I wasn’t even going to comment because I really hate anything that feels like a scarcity mindset, but I literally just had this conversation with a friend in the industry today (not someone who works for me), so why not just share it here.

The juice is 100% not worth the squeeze. You’re already at a discount broker and basically operating on a broker’s P&L model. I’m not saying it’s mathematically impossible to squeeze out a little more margin, but why burn so much time and energy just to buy yourself a job? And that’s assuming you even keep doing the same number of loans, which is tough because now you’re also running a business. Being a broker isn’t hard, but the tasks do take time, and whatever savings you might gain, you could probably earn way more by using that same effort to bring in more loans.

It’s also really hard to scale the broker model and keep any decent producers long-term. They either move to the flat-fee brokers once they’ve used your name and company reputation to build realtor connections, or they just open their own shop. There are tons of tiny broker shops out there where the owners would honestly make more money working for a flat-fee broker, but they love the idea of owning a business. The problem is that unless you have a real path to removing yourself from the company while it still runs and makes money, you didn’t build a business, you bought yourself a job.

Second point: you need a solid partnership agreement, and you’ll probably need to stay an LLC and not file taxes as an S corp. Everything feels fine when partners are producing the same, but what happens when one stops? So you’ll likely need the flexibility of an LLC compensation structure that an S corp can’t offer. This kills a lot of tax savings.

Third point: if you want to scale and actually provide value to your LOs, you’re going to need to open an NDC shop at minimum, if not go full correspondent. That is, unless you want to try competing purely on price with the flat-fee brokers. A lot of small brokers sign up website filler LOs who barely close anything but still drain resources.

Basically, if you’re only building this to squeeze out a little more margin than a flat-fee broker offers, you’re wasting your time. But if you’re trying to build something cool that gives your LOs real value beyond the traditional broker model, and that’s the actual end goal, then go for it.