Smartmove’s Simon Orbell explains why brokers need to emotionally sell specialist lending to their clients
What triggered your decision to start offering specialist lending through Pepper?
There are two main factors that drove that.
Our general manager Darren Little, who came on board at the start of 2014, had a great working relationship with Mario Rehayem from Pepper. Through that – and Mario developing a close relationship with my business partner David Brell – Mario presented a ‘how to’ guide on presenting and positioning specialist lending to your customers in certain situations where it’s required. We’d only really been providing specialist lending on an ad hoc basis prior to that, and we hadn’t really understood how to position it for customers.
Off the back of that presentation we got a much better understanding of how that should be done, and we started to develop that relationship more closely with Pepper.
What are the biggest differences between the specialist lending process and that of more traditional loans?
With specialist lending it’s probably less about process and more about solutions. It’s not necessarily ‘ticking a box’ like it is with a lot of the more traditional lending that we organise. It’s more about boxing it up and presenting it, and focusing on your submission quality.
In your experience, is there a typical specialist lending client profile?
There’s not really a typical profile. You can have certain situations where you might have a business owner who’s had absolutely impeccable credit for a number of years but is going through a tough period in the business, or has a business partner who’s going through a divorce. There might be certain situations where that then means there are a few blemishes on the file or blemishes on the actual accounts that they’re trying to get refinanced.
There’s also other end of the spectrum where you have a client who’s just a little bit more tardy in the way that they manage their finances. So, in my experience, there’s not a typical specialist lending client profile and I suppose that’s the beauty of specialist lending – that you can have such wide-ranging circumstances and wider solutions.
Are there any misconceptions about specialist lending that you would like to see dispelled?
That it’s difficult and that it’s expensive. They’re two words that are very difficult to quantify when it comes to situations where you’re having a partnership breakdown or a divorce and you’re trying to save the home.
You’re happy to spend a little bit more in that situation – there’s that emotional side of the equation. You might be able to try and save the business, for example. These specialist lenders help those businesses to continue to go forward.
So saying that it’s difficult and expensive, it’s actually cheap for those people when you consider the context – it’s just how you look at it.
What does that changing lending landscape mean for specialist lenders?
I think it’s a huge opportunity for them. I think that growth in that sector will continue to be strong. Obviously the more difficult that APRA makes things – and that lenders then have to make things because of the APRA restrictions – I think it only provides the opportunity for specialist lenders to niche themselves and really position themselves as a ‘specialist’ alternative.
Simon Orbell, Smartmove, Neutral Bay, NSW