Business is booming for commercial lending specialists - so how can residential brokers make the leap into the space?
Video transcript below:
Donna Sawyer, Australian Broker News TV
Donna Sawyer: Hello, I am Donna Sawyer and you are watching the Big Story on Australian Broker News TV.
Business is booming for brokers in the commercial lending space, that’s the resounding message from brokers who say there is no sign of business slowing down even in the face of another potential global economic crisis.
Ranjit Tambyrajah, Acuity Funding
Ranjit Tambyrajah: The commercial arena is an arena that has to be touched, you just can’t ignore it. Specially with residential broking being a little bit oversupplied at this time and banks are not necessarily rewarding brokers as they once did. And so for a broker, it is really important to partner themselves with an expert in field.
Cathy Dimarchos, Sintex Consolidated Pty Ltd
Cathy Dimarchos: There seems to be quite a nice vibe actually being generated in the marketplace particularly in the non-bank sector. We are seeing quite a lot of brokers who are approaching Sintex to become accredited and that is a new space for us, so opening the doors to brokers. What’s been really interesting is also seeing that rejuvenation of business, also coming back from our mortgage managers. So there’s been a bit of a low in the commercial space for them, but we are seeing them actually you know I guess being approached by consumers for commercial businesses as opposed to them going back to them to the banks.
Iain Forbes, Australian First Mortgage
Iain Forbes: Think to diversify into commercial lending, think bit different leasing and hire purchase, make your business a one stop shop.
Donna Sawyer: Ranjit Thambyrajah of Acuity Funding says he is not convinced the market would be affected by another global downturn, but it may actually create more business opportunities.
Ranjit Tambyrajah: I think we are in good times for commercial from a broker’s point of view. If you have a client, clients aren’t finding sourcing finance that easy, so that’s a good thing for a broker and the clients are keen to get specialist knowledge.
Cathy Dimarchos: I don’t think that there is really any sort of I guess conservatives around what may or may not happen. People still need to actually conduct their business as per usual so people are looking to you know either start to expand what they’ve got in existence.
Donna Sawyer: So how can brokers make the leap into the commercial lending space? Cathy Dimarchos of Sintex Consolidated says start small.
Cathy Dimarchos: Commercial lending can be difficult, if you are trying to make a leg from being a residential broker, say into the $20 million development deal. But that’s not what commercial deals we actually look at. You know we are looking at the small business, Mum and Dad business, so it’s no different to your home loan that you would be normally be looking at, so I would definitely be encouraging people to open up their minds and take the opportunity to venture into that small ticket commercial stuff.
Ranjit Thambyrajah: I have been doing this for a good part of 30 years and I am still learning. So I think it’s, people have to realise that to be good at commercial you just need to be patient and be keen to learn.
Iain Forbes: It’s a matter of diversification and at the end of the day, it’s extra income. Commercial is not difficult, particularly when you have a lender at the other end of the phone who takes away the hassle. If need be, we would talk to your client, we will come and meet with your client and structure that deal to meet your client’s requirements. That’s my advice to all brokers. Think commercial.
Donna Sawyer: For more on commercial lending and other industry news, click around the Australian Broker News website. I am Donna Sawyer and I will see you again next week with the Big Story.