Should You Start Your Own Mortgage Brokerage? The Real Truth from Someone Who’s Been There

Lately, my phone, email, and LinkedIn messages have all been blowing up with the same question:

“Megan, should I start my own mortgage company?”

It’s coming from all kinds of people—top-producing loan officers, real estate agents looking to expand into lending, financial advisors who want to control the whole transaction.

Some want bigger paychecks. Others want freedom—the freedom to make decisions without corporate red tape, the freedom to set their own schedule, the freedom to create a culture they actually enjoy working in.

And then there are the legacy builders. The ones who want to create a brand that outlives them, that they can pass to their kids, or sell for a major payday.

If you’ve been Googling “how to open a mortgage company”, researching mortgage franchise opportunities, or running the numbers on mortgage broker startup costs, you’re probably wondering… is this worth it?

I’m Megan Marsh, co-founder and CEO of Co/LAB Lending Franchise and Co/LAB Broker Concierge. I went from closing over 300 loans a year—burned out, tied to my desk—to owning a multi-state brokerage and helping other entrepreneurs do the same.

Here’s the real talk I wish someone had given me before I started.

Why Do You REALLY Want to Own a Mortgage Company?

I’m going to tell you something you might not want to hear: your reason for starting matters more than your skill at closing loans.

1. If it’s about making more money

Owning your own brokerage can mean bigger profits—but only if the math works.

• Are you already producing $1M–$1.5M+ in monthly volume?

• Do you know your exact cost per closed loan?

• Can you handle going months without a paycheck while you ramp?

When I first started, I thought “I’ll just close the same volume and keep more of the pie.” What I didn’t factor in was overhead—staff salaries, technology, compliance, and marketing chewed up way more than I expected.

2. If it’s about freedom

Freedom in business can mean two very different things:

• Decision-making freedom – choosing your own vendors, tech stack, marketing strategy, and staff.

• Time freedom – working less and having more personal time.

The first comes fast—you’ll get to make every decision from day one. The second? That’s a long game. It takes building systems and a team that can operate without you in every file.

3. If it’s about legacy

A true legacy business doesn’t collapse if you take a month off. If your name is the only one clients ask for, you haven’t built a company—you’ve built a job.

Legacy means:

• Your brand brings in business without your personal hustle.

• Your team can close loans without your direct involvement.

• You have value to sell when you’re ready to exit.

The Real Mortgage Broker Startup Costs

Most people underestimate this part—badly. And I get it, because when you’re excited about the vision, spreadsheets aren’t the fun part.

Here’s a realistic breakdown for a small brokerage starting in one state:

Most brokers should plan for $20K–$50K in reserves before their first loan closes. Remember—commissions often don’t hit your account until 30–60 days after closing, so cash flow planning is critical.

The Risks No One Talks About

Owning a brokerage is exciting—but it’s also a leap into unknown territory.

Financial risk – Without reserves, one slow month can snowball into payroll problems or missed rent.

Legal risk – As the licensed broker, everything under your NMLS number is your responsibility. If someone on your team makes a compliance mistake, it’s on you.

Emotional risk – People will leave. Sometimes the ones you trained from scratch. It’s part of the game, and the sooner you accept it, the easier it gets.

How to Open a Mortgage Company: Step-by-Step

Here’s a basic roadmap to get from idea to opening day:

1. Decide on your model – Retail banker, mortgage broker, or hybrid.

2. Write your mortgage brokerage business plan – Include market analysis, target audience, products, financial projections, and compliance plan.

3. Meet mortgage broker licensing requirements – Complete education, pass tests, get your surety bond, and file your applications.

4. Secure funding – Personal savings, business loans, or investor capital.

5. Set up your legal entity – LLC, S-Corp, or C-Corp depending on tax and liability needs.

6. Choose your technology stack – LOS, CRM, credit reporting, e-sign.

7. Build your brand – Logo, website, marketing materials, social media presence.

8. Recruit your initial team – Start with roles that make you more efficient (processor or LOA) before adding salespeople.

9. Establish lender relationships – Apply with wholesale lenders and understand their pricing models.

10. Launch marketing & start closing loans – Focus on generating consistent lead flow from day one.

DIY vs. Mortgage Franchise Opportunities

You’ve got two main options:

I built Co/LAB Lending Franchise to offer a middle path—where brokers keep 100% ownership but tap into the infrastructure of an established operation. It’s what I wish I had when I started.

Frequently Asked Questions About Starting a Mortgage Brokerage

1. How much money do I need to start a mortgage brokerage?

Plan for $20K–$50K in reserves to cover the first 3–4 months. This includes mortgage broker startup costs like licensing, equipment, payroll, and marketing.

2. What are the mortgage broker licensing requirements?

Varies by state, but generally: pass the SAFE MLO exam, complete required hours of education, submit to background checks, obtain a surety bond, and file through the NMLS.

3. How do I write a mortgage brokerage business plan?

Include market analysis, loan product offerings, marketing strategy, staffing plan, and financial projections. Your plan should also outline compliance and risk management.

4. Should I start from scratch or join a mortgage franchise opportunity?

If you value speed and proven systems, a franchise may be best. If you prefer full control and have time to experiment, DIY is an option—just expect a longer learning curve.

5. Can I open a mortgage company while still doing loans?

Yes—but balancing production with building the business is tough. You’ll likely work more hours in the beginning until your team and systems are solid.

6. How long does it take to get licensed and open?

Most states take 60–120 days to approve your license, assuming you submit complete paperwork and meet all requirements.

7. What’s the fastest way to get my first clients?

Leverage your existing database, build referral partnerships with real estate agents, and run targeted online ads. Early marketing momentum is key.

The Bottom Line

Starting your own mortgage company is one of the most exciting—and challenging—career moves you can make. It can change your income, your lifestyle, and your legacy. But it’s not just about knowing how to close loans—it’s about knowing how to run a business.

Whether you go the DIY route or explore mortgage franchise opportunities, remember: speed comes from systems, and stability comes from cash reserves.

If you want to skip the years of trial and error, avoid the costly mistakes I made, and get to profitability faster, check out how Co/LAB Broker Concierge and Co/LAB Lending Franchise can help you launch with confidence.

Megan Marsh
Founder, Co/LAB Broker Concierge

In Case You Missed Our Previous Blogs & YouTube Videos..

Read Here: How to Add Commercial Loans to Your Mortgage Business | Grow Your Income in 2025

This blog reveals how mortgage brokers and loan officers can unlock a lucrative new revenue stream by adding commercial lending to their business. I share why now is the perfect time, what types of deals to target, the documents and skills you’ll need, and how to avoid common pitfalls. You’ll learn how to leverage your existing skills, expand your client base, and earn bigger commissions—without spending $10K on a course—through the proven systems and community inside The Lab.

Read Here: How Broker Concierge Helps Mortgage Broker Owners Avoid Burnout and Scale Fast

Feeling overwhelmed running your mortgage brokerage? This blog dives into the hidden struggles broker owners face—burnout, back-office chaos, and stalled growth—and introduces Broker Concierge by Co/LAB: a done-for-you operations team built to take those burdens off your plate. Discover how you can reclaim your time, reduce stress, and finally run your business like a true CEO. Whether you're just getting started or on the verge of burnout, this is the support system you didn’t know you needed.

Mortgage Broker Support

Need help starting your mortgage business? Our Mortgage Broker Concierge Team is here to assist you!

If you’re curious about how we can help you simplify your operations beyond what our videos offer and want to know how you can make launching or running your brokerage stress-free, the link below explains everything. No fluff, no “exclusive training” gimmicks—just a straightforward way to see how we work with brokers to take backend tasks off their plates. Check it out here: https://colablendingfranchise.com/book-a-discovery-call