The commercial lending market has continued to see steady growth with potential for much more, presenting brokers with opportunities to expand their business, particularly in the areas of refinancing, negotiating with the current lender, and planning exit strategies.
Unfortunately, however, quite a number of brokers who deal with the residential market exclusively think commercial is complicated and time-consuming – a false idea that’s hindering some of them from achieving success.
“It goes to show that the only obstacle is flawed perceptions, but when we unlock a new level of confidence with commercial lending, we open up new opportunities for brokers,” said Barry Saoud, Pepper Money’s general manager for mortgages and commercial lending. “It’s about helping the broker realise what they are capable of doing.”
Read more: Harnessing disruption in commercial lending
Education need not be formal. It can be as simple as a chat with a non-bank BDM.
“We do sessions on real-life case studies, and even a simple ‘coffee with credit’ – having a coffee with our credit managers and talking about how they look at a transaction,” Saoud said.
Thinktank offers a range of face-to-face education sessions to empower brokers to branch into commercial and other areas. Relationship managers (RMs) are also there to support brokers with transactions from inception to settlement.
“It’s why there are no minimum volume or experience requirements to commercial loans with Thinktank, as our RMs are there alongside the broker every step of the way,” said Peter Vala, general manager partnerships and distribution at Thinktank.
Many alternative lenders enable brokers to upskill on commercial lending through regular education workshops and seminars.
“This includes how to spot opportunities, along with helping implement strategies brokers can implement to support their client base – which was the genesis of the Commercial Market Update live webinar held on March 24 in collaboration with Lumi, Accendo Financial, and VeloxCapital,” said Matthew Porch, Aquamore head of distribution.
Another good strategy is to develop links to the commercial sector.
“We are proud that most of our work comes from word of mouth, so keeping the conversation going with our network is key,” said Dean Koutsoumidis, managing director at Equity-One. “We help our brokers walk through the transaction and try to deal with obstacles before they crystallise.”
Demand for knowledge and service in the non-bank commercial lending area is tipped to grow as major banks continue to offer less-flexible products in a challenging economy.
“Who better to help navigate that transition than brokers?” said Cory Bannister, chief lending officer at La Trobe Financial. “This is where we see significant opportunity in the years ahead.”
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