan to hire for in the future.
Here you will include a summary of your complete and detailed financial plan (your full financial projections go in the Appendix).
This includes the following three financial statements:
Your income statement should include:
Revenues | $ 336,090 | $ 450,940 | $ 605,000 | $ 811,730 | $ 1,089,100 |
$ 336,090 | $ 450,940 | $ 605,000 | $ 811,730 | $ 1,089,100 | |
Direct Cost | |||||
Direct Costs | $ 67,210 | $ 90,190 | $ 121,000 | $ 162,340 | $ 217,820 |
$ 67,210 | $ 90,190 | $ 121,000 | $ 162,340 | $ 217,820 | |
$ 268,880 | $ 360,750 | $ 484,000 | $ 649,390 | $ 871,280 | |
Salaries | $ 96,000 | $ 99,840 | $ 105,371 | $ 110,639 | $ 116,171 |
Marketing Expenses | $ 61,200 | $ 64,400 | $ 67,600 | $ 71,000 | $ 74,600 |
Rent/Utility Expenses | $ 36,400 | $ 37,500 | $ 38,700 | $ 39,800 | $ 41,000 |
Other Expenses | $ 9,200 | $ 9,200 | $ 9,200 | $ 9,400 | $ 9,500 |
$ 202,800 | $ 210,940 | $ 220,871 | $ 230,839 | $ 241,271 | |
EBITDA | $ 66,080 | $ 149,810 | $ 263,129 | $ 418,551 | $ 630,009 |
Depreciation | $ 5,200 | $ 5,200 | $ 5,200 | $ 5,200 | $ 4,200 |
EBIT | $ 60,880 | $ 144,610 | $ 257,929 | $ 413,351 | $ 625,809 |
Interest Expense | $ 7,600 | $ 7,600 | $ 7,600 | $ 7,600 | $ 7,600 |
$ 53,280 | $ 137,010 | $ 250,329 | $ 405,751 | $ 618,209 | |
Taxable Income | $ 53,280 | $ 137,010 | $ 250,329 | $ 405,751 | $ 618,209 |
Income Tax Expense | $ 18,700 | $ 47,900 | $ 87,600 | $ 142,000 | $ 216,400 |
$ 34,580 | $ 89,110 | $ 162,729 | $ 263,751 | $ 401,809 | |
10% | 20% | 27% | 32% | 37% |
Include a balance sheet that shows your assets, liabilities, and equity. Your balance sheet should include:
Cash | $ 105,342 | $ 188,252 | $ 340,881 | $ 597,431 | $ 869,278 |
Other Current Assets | $ 41,600 | $ 55,800 | $ 74,800 | $ 90,200 | $ 121,000 |
Total Current Assets | $ 146,942 | $ 244,052 | $ 415,681 | $ 687,631 | $ 990,278 |
Fixed Assets | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 |
Accum Depreciation | $ 5,200 | $ 10,400 | $ 15,600 | $ 20,800 | $ 25,000 |
Net fixed assets | $ 19,800 | $ 14,600 | $ 9,400 | $ 4,200 | $ 0 |
$ 166,742 | $ 258,652 | $ 425,081 | $ 691,831 | $ 990,278 | |
Current Liabilities | $ 23,300 | $ 26,100 | $ 29,800 | $ 32,800 | $ 38,300 |
Debt outstanding | $ 108,862 | $ 108,862 | $ 108,862 | $ 108,862 | $ 0 |
$ 132,162 | $ 134,962 | $ 138,662 | $ 141,662 | $ 38,300 | |
Share Capital | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 |
Retained earnings | $ 34,580 | $ 123,690 | $ 286,419 | $ 550,170 | $ 951,978 |
$ 34,580 | $ 123,690 | $ 286,419 | $ 550,170 | $ 951,978 | |
$ 166,742 | $ 258,652 | $ 425,081 | $ 691,831 | $ 990,278 |
Include a cash flow statement showing how much cash comes in, how much cash goes out and a net cash flow for each year. The cash flow statement should include cash flow from:
Below is a sample of a projected cash flow statement for a startup mortgage bank business.
Net Income (Loss) | $ 34,580 | $ 89,110 | $ 162,729 | $ 263,751 | $ 401,809 |
Change in Working Capital | $ (18,300) | $ (11,400) | $ (15,300) | $ (12,400) | $ (25,300) |
Plus Depreciation | $ 5,200 | $ 5,200 | $ 5,200 | $ 5,200 | $ 4,200 |
Net Cash Flow from Operations | $ 21,480 | $ 82,910 | $ 152,629 | $ 256,551 | $ 380,709 |
Fixed Assets | $ (25,000) | $ 0 | $ 0 | $ 0 | $ 0 |
Net Cash Flow from Investments | $ (25,000) | $ 0 | $ 0 | $ 0 | $ 0 |
Cash from Equity | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 |
Cash from Debt financing | $ 108,862 | $ 0 | $ 0 | $ 0 | $ (108,862) |
Net Cash Flow from Financing | $ 108,862 | $ 0 | $ 0 | $ 0 | $ (108,862) |
Net Cash Flow | $ 105,342 | $ 82,910 | $ 152,629 | $ 256,551 | $ 271,847 |
Cash at Beginning of Period | $ 0 | $ 105,342 | $ 188,252 | $ 340,881 | $ 597,431 |
Cash at End of Period | $ 105,342 | $ 188,252 | $ 340,881 | $ 597,431 | $ 869,278 |
You will also want to include an appendix section which will include:
Writing a good business plan gives you the advantage of being fully prepared to launch and grow your mortgage bank company. It not only outlines your business vision but also provides a step-by-step process of how you are going to accomplish it.
Now that you know how to write a business plan for your mortgage bank, you can put together your own.
Wish there was a faster, easier way to finish your business plan?
With our Ultimate Business Plan Template you can finish your plan in just 8 hours or less!
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Updated: Aug 18, 2022, 12:46pm
A business plan is a document that lays out a company’s strategy and, in some cases, how a business owner plans to use loan funds, investments and capital. It demonstrates that a business is already producing income and has a plan to continue doing so moving forward.
A successful business plan is well-written, realistic, concise and, most importantly, convinces financial institutions that approving your business for a loan is a smart choice.
Here’s what you need to know about each section of a business plan and how to write a plan that will earn a lender’s stamp of approval.
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A successful business plan outlines your entire business and effectively explains how it makes money and why it’s likely to succeed. This is especially important if you’re trying to get a small business loan .
The content of a business plan should vary from company to company, but there are a few common sections that will help lenders better understand your business and help you qualify for financing.
An executive summary concisely summarizes your business plan—usually on one page. The goals of this section are to inform the reader about the business as a whole, summarize what is contained in the rest of the document and capture their interest. That said, the best use of this section may depend on the age of your business.
The industry analysis section of a business plan defines the business’ industry and mentions current trends—with a focus on risks and opportunities. The section also informs the reader about how the industry works and where the business fits in the industry as a whole.
This section should start by defining the industry, as well as what products and services it provides, and what consumer demand it fulfills. Next, identify the most important influences in the industry. In the case of a bank, this may include applicable government regulations; for a clothing boutique, it may be consumer trends and budget.
The industry analysis should also define the company’s intended niche in the industry.
The market analysis zooms into the specific market niche mentioned in the previous section. Market analysis aims to detail the segment of the broader market the business is intended to fit within. For example, a fashion brand or boutique may target high-income consumers.
Use this section to explain how the segment differs from the wider industry. In the fashion boutique example, a market analysis may reveal that high-income consumers in the fashion industry pay substantially more for brands that are considered exclusive.
Also, describe the size of your business’ niche and how it fits into the wider industry. This should include mention of how many existing businesses operate in this niche and how they target consumers.
A competitor analysis explains what competitors in your niche do and informs the reader of the current market environment. Start with an overall assessment of your competitors. Then, discuss the most relevant competitors for your niche. When conducting a competitor analysis, ask yourself the following questions:
Using the example above, many clothing boutiques compete by providing higher quality products or a unique, luxury shopping experience. If your store has a single location, your competitor might be another clothing store with a similar price-point or signature style.
In the target market segmentation, you’ll identify your business’ target market and describe how you will meet its needs. This section aims to instill confidence in the lender by providing a clear and objective strategy for building revenue.
Begin the section by informing how your products or services meet your shoppers’ needs. Next, explain how consumers can access your products or services—including a brief outline of your marketing strategy and how it is tailored to your target clients. Contrast this to your competitors’ strategy as defined in the previous section. After reading this portion of the business plan, the lender should know exactly how your business intends to compete.
Use this section of the plan to explain what your business offers its ideal customers and to contrast your product and service offering to that of your competitors. Start by defining your product and service offering, including pricing. Also, inform the reader what equipment or materials you need to provide your products and services. For instance, a fashion apparel brand needs access to textile manufacturers.
Now that the lender understands what you offer, explain how you plan to market it in greater detail. This section outlines how you’ll attract and convince consumers to buy from you. The goal is to provide a flexible and realistic marketing and sales plan that convinces the reader you know how to attract consumers.
The sales strategy section of your business plan also should include the company’s revenue goals and explain how your marketing and sales department will achieve them. Provide in-depth details on the marketing and sales challenges you’ll face and how to overcome them. While this information is always relevant, it’s particularly important to lenders reviewing your loan application as they will want to know how you plan to make money.
The operations plan details your company’s day-to-day operations. This detail-oriented section should comprehensively explain how your business will operate, beginning with a list of your company’s daily activities.
As a high-end clothing boutique, your daily operations may include:
Note: This section is more about your business’s daily processes rather than its organizational structure—which is the next section.
Use the management section of your business plan to tell the lender who does what in the company and how they’re compensated. Help the lender better understand the people behind the company by including biographical and background information on the company’s owners and key executives.
The best way to present this information is often with an organizational flowchart. You can also include other information about the company in this section, like your mission statement and values.
Your financial plan tells a prospective lender two things: how much you plan to spend each year and how much you’ll earn in revenue. This section is the most important for most businesses, as it can make or break a lender’s confidence and willingness to extend credit.
Always include the following documents in the financial section of your business plan:
Most lenders ask established businesses for at least three years of financial data, and some may ask for five. Preferably, include as much financial data as possible. If you’re a startup, include estimated costs and projected revenue, and supplement your data with industry averages or financial data from competitors.
Your business plan should always include an exit strategy in case things go wrong or you simply decide to close up shop. This may include everything from taking on new partners to selling your business or even declaring bankruptcy. Having an exit strategy is another way to show lenders that you have thought about the risks involved with your business and are prepared for them.
The appendix of a business plan normally contains financial information and other documents the reader may need to gain a comprehensive understanding of the business. Established businesses typically include financial statements and projections, at a minimum. In contrast, a startup could include the research they conducted to make the business plan.
Also consider including relevant resumes, marketing materials, letters of recommendation or references. For ease, your appendix should have a table of contents directing lenders to the most important documents.
There are five things that lenders typically look at when making business lending decisions: character, capacity, capital, conditions and collateral. By understanding these key considerations, you can draft a business plan that speaks to a lender’s interests and concerns.
A business’ character includes subjective, intangible qualities like whether its owners are perceived as honest, competent or determined. Stated another way, lenders want to know that you are honest and have integrity. These qualities can be critical for evaluating candidates because most lenders don’t want to lend to someone they don’t feel they can trust.
To evaluate the character of you and your business, lenders look at your personal credit history as well as your business’ financial history. Use your business plan to bolster your character by including ample financial records, letters of recommendation and other relevant documents.
Lenders want to know that you have the ability to repay the loan. They evaluate this by looking at your business’ financial history to see how much revenue you have generated in the past and how much profit you have made.
Lenders might also judge your capacity based on your business’ financial projections as well as your personal credit history and household income. Where relevant, lenders look at your management team to see if they have the experience needed to grow your business or keep it on a path toward success.
When reviewing your loan application, lenders read your business plan to see how much money you need to borrow and how you will repay the loan. They also look at your financial statements to see how much cash you have on hand and how much debt you are carrying.
Likewise, lenders often prefer business owners who have made larger personal financial investments in their enterprises. A personal financial investment reveals your commitment to the business and demonstrates you have the resources to pay off a large loan.
Ultimately, a lender’s biggest concern is whether your business can realistically succeed. So, they judge your company’s chances of success using your business plan as well as current market conditions. A good business plan can improve your lender’s confidence by convincing the lender that market conditions and your business strategy increase your odds of success.
In some cases, lenders want to know that you have something of value that they can use to secure the loan. This can be property, equipment, inventory or even receivables. If you don’t have any collateral, lenders may still approve a loan if you have a good credit history and a solid business plan.
Kiah Treece is a small business owner and personal finance expert with experience in loans, business and personal finance, insurance and real estate. Her focus is on demystifying debt to help individuals and business owners take control of their finances. She has also been featured by Investopedia, Los Angeles Times, Money.com and other financial publications.
By: Author Tony Martins Ajaero
Home » Business ideas » Financial Service Industry » Lending & Loan Brokerage Business
Are you about starting a micro lending business? If YES, here is a complete sample micro lending business plan template & feasibility report you can use for FREE .
Okay, so we have considered all the requirements for starting a micro lending business . We also took it further by analyzing and drafting a sample micro lending company marketing plan template backed up by actionable guerrilla marketing ideas for micro lending businesses.
Building a micro lending and mortgage business is not different from building a normal brokerage or loan business. Micro lenders may actually broker loans to small businesses without collateral, but they are different from brokers because they have the license and right to lend money to people seeking home financing.
Building your own Micro lending and mortgage business might seem or sound easier and the joy of creating your own hours and keeping your commissions may be very attractive. You may also avoid office drama and politics and plan your own advancement opportunities.
But bear in mind that handling some logistics properly will be very crucial to getting your micro loan business running successfully. This is why it is very important that you learn all the ropes of the business before you look at starting yours. There are many grey areas of the micro lending business that needs to be mastered.
One of the ways to get really conversant with the micro lending business is to carry out your own feasibility research. Also you may want to use a business plan template to learn all that the business involves. The cost of starting, how many employees you will need amongst many others. Here is a sample micro lending business plan;
1. industry overview.
Even in hard economic conditions, people and enterprises go for loans to be able to pay for the purchase of real estate and other transactions, which in turn make the lending business a recession-proof business. But before going into the micro lending and mortgage business, you need to know the contours and crannies of this large industry.
The Micro lending and mortgage business is actually coming back from a drastic crash in the housing market, economic recession and also riding with the swelling competition from commercial banks within the five years to 2016. The Micro lending and mortgage industry revenue doubled prior to the recession because of the unequivocal consumer demand for credit and the popular use of a wide variety of micro options for previously unqualified borrowers.
Due to the steady and good improvements in the housing sector in the past few years, the micro lending and mortgage industry has moved its focus toward earning back its reputation. In the approaching years to 2022, the micro lending and mortgage industry it is believed to continue recovery due to raising economy, and the housing market will favourably help the industry’s growth.
The Micro lending and mortgage industry may also venture into a declining stage of its economic life cycle because of the competition they face from commercial banks which is becoming imminent. The industry value added (IVA), which actually decides the industry’s contribution to the overall economy, is expected to grow at an annual rate of 1.5% within the 5 years to 2022.
Earnestly, the US GDP is believed will grow at a yearly rate of 2.2% during the same period. All these figures explain that the industry’s share of the US economy is quietly declining. A
lso during the past 10 years, the immediate introduction of brand new products, including subprime mortgages, Alt-A mortgages and NINJA loans, and reduced lending standards supported demand for home loans, has explicitly injected a positive pressure on the need for micro lenders and brokers that have actually enjoy unlimited access to these products and to a enjoy variety of interest rates.
Vanguard lenders LLC is an outstanding micro lending and mortgage firm that will be attending to the enormous needs of small businesses, real estate professionals, builders and individual home buyers. We have access to a full range of microfinance and we offer the right loan–with the best rates, terms and costs–to meet our prospective customer’s enormous needs.
Vanguard lenders LLC offers high-quality micro lending and mortgage services to residential and business customers. Our major aim is to provide our customers with substantial microloans at reasonable prices and rates, while also keeping our customers Informed and active throughout the process.
Vanguard lenders LLC will also strive to become friends and advisers to our customers as well as quality service providers. Vanguard lenders LLC is a good firm to work, a professional work environment that is challenging, rewarding, innovative, and respectful of our customers and employees ideas and plans.
Vanguard lenders LLC will unanimously provide excellent value to our customers and fair reward to its owners and employees. Vanguard lenders LLC is also a legally registered micro lending and mortgage firm which will be located in the City of Alexandria, Virginia.
We will be occupying a standard office facility in the business district of the city, giving us the suitable traffic to attract customers. We plan to mould Vanguard lenders LLC into the very best of Micro lending and mortgage firm and actually compete favourably in the industry.
Our business goal which is to take over the market completely may seem outrageous, but we are very positive that it will be realized because we have done an extensive research and feasibility studies and we believe we have dotted all our i’s and made all reasonable judgements to position Vanguard lenders LLC for the war to take over Virginia entirely.
Vanguard lenders LLC are capitalized by two principal investors, Mr John Taylor and Mr Alfred Garth. Both are well renowned in the lending industry with a combined experience of over 30 years in the industry.
We’re going to be offering a varieties of services within the parameters of the micro lending and mortgage services industry in the united states of America and of course on the global stage. We are well place to maximise profits in the industry and we plan to do all within the proximity of the law in the United States to achieve these goals, aim and ambition. Our business offering are listed below;
Our Business Structure
Vanguard lenders LLC is a micro loan service firm that we hope to grow big in order to compete favourably with leading microloan service firms in the industry both in the United States and on a global stage. We understand the need to create a solid business structure and hire capable hands that will aid in making Vanguard lenders LLC the best among the best.
The sort of loan services we hope to build and the great goals we want to achieve is what moved us to choose the list of offices and individuals we need to hire. We believe that these portfolios will be filled with well experienced and learned individuals, who understand the do and don’ts of the lending market.
We also hope to hire people that are qualified, hardworking, and creative, result driven, customer centric and are ready to work to help us build a prosperous business that will benefit all the stake holders (the owners, workforce, and customers).
Chief Executive Officer
Human Resource and Admin Manager
Receptionist
Business Consultant
Sales and Marketing Director
Company Accountant
Security guard
We at Vanguard lenders LLC are prepared to build a super– structured microloan services firm that can take over the entire microloan service industry. Which is why we inculcated the help of well known consultancy firm, a firm known for its strict and precise way of doing business and also renowned for offering the best when contacted.
We contacted Brick Lewis Financial consults to help us with a SWOT Analysis in our designated business location and long term goals. Brick Lewis financial consults being the best in what they do, involved the management of Vanguard lenders LLC in conducting a SWOT analysis.
Here is a summary from the result of the SWOT analysis that was conducted for Vanguard lenders LLC by Brick Lewis financial consults;
It was literally noted that the strength of Vanguard lenders LLC doesn’t really rest on our fierce business network with other financial lending institutions, professional brokers in the industry or players in the real estate industry, but on the capacity, vision and experience of our team.
Vanguard lenders LLC has a team that are prepared to offer our clients the very best; a team that is well placed, professional and ready to pay attention to details and to maximise financial profits for the business. Vanguard lenders LLC are also positioned in a city with more family values and acknowledgement for each other, which will serve as a force to move our business to its destination.
Brick Lewis Financial consults believe our weakness would be how easy we break into the market and gain acceptance since we are just a new firm, especially from corporate clients in the already saturated micro lending and mortgage industry; that is perhaps our major weakness. But we’re positive that our publicity and advertisements would aid us in this aspect.
Opportunities
The opportunities in the lending industry is very big and daring, going by the size of people, business start ups and without doubt corporate organizations who are all in need of microloans to aid them reach their individual goals and vision.
Vanguard lenders LLC being a standard and well – positioned microloan services firm, we are well – prepared and ready to clamp any opportunity that comes our business path within the proximity of the law in the United States.
Brick Lewis Financial consults believes that most of the threats that we at Vanguard lenders LLC are likely to face as a microloan service firm operating in the United States will be unfavourable government policies, the introduction of a competitor within our location of operations and global economic downturn which usually affects purchasing / spending power.
It was also envisaged that we should beware of huge losses in three situations: due to sharp, sustained increases in interest rates, accounting control fraud, or the collapse of hyper-inflated residential real estate bubbles. So, to mitigate these threats, we have induced the use of credit scoring software like and we hope and are well prepared to use else any of these threats to our own advantage.
We all know and understand how massive and enormous the microloan services industry is and of course it is one industry that works for individuals and businesses across different industries. A lot of people depend on the services provided by the industry to empower themselves and businesses, showing how important and helpful this industry has been and will still remain.
The micro lending and mortgage industry flows with a low level of capital intensity. It is believed that for every $1.00 spent on wages, the micro lending and mortgage industry will allocate $0.08 in capital investment. This 2016 figure indeed shows a slight increase from $0.05 in 2011.
The micro lending and mortgage industry gives loans to businesses, agencies and individuals by raising funds in the secondary market. These businesses will continue to perform these functions without depending on significant capital expenditure.
Most of the capital expenditure for the lending business is related to computers and technology used to process loans and store information. We expect the increase in the investment in technology infrastructure in the micro lending and mortgage industry, particularly delivering online services.
It is sincerely true that without the services of the loan services industry, most individuals and even start – up businesses will find it hard to access loan or save – up to purchase a property. The lending industry is explicitly responsible for helping individuals and businesses bypass the bureaucracies involved in obtaining loans from banks and other financial institutions et al
Within the past few years, the lending industry has aided in reducing unemployment in the United States and has also boosted the revenue generated in the United States. So also, the microloan service industry has benefited from the advancement of online platforms.
Moving higher, increasing product penetration and of course an expanding customer base is expected to drive growth in the industry.
The lending industry is an industry that has without doubt aided a lot of individuals, companies and start ups. At Vanguard Mortgages, we will first and foremost serve small to medium sized business, from new ventures to other bigger businesses and individual clients, we hope to take the market one step at a time and without much notice take over the market quickly.
Vanguard lenders LLC being a standard micro lending and mortgage business will capitalize on the large variety of microloan service and other industry related services we wish to offer, hence made sure all are employees are well trained and equipped to serve a diverse range of clientele base.
Vanguard lenders LLC target market will slice across businesses of different sizes and individuals. We believe our business is equipped with a breath taking business concept that will help us work with individuals, small businesses and bigger corporations in Alexandria, Virginia and all other cities in the United States.
Outlined below is the list of businesses and organizations that we have categorically designed our products and services for;
Our Competitive Advantage
We at Vanguard lenders LLC understands explicitly the level of competitive in the microloan service industry, and due to our extensive research and planning, we should be able to penetrate the market and offer our prospective clients with easy to access microloans; thereby deleting the hard and long process needed to obtain loans from the bank and other financial institutions.
Vanguard lenders LLC might be a new micro lending and mortgage business in the United States of America lending industry, but it cannot be denied that the workforce and owners of Vanguard lenders LLC are considered micro lending and mortgage industry gods.
Right from the primary foundation of the business, who are the owners, up to the very height of our employees are core professionals, well trained and highly qualified microloan consultants in the United States. This is a fact that will push us ahead of competitors in the lending industry.
We also help to create a comfortable business environment for our employees and also inculcate them into the business by offering work bonus and loyalty bonus which will be calculated with more or less 10 years duration, which will push them to give their all and stay loyal to the business, and also help us to build a classic business that will be the topmost micro lending and mortgage business in the whole of United States.
A vanguard lender LLC was founded to become the lead player in the micro lending and mortgage loan field. We also hope to bring in good and substantial profit, while also giving our customers and satisfaction they deserve to achieve their goals and targets.
We plan to generate income by offering the following microloan services for individuals, real estate companies, NGOs and for corporate organization. We plan to maximise profits and get substantial incomes by offering the following services;
We at Vanguard lenders LLC actually understand how hard and the rigorous process people go through to obtain loans from banks and other financial institutions, we hope to make this process less tough and create a substantial base of happy and satisfied clients.
This goes to show that the potential to generate income for the business cannot be ruled out. Vanguard lenders LLC was established to lead the war against poverty and we hope to make it the best of the best, and on our online platforms and we are very positive that we will meet our set target of getting substantial income / profits from the first six month of work and grow the business and our clientele base within and outside Virginia
After our extensive market research and with the help of the various consultancy firms we employed, we came out with our sales forecast for the next three years. The sales forecast was calculated and planned based on information gathered on the field and some assumptions that are common with new entrants in the Industry.
Outlined below is a detailed sales forecast for Vanguard Mortgages, which we believe and hope we will surpass with hard work and perseverance. This sales forecast is also based on the location of our business and the innovative business we will be offering to our clients.
Note : The above forecast was done based on what can be gotten in the industry and with the expectation that there won’t be any major economic meltdown and natural disasters within the next three years in the whole of Virginia.
We also hope there won’t be any fierce competitor offering all the services we hope to offer to our customers in Alexandria Virginia. It will also be worthwhile to note that the above forecast might be lower and at the same time it might be higher.
We all at Vanguard lenders LLC are very much aware of the threats and strict competition in the micro lending and mortgage business, and we have devised our strategic means to win and suppose them. This may include hiring the best hands for the job and also creating a more attack minded marketing plan.
Our sales and marketing director will be employed based on his/her undeniable experience and innovative competition winning mind-set in the industry and we hope to train him or her extensively with other sales and marketing workers to be prepared and well equipped to meet their targets and the overall goal of Vanguard Mortgages.
We also hope to make sure that our genuine and businesslike approach speaks volume for us in the industry; we also plan to build a business that will use or employ the use of customer satisfaction to boost our client base.
The major goal of Vanguard lenders LLC is to grow a business that will be considered the very best in Virginia and one of the top 5 micro lenders in the United States of America which is why we have after much consideration and research outlined strategies that will help us lead of the Alexandria market and grow to become a major force to consult with in Virginia in the next two years.
We hope to make use of the listed strategies to build our business and become the war Vanguard for the battle against economic recession;
Vanguard lenders LLC have also contacted the service a renowned firm that is known for its legit ways of boosting a company’s brand awareness, to help us create publicity and advertising strategies that will aid us to attract and keep our target market, and also make our presence known and felt by all and sundry.
We also want to take Alexandria Virginia by storm with our undefiled publicity and advertising strategies. Listed below is the summary of capable strategies suggested by Artwork business consult for Vanguard Mortgages;
We all at Vanguard lenders LLC understand that the industry is moved by the increase in demand and availability of real estate / properties which is why there can never be a price model that will be suitable for the lending industry. As we all know, the prices for properties fluctuates on a regular basis.
We are also aware that most lending firms rely on commissions since they serve as middlemen between those seeking for microloans and the secondary financiers but we hope to create a more direct approach by offering those loans ourselves which can be very possible due to the large incentives our founders are willing to inject.
We hope to keep the prices of our services and commissions at Vanguard lenders LLC below the average market rate for our clients for the maintime.
We also hope to provide them with loans coupled with low interest rates that will bring them closer to the firm, and we hope to move our prices a little higher when we have achieved a substantial corporate identity in the micro lending and mortgage industry.
We plan to provide various a wide varieties of payment options to suit our clients at Vanguard Mortgages. We understand the need and the diverse countenances of people, and the way they understand and process things differently, and we tend to provide a suitable platform that will suit all and sundry equally. Listed below are the payment options that we will make available to Vanguard Lenders LLC.
With reference to the above platforms, we have chosen a well renowned bank in the United States to aid in our business.
We have chosen and opened a corporate current account with Capital one financial Corporation. Our bank account numbers will be made available in website and promotional materials to clients who may want to make cash deposit and it will also be given explicitly to clients on request.
We at Vanguard lenders LLC understand that starting a Micro lending and mortgage Business is not an easy task especially due to its capital constraints; this is because you are not expected to acquire expensive machines and equipment, be capable to provide loans and solve other issues and legal proceedings.
Also one need to be concerned about is the enormous amount needed to acquire or lease a standard office facility in a good and busy business district, the price needed to acquire furniture and equip the office, the money needed to purchase the required software applications, the needed to pay bills like phone bills and water bills, obtain license, advertise the business. Outlined below is a detailed financial projection and costing for starting Vanguard Lenders LLC;
With the above detailed cost analysis of starting a Micro lending and mortgage Business, it is understood that we need $1,322,350 to successfully set up Vanguard lenders LLC which is a large scale micro lending and mortgage business.
Vanguard lenders LLC is a well licensed and registered Micro lending and mortgage business which is capitalized by two principal investors, Mr John Taylor and Mr Alfred Garth. They are the founders and financiers of the business and hope to remain so for now, with hope to accept partners at a very ripe and mature stage in the business.
Due to less constraint in financing Vanguard Mortgages, we have outlined the few ways we can acknowledge funding and start up capital. These was may include;
Note : Vanguard lenders LLC has been able to generate an enormous $1.4 million from its two principal investors, who aligned and individually prune out $700,000 each. We believe that the amount is substantially enough to run the business for the first three months, which by then we expect to sustain the business by the cash and incentives generated from our business proceedings.
Every business wants to expand and stand the test of time, and this achievement lies in the number of loyal customers in their clientele base and the competence of the employees, investment procedures and the business structure they choose. A business without these mentioned criteria is not business but a playground that will end even before it starts.
Vanguard lenders LLC was established to spread its wings across the sky of Virginia, and also expand and fly all through the nick and crannies of the United States, clamping and taking over the market in each turn. We believe with our unique business structure and competent hands, we will be able to start surviving with the cash we make right from the second month of operations.
We also understand that one of the strategies of gaining approval and winning customers over is to offer innovative services to our customers at a cheaper than what is obtainable in the industry and we have made plans to survive and compete favourably within those periods.
We all at Vanguard lenders LLC will ensure that we employ the right foundation, structures and processes, and also make sure that our employees starting from our guards up to our investors are well catered for. We hope to create a family in the firm, that value work ethics, same zeal and goal to move Vanguard lenders LLC to its expected height.
We also plan to employ profit-sharing arrangement which will enable our management staff enjoy the fruit of their labour.
This arrangement will be decided upon during a considerable duration of 5 years and upon decision of the board of the organization. With these and many more attractive employees focused incentives, we hope to hire and retain employees that are the best in any field they are hired for.
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A free example of business plan for a mortgage brokerage firm. Here, we will provide a concise and illustrative example of a business plan for a specific project. This example aims to provide an overview of the essential components of a business plan. It is important to note that this version is only a summary.
Develop A Mortgage Broker Business Plan - The first step in starting a business is to create a detailed mortgage broker business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.
Mortgage Broker Business Plan Template. Over the past 20+ years, we have helped thousands of mortgage brokers start and grow their businesses. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a mortgage brokerage company business plan step-by-step so ...
Follow these tips to quickly develop a working business plan from this sample. 1. Don't worry about finding an exact match. We have over 550 sample business plan templates. So, make sure the plan is a close match, but don't get hung up on the details. Your business is unique and will differ from any example or template you come across.
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Writing a mortgage broker business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan: 1. Executive Summary. An executive summary is the first section planned to offer an overview of the entire business plan. However, it is written after the entire business plan is ready ...
Executive Summary. Claremont Funding is an outstanding mortgage brokerage firm serving the lending needs of real estate professionals, builders and individual home buyers. We have access to a full range of mortgage sources and are dedicated to finding the right loan-with the best rates, terms and costs-to meet our clients' unique needs.
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How to Write a Mortgage Brokerage Business Plan in 7 Steps: 1. Describe the Purpose of Your Mortgage Brokerage Business. The first step to writing your business plan is to describe the purpose of your mortgage brokerage business. This includes describing why you are starting this type of business, and what problems it will solve for customers.
Specify how much funding you'll need, any terms you'd like applied, and the timespan your request will cover. You'll also want to add a detailed account of how you plan to use the funds. Whether you plan to request funding or not, you will need to include financial projections. While your broker business isn't yet established, analyze ...
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Before your launch dates, choose your color palettes and create your logo. Then, using the selected color patterns as a guide, create alternate outputs. When creating flyers or leaflets, make sure that the advertising materials have a specific direction. 3. Select Your Marketing or Advertising Campaigns.
Download this Mortgage Broker Business Plan Template Design in Word, Google Docs, PDF, Apple Pages Format. Easily Editable, Printable, Downloadable. A professional business plan specifically tailored for a mortgage brokerage firm. It encompasses market analysis, lead generation strategies, and financial projections.
11+ Mortgage Broker Business Plan Templates in DOC | PDF. Finding innovative ways to improve the business is a constant ordeal. You have corporate think tanks doing their substantial analysis about the market to help the executives create big decisions. Report documents are always on the desks that will urge the need for changes. With all the facts and figures, planning steps in to ascertain ...
2. Average commission per loan for the last 12 months 3. Number of funded loans required (#1 divided by #2) 4. Average loan amount for past 12 months 5. What is my dollar closing goal? (#3 x #4) 6. Funding to application % (should be a minimum of 80% - target of 95%) 7. Calculate the number of applications I'll need to meet my funding goal
Basic Mortgage Broker Business Plan. 9. Mortgage Broker Business Plan. 10. Mortgage Broker Business Plan Format. 11. Standard Mortgage Broking Business Plan. 12. Mortgage Broker Business Plan Questionnaire.
1830 College Parkway, Suite 100 Carson City, NV 89706 (775) 684-7060 Fax (775) 684-7061 www.mld.nv.gov. MORTGAGE BROKER BUSINESS PLANAll applicants are required to provide a general business plan indicating how they plan to conduct business and a description of the policies and procedures that the mortgage broker and its mortgage agents will ...
Writing an Effective Mortgage Bank Business Plan. The following are the critical components of a successful mortgage bank business plan:. Executive Summary. The executive summary of a mortgage bank business plan is a one- to two-page overview of your entire business plan. It should summarize the main points, which will be presented in full in the rest of your business plan.
This section is the most important for most businesses, as it can make or break a lender's confidence and willingness to extend credit. Always include the following documents in the financial ...
Mortgage Company Business Plan MLD Form 211 Rev. 12/26/2019 Page 2 of 2 Wholesale Lender Activity 4. Will the Applicant do either of the following in relation to a loan which will be secured by real property located in Nevada: ... sample "hello" and "goodbye" letters; and the person who will be responsible for the Nevada portfolio of ...
A Sample Micro lending Business Plan Template. 1. Industry Overview. Even in hard economic conditions, people and enterprises go for loans to be able to pay for the purchase of real estate and other transactions, which in turn make the lending business a recession-proof business. But before going into the micro lending and mortgage business ...
The following market size facts and statistics bode well for John's Bakery. According to the 2017 report entitled, "Retail Bakeries Industry in the U.S." by Supplier Relations US, LLC, the retail bakery industry's revenue for the year 2008 was approximately $3.6 billion, with an estimated gross profit of 25.52%.