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In 2023 borrowers are facing the prospect of more rate rises and borrowing capacity constraints. Brokers who can help their clients find the best solutions and most competitive rates are the ones likely to get ahead. Assetline Capital’s Royden D’Vaz explains why.
With over 25 years in the industry, Assetline Capital’s Head of Sales and Distribution Royden D’Vaz has seen market challenges come and go. But he believes the lending landscape has never been as complex as it is now.
“The number of straightforward deals is shrinking,” he says. “Interest rates are rising and banks are scrutinising debt to income ratios - putting borrowing capacity under stress. Brokers are facing more challenges than ever before when it comes to placing deals, even previously vanilla ones.”
Cost of living pressures, rising rates and borrowing capacity constraints mean borrowers are also more price-aware than they have been in the past. This means that for brokers, finding the most competitive deals and product fit is about more than meeting best interest duty obligations, it’s critical for client retention.
With competitive rates as well as flexible income verification, a lender like Assetline Capital is well positioned to help.
“Our alt-doc rates on a long-term Horizon Mortgage are among the lowest in market starting at 5.84% on 60% LVR,” D’Vaz explains. “And with the option to use an accountant’s letter to verify income, we can often help business borrowers where other lenders can’t.”
Increased competition brings opportunities
According to MFAA research, brokers have written a record 71.1% of all new residential loans in the last quarter. But while broker market share may be higher than it’s ever been, supply in the residential property sector is low – which means loan volumes are down. And with fewer deals, the competition is greater – putting more pressure on brokers to access effective, reasonably priced solutions for their clients.
Assetline Capital is here to support brokers in any way it can, as D’Vaz explains.
“In addition to our very competitive rates, our policies are designed to meet the needs of today’s business borrowers, SMSFs and property owners. We offer an aggregate max of $5m per borrower and a five-year interest only period on all our long-term Horizon Mortgage products, including SMSF. Also, we don’t impose clawbacks - so you can have certainty around your income.”
Do more for your clients with a lender that offers more options
Many brokers feel they spend too much time on admin and less time than they would like on educating clients and helping them get the best deal – a priority for 53% of brokers, according to a 2022 Equifax pulse check.
This problem is compounded by the need to build relationships with dozens of lender BDMs and get across multiple lender policies. Partnering with a lender that has a full suite of products can save time and admin. It also makes it easier to implement a combined strategy.
With its full suite of products, Assetline Capital makes it easier to switch between different loans, including short term capital or construction capital into a long-term Horizon Mortgage or SMSF mortgage.
“Wherever we can, we’ll look for a way to help,” says D’Vaz. “And we’ll make the process as seamless as possible – especially when compared to moving between different lenders.”
The result? Less stress for brokers, more certainty for their clients.
So where do the opportunities lie?
While residential loan volumes might be down, there are still plenty of opportunities for brokers who are willing to diversify.
D’Vaz suggests brokers educate themselves on the types of loans they might have referred on in the past will benefit the most, like SMSF, construction, short term commercial and residential bridging.
“In 2022, nearly a third of brokers wrote commercial property loans so we’re definitely seeing opportunities emerging in the commercial space,” explains D’Vaz. “We’re also seeing an increasing number of borrowers looking to invest in their commercial premises or buy property through their SMSF.”
While they take the same amount of work, commercial and construction deals often attract higher commission revenue for brokers than residential loans, making them an ideal way for brokers to build a strong income stream.
“Diversification can help you broaden your client base and enable your clients to tap into a wider range of solutions than they had before,” says D’Vaz. These include long-term loans like Assetline Capital’s recently launched Horizon Mortgage and short-term finance like the non-bank lender’s clinch bridging loans.
Expanding your loan book is easier when you partner with the right lender.
“We can educate brokers on how to do a commercial or SMSF loan, so they don’t have to hand those deals off to someone else. You don’t have to figure it out on your own, we’ll walk you through it,” he adds.
While 2023 will have its challenges, with the right lending partner by their side, brokers can position themselves to build and retain a strong client base. And with its recent addition to the Loan Market, Choice Aggregation and Plan panels, Assetline Capital’s diverse range of solutions are now available to even more brokers.
To find out more about Assetline Capital and learn how our full suite of products and market-leading rates can help you diversify your broking business, please get in touch.
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