ISCOVER
More brokers are exploring opportunities in commercial and asset finance as the residential lending market becomes increasingly saturated.
As the share of broker-written mortgages keeps climbing to ever-growing highs, more brokers are diversifying into commercial and asset finance to explore opportunities away from an increasingly crowded market.
While the commercial and asset side of broking is not as mature as residential, it is growing strongly as brokers look to diversify, according to the Mortgage and Finance Association of Australia (MFAA).
Earlier this year, the industry body revealed the value of commercial loans settled by mortgage brokers had risen to its highest level on record.
Commercial mortgages were written by 37 per cent of brokers in the year to April 2025, with an additional 28 per cent planning to start offering them over the next 12 months, according to new Agile Market Intelligence research.
Business loans also continue to build momentum, with 26 per cent of brokers active in the past year and 23 per cent signalling intent to start writing them in the next 12 months.
The third-party channel’s ongoing dominance of the residential finance segment is making many brokers eager to explore other opportunities in commercial, business, and asset finance.
Why diversify away from resi?
Brokers such as Marco Conciatore at MDC Finance Group, have made a conscious effort to target residential, commercial and asset financing.
Speaking to The Adviser, Conciatore said his diversified business offered chances to cross-sell.
“Mine's more about the one stop shop,” he said.
“Right now, I'm [working on] a whole manufacturing $7 million equipment finance loan, and he [the client] needed trade finance, he needed cash flow loans, he needed balance sheet loans, and stuff like that. So not only did I do the home loans for the children and everyone else, but I did the business side of things.”
Derry Tanzil, founder of the mortgage brokerage Derry and Co, shared with The Adviser earlier this year that he planned to expand his business beyond residential lending.
“To grow my business, one of my plans in the next five years is also to diversify my business.
“Winning more business in commercial loan space and car loans as well. I want to better equip myself with more knowledge in commercial loan and car loan.“
Conciatore said he was seeing more resi brokers explore options in commercial broking due to opportunities in the space.
“I think there's a lot of resi brokers. They're trying to verge out into the commercial world… I speak to other brokers and I try to educate them or push them to diversify themselves into the commercial field, because that's where it's all heading.
“If you have a home loan client and you're only a resi broker, you're probably gonna eventually lose them because someone like me might come up and I can do his resi, I can do his commercial, I can do his equipment finance, I can do everything, and then you're taking the whole share of wallet.”
The commercial lending learning curve
Commenting on challenges for brokers delving into commercial lending, Conciatore said: “I know a lot of commercial brokers that like to just do resi because resi is simple. It's easy. You get paid. There's no headaches. Commercial, you have to invest time.”
He added: “[My most recent deal] took me nearly a year with these clients, back and forth, KPMG accounts. It's very time consuming.”
Conciatore highlighted gaps in experience, understanding of terminology, and the ability to interpret financials as common pitfalls holding back those trying to break into commercial broking.
He also noted a gap in the market for brokers who are skilled in both residential and commercial lending.
“I believe that there's commercial brokers, [and] there's resi brokers. I don't think there's a lot of resi and commercial brokers in one… For me, that's my target market.”
Banks “in my hand drooling”
Conciatore explained that commercial broking was more lucrative than solely writing residential loans and allowed him to secure better deals for his clients.
“I personally wrote a $30 million commercial loan. But I had National Australia Bank (NAB), I had Commonwealth Bank of Australia (CBA), I had Westpac, I had Australia and New Zealand Banking Group’s (ANZ) all in my hand, really drooling.
“And the reason why I had them in my hand drooling is because they all wanted the business. I really took advantage of that when I got the best [deal] for my client.”
To hear more about how brokers can become partners to business clients, come along to the SME Bootcamp 2025. The event will be held in the following locations:
- 11 September at Sofitel Melbourne on Collins in Melbourne
- 16 September at Mantra on View, Surfers Paradise on the Gold Coast
- 18 September at Le Montage, Lilyfield in Sydney
Click here to register for the free event.
[Related: Record number of mortgage brokers diversifying into commercial]
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