There was a time when the term specialist lending carried negative connotations. But the days of these loans serving only as a last resort for credit-impaired borrowers have long passed.
Today, specialist lenders provide solutions for a range of scenarios that fall outside the boxes of traditional lenders, from self-employed business owners with variable income to expats with offshore earnings and investors looking to manage multiple securities.
In many of these scenarios, the key to making these deals work is being able to take an open-minded approach – one area where the non-banks have an edge.
Speaking to The Adviser, Lucy Blain, director and broker at ACT-based brokerage Blain Financial, said this ability to look at the deal in front of them rather than try to force it through standard policy has enabled non-banks to fill a gap in the market.
“More and more, we are looking left of field to find solutions to reach a client’s outcomes,” she said.
“You can have a fantastic borrower with strong income, good assets and a quality transaction, but if it sits outside a bank’s appetite, it’s simply a decline.
“Specialist lenders give brokers options. They create competition, they support more complex borrowers, and they make sure good clients don’t miss out simply because their circumstances are a little different.”
Tim Lemon, national sales manager at non-bank lender MA Money, told The Adviser that this nimble approach to credit assessment is a key advantage, with specialist lenders able to consider the individual circumstances behind each application rather than relying solely on automated decision making or rigid policy settings.
“This flexibility is particularly valuable for self-employed borrowers, customers with multiple income streams, or those whose financial position isn’t easily reflected in standard lending criteria,” he said.
“With cost of living pressures continuing to impact Australian households, we’re also seeing more customers looking to consolidate debt or manage outstanding tax debt.
“These borrowers may still have strong repayment capacity but need a lender willing to understand their broader financial picture.”
Another advantage of non-banks in the specialist space is their ability to provide borrowers with a way to simplify complex debt arrangements.
In a recent appearance on The Adviser’s In Focus podcast, Aaron Taylor, head of non-standard lending at Bluestone Home Loans, said the specialist lending segment has helped many borrowers find a pathway back to the mainstream lenders.
“I think the brokers that have really taken advantage of the space the last few years are doing a really good job of explaining what the lifespan looks like,” he said.
“What’s the plan from here to there – you’re in this position, you’re struggling with repayments and you’ve got 15 different debts. We’re consolidating those debts into one repayment and we’re going to this lender because they’ve got the policies to be able to support today.
“And then after three months I’m going to check in with you. After six months, we’ll make sure you’re still on track and by the 12 month mark we can start making a plan for moving you back to a mainstream position.”
Technology lowers the barriers
Part of what may have made some brokers reluctant to explore the specialist lending is the complexity involved, with areas such as self-managed super fund (SMSF) lending, alt-doc deals, and complex commercial scenarios sometimes requiring extensive policy knowledge.
Regulatory changes can make the landscape even more challenging, with the government’s ban on new limited recourse borrowing arrangements (LRBAs) for residential property inside SMSFs set to reshape the market from 10 August, providing a good example.
However, technology is beginning to remove some of the complexity traditionally associated with specialist deals.
For example, in April 2026, technology platform Quickli reported a sharp rise in broker engagement with specialist lending tools, with alt-doc product recommendations jumping 124 per cent in March 2026 and SMSF exports rising 56 per cent over the same period.
The platform, which launched its alt-doc tool in October 2025, said the uplift pointed to a shift in broker behaviour, with more advisers actively pursuing specialist lending opportunities rather than referring deals out or avoiding them altogether.
Quickli co-founder and co-CEO Eric Dill said access to the right tools is proving critical to unlocking these scenarios.
“There are brokers out there who’d write more alt-doc and SMSF deals if they had the right tools,” he said.
“These aren’t mainstream lending scenarios, so brokers need confidence they’re getting the requirements right.”
What’s next in the specialist space?
Much will depend on macro-economic forces and rate movements, but the market should provide opportunities for brokers who can work with specialist lenders, according to Taylor.
“Ideally, we’ll be able to start to see lower interest rates next year,” he said.
“We’ll hopefully see some businesses really start to grow and we look at all these self-employed people that have come out over the last 12, 18 months and next year, the year after, hopefully we’re starting to see some really, really good tailwinds for them.
Once you explain why that lender is being recommended and how the structure works, they’re generally very comfortable. They’re buying the solution, not the logo on the building or the banking app”
- Lucy Blain, director and broker, Blain Financial
“And that’s where the alt-doc space will really take off. I think we see some really strong points across some of our lenders in this non-bank space which can support those alt-doc solutions for customers looking to use BAS or bank statements rather than going through with the mainstream lender and getting tax returns and that sort of space.”
Meanwhile, Blain said client attitudes towards specialist lenders are also changing as brokers become more comfortable explaining the rationale behind their recommendations.
“They’re specialised transactions and not every bank wants to play in that space. The majors seem to look at this, but not from a broker lodged loan perspective,” she said.
“Clients are usually cautious initially because they don’t recognise the brand. Once you explain why that lender is being recommended and how the structure works, they’re generally very comfortable. They’re buying the solution, not the logo on the building or the banking app.”
For Lemon, specialist lending is all about looking beyond the numbers.
“We take the time to understand the reason behind a customer’s circumstances and structure a responsible lending solution that supports their needs,” he said.
“By complementing the traditional banking sector, non-bank lenders increase competition, expand access to credit, and give mortgage brokers more options to help their customers.”
