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Break into commercial by leveraging your existing book

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John Kolyvas 5 minute read

Increased regulation by APRA designed to curb residential mortgage growth has seen many lenders tighten their lending policies, particularly in regards to investors. As a result, commercial lending offers an alternative customer value proposition that could deliver sustainable benefits for your business.

There’s never been a better time to diversify into commercial mortgages. And the good news is you probably already have untapped resources at your fingertips to help leverage your existing book.

Look at your current client base
Start with your residential clients as potential leads. Many may be business owners or have a history of commercial lending, so be aware of indicators in business bank statements that could suggest an interest in asset finance or commercial borrowing.

Talk to your existing residential investors who have accumulated a large property portfolio. If they are continuing to invest, it may make sense for them to diversify their property assets by entering the commercial investment space.

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Update your marketing material
Let people know you’re entering the commercial mortgages space so they are aware of your updated offering.

Start by spreading the word through your regular communications channels: update your website, social media, your marketing assets, business cards and so forth.

Once you have identified potential commercial clients, keep in touch. Regular proactive communication with newsletters or social media can help to keep your service proposition front of mind. However, keep the content relevant by segmenting your client base and directing your commercial communications to the most appropriate audience.

Create a referral network
Make the most of your external professional relationships.

Network with accountants and solicitors in your area and let them know you’re entering the commercial lending market. Business owners tend to engage with their accountants frequently, so they are an excellent first port of call if you want to generate new business referrals (and offer referrals in return).

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Your local Chamber of Commerce, business networking groups or industry events are all valid ways to make new contacts that can help you get the word out – or establish your own business referral group.

Entering the commercial lending space may feel like a step outside your comfort zone. But, amidst the transforming property investment landscape, diversifying your business could deliver long-term rewards for both you and your clients.

Break into commercial by leveraging your existing book
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John Kolyvas

John Kolyvas

John Kolyvas is the national partnership manager of third-party commercial at ING Direct.

 

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