Pepper Money removes clawbacks on commercial mortgage loans

Lender keen to attract growing number of brokers who have diversified

Pepper Money removes clawbacks on commercial mortgage loans

Non-bank lender Pepper Money has removed clawbacks on all commercial mortgage lending products as of February 1, 2023.

In a bold move aimed at highlighting its commitment to brokers, Pepper Money says it’s also simplifying fee structures on commercial products to make Pepper Money easy to do business with.

The removal of clawbacks and simpler fee structure follows strong signs the commercial property market is positioned for growth.

The number of mortgage brokers writing commercial finance loans has continued to increase by almost 15% (October 1, 2021, to March 31, 2022, period PCP) to a new high, according to the MFAA Industry Intelligence Service 14th edition report. The report also revealed the value of commercial loans settled by mortgage brokers recorded its highest ever value at $15.98 billion, up $5.71 billion or 55.5% year-on-year.

“Commercial lending settlements have accelerated, borrower profiles are shifting, and Pepper Money is committed to supporting brokers to meet the growing demand by removing commercial lending clawbacks on early payouts,” said Pepper Money general manager mortgages and commercial Barry Saoud (pictured above left).

“We’re backing the growing number of brokers that are diversifying their offering and supporting another SME’s business. There is no substitute for the commitment brokers provide to their SME clients, so we have taken this step. We listened, so we know this is a welcome change for our broker partners who are writing commercial deals.”

Saoud said the non-bank had also simplified its fees and reduced legal charges.

Brokers have welcomed Pepper Money’s removal of clawbacks and a streamlined fee structure for commercial loans.

“Pepper has made it easy to do business with, from removing clawbacks, reduced fees, flexible options, and allowing brokers to talk directly to our credit managers,” said Pfitz Financial and Business Solutions director Sonja Pfitz (pictured above centre).

“This is really important to ensure we as the broker are able to tell that customer’s story directly to the credit manager if there are any questions. It’s great to see Pepper stand by commercial brokers every step of the way.”

Andrew Psalti (pictured above right), a senior Lending Adviser at the Lending Association Queensland, said the brokerage “loves dealing with alternative commercial solutions that make sense”.

“Pepper Money gives us just that,” Salti said. “The removal of clawbacks and reduction in legal fees will only make the offer more compelling.”

Given the growing demand for commercial lending, Saoud said Pepper Money had also increased its ability to fund both non-metro and metro areas, providing more opportunities for brokers and customers nationwide.

“There’s never been a better time for mortgage brokers to expand their knowledge, develop new skills and diversify to include commercial property loans,” Saoud said.

Pepper Money national sales manager commercial Ben McKell said with more than 20 years of specialist and SME knowledge, dedicated BDMs around Australia and a “real-life approach to making deals happen”, the lender’s updates were a game changer for business owners and brokers.

“Customers can get greater access to equity through higher LVRs and cashflow flexibility with longer loan terms,” McKell said. “Unique features include 100% offset sub account, unlimited free redraw on variable loans, and online banking tools. We are one of the few lenders in the market with this offering.”

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