A new specialist lender has entered the Australian mortgage market with a proposition that could reshape how brokers fund growth: loans secured entirely against trail income, with no property required as security.
Broker Funder, established by alternative finance specialist Angus Young in collaboration with industry veteran Nick Young — founder of Trail Homes — has launched with Loan Market Group as its first aggregator partner.
The timing reflects the industry's growing scale. Brokers now write 76.7% of new residential home loans — a record $142.20 billion in the December quarter, according to the MFAA — making trail books an increasingly valuable business asset.
"Broker Funder's primary focus is supporting the next phase of industry growth through a 'self-funded' model that enables brokers to leverage their trail books to fund acquisitions, business expansion, staffing, working capital, debt consolidation, refinance tax liabilities, and so forth," said Angus Young (pictured), founder and CEO. "This structure provides brokers with the dual benefit of a capital injection without encumbering other assets."
Loans range from $50,000 to $500,000, assessed at a 2x annualised revenue multiple with up to 70% LVR. Facilities are structured as principal and interest loans over one to five years through a low-documentation process, with approvals and settlement achievable within a week.
The self-funding nature of the model is its most distinctive feature. Young outlined a worked example: a broker generating $10,000 in monthly trail looking to acquire a book of equivalent size could access upwards of $335,000 in funding, with indicative P&I repayments of approximately $8,000 per month over five years — effectively meaning the acquired trail book services its own purchase cost.
The facility also allows early repayments without significant penalties, providing flexibility as businesses grow or transactions settle sooner than anticipated. Young noted it may also carry tax and cash flow advantages for brokers using it for acquisitions or growth — though he recommended consulting an accountant.
LMG's decision to partner with Broker Funder reflects a broader shift playing out across the industry.
Ewen Stafford, executive director and CEO of LMG, pointed to growing momentum around succession planning and consolidation as the key driver.
"Across LMG and the wider industry, we're seeing strong momentum around succession and consolidation. Established brokers are exploring transition pathways, while a new generation of brokers is looking to acquire and grow existing businesses," Stafford said.
Broker Funder's trail-backed model offers one practical response to that challenge. The facility is positioned as an alternative to traditional commercial finance, which typically requires property as security, or unsecured lending, which generally carries materially higher rates.
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