In the rapidly evolving lending landscape, Rishi Bhatia has been moving with the times and expanding his service offering to clients. In this Q&A, we find out how and why he’s been writing more self-managed super fund loans and what he’s focusing on this year.
How and why did you become a broker?
I started in 2015. It's ironic, because I bought a couple of investment properties and I remember calling the broker a week before the settlement saying: ‘Hey, I haven't got the loan docs yet’ and getting radio silence on the other line. He’d forgotten! We didn’t settle and we had late payment penalties, the whole lot. I had that terrible experience and thought: ‘I can do this better’.
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At that same time, one of my mates - who was a buyer's agent - needed a good broker, so he suggested I become one.
So it was an amalgamation of all these [that made me choose broking]. They say: ‘When you want to make something happen, the world makes it happen for you!’
I was just doing it part-time at first and then in 2021 I said goodbye to my other job and went full-time.
What type of loans are you now writing at KRIA Mortgage Managers?
I started off as a residential mortgage broker but now we are a fully-fledged, full-service brokerage. So it's residential, commercial, SMSF, asset and equipment loans… it’s multifaceted.
Why did you start writing SMSF loans?
It started with one of my customers initially saying: ‘Hey, I'm buying a property under the super. Do you write SMSF loans?’ And as a young new broker, I said: “Yeah, I do everything, of course’... It was luckily he was buying it and settling in six months so I had the time to learn everything... I’ve been really lucky with great customers who've given me a lot of leeway.
Are you seeing more demand for SMSF loans?
I think it's picked up over the last two years. Customers have told me that they might be capped out on the investment lending side of things, because of the interest rates and so on and so forth, and are looking at where else they can we borrow. These are typically high-net-worth individuals or families who have wealth sitting in super. They still believe in property, so they want to buy it under the super. When rates were still in the 2-3 per cent ranges, they would be buying under their family trust structure or their individual names but now they’re capped out, they’re looking for more opportunity.
How did you learn to write SMSF loans?
I taught myself. But I'm also the kind of a guy who is consuming knowledge. I bought this book called SMSF for Dummies to learn all about it and understand what the financial planner is thinking. I’ve also read Tax for Australians for Dummies, just to help me understand structures. You’d be surprised how many mistakes we’ve found from accountants and financial planners after reading them! They've input the wrong ABNs or the wrong structure in a bare trust. They've made terrible mistakes. I've gone back to the accountant or financial planner and humbly said: ‘I’m not an expert but can you relook at this?’ And they've come back and said: ‘Thanks for pointing it out’.
What kind of properties are SMSF borrowers looking at?
I'm seeing a lot more commercial within the super. People are borrowing just the certainty -they like having long leases with 6-8 per cent yields. And with some of the lenders, we're getting 80 per cent lending, so they're very bullish on commercial.
What other types of loan writing will you focus on this year?
This year, the focus is on SMSF lending so I'm educating myself a lot more. I'm talking to a lot more lenders - and there are a lot more lenders coming on board as well. There's also a bigger focus on asset finance for me… we had such a massive push on asset finance because of the tax incentives and, as 30th June is coming up again, the first half of the year is a push on asset and equipment finance.
You can find out more about Rishi Bhatia and his top tips for brokers in The Adviser's Elite Broker podcast.
Tune in to the episode with Rishi, Why Rishi Bhatia’s brokerage is all about good work, here:
[Related: Why Rishi Bhatia’s brokerage is all about good work]
