Having previously struggled with his own finances due to health problems, taking the time to learn the ropes of specialist lending holds significant meaning for this broker.
How and why did you start in specialist lending?
I had health problems in the past and needed advice around debt solutions, finance and how to manage debt collectors. I managed it all myself, learned how to manage and negotiate debt and the intricacies of debt collection and so forth. I then resolved it all myself and what I learned through that process I took into lending and set up the non-conforming side of Loan Saver Network.
I’m very interested in helping clients that are essentially going through what I went through prior to being in lending. The client-base that I work with now have similar needs and frustrations with both sourcing a lending solution and their predicament. Because of my history I have a good understanding of the clients and as an additional benefit - I do enjoy the work.
How much of your business is specialist?
Around 80 per cent of my business is specialist lending, ranging from mortgage arrears, debt consolidation, tax debt, clients with judgements, defaults or some form of bankruptcy.
Who do you write loans for?
I’d say out of the specialist lending that we do, there are 70 per cent self-employed and 30 per cent consumers.
How have you found the market in the last year?
People always find themselves in trouble for one reason or another but the differences in the market at the moment, is that lenders are tightening their policies, so it's just going to get busier and supports our debt strategy advice approach.
What is the most rewarding part of your job?
On a regular basis I see clients who can't see a financial future for themselves. They are focused completely on the issues at hand – whether it be mortgage arrears, a pending bankruptcy, court action or they simply cannot source finance.
When we resolve their problem with finance, and reduced their payments by $1,500-$2,000 a month or have prevented a bankruptcy, they're able to plan and project what they want to do next. We consistently get reviews and letters from clients thanking us for the work that been done and the support given. I find this a fulfilling part of the business.
Do you see more brokers coming into specialist lending?
I don't know – things are getting more and more specialised and time consuming. In the non-conforming sector, you have to charge a fee based on your hourly input of work because there’s substantially more work involved than a prime home loan.
As a broker, there are a lot of discussions around fee for service, along with cultural change required in the industry - prime lenders are still averse to fee for service. I feel the additional work plus not using a fee for service model will keep brokers writing in the prime sector.
What advice do you have for brokers coming in to this area?
I’ve heard from some clients that they’ve been to brokers previously who have had a negative perception of them because of a credit default. The body language or even vocabulary indicates ‘I don’t like this client’. So, I'd probably say, ‘Understand the client, understand their situation and how that situation occurred’. Then offer a full rounded solution and you'll have a client for life, not just for the immediate specialist lending you write, but also for the prime finance in the future.
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