Lender slams "myths" around custom lending

by Rebecca Pike21 Jun 2018

Brokers are being asked to become “community champions” as one specialist lender debunks the myths around custom lending.

While some mortgage brokers are sceptical of taking on custom clients, specialist lender Liberty is an advocate for doing so.

The lender says it has seen growing numbers of people denied loans by traditional lenders, for reasons such as employment type, credit impairment or loan purpose.

Group sales manager John Mohnacheff says it is vital that brokers do not turn people away who are in need of financial solutions. But many brokers believe that custom loans will increase their workload, whether by paperwork or extra processes.

"First and foremost, if you’re going to call yourself a broker, then you ought to be trained in every form of home loan there is,” Mohnacheff says.

"If you’re going to say, I am a mortgage broker, you can’t say I only do basic loans.

"There might be a misunderstanding or a misconception that custom loans are difficult to do, but purely and simply it’s a home loan. The individual’s circumstances are a little bit different to what we regard as a prime loan, but that’s it.

"At some point in life, any borrower can find themselves in difficulty whether that be marital, financial or personal. For example, no one struck with a major illness prioritises their home loan over their medical treatment,"

With many lenders only offering loans to customers who meet standard criteria, many brokers may refuse to take on clients mistakenly thinking options don’t exist. Mohnacheff stresses there are options - such as Liberty, that can help customers even if they don’t fit the typical borrower profile.

"You’re in the business of helping people get a home loan. We need to lift the professional standards of brokers. If you don’t want to help customers, if you don’t want to help them improve, don’t call yourself a mortgage broker.

“That person has come to you and saying you are unable to help is just not acceptable in this day and age, not with the resources and the options available to brokers.

"Brokers need to stand up and say I am the champion of people in need of financial help. Become a beacon and you will attract business; these people are looking for solutions. It’s a wonderful point of difference to help people others are unwilling to help."

 

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