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ISCOVER
Do you struggle with clients who are eager to supply documents and sign forms … but turn out to have flawed credit histories?
Or what about clients who have been late a few times to pay their current mortgage, although largely the mortgage is up to date? We’ve all had this happen, I am sure.
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The real question is: what do you do now? Tell them you’re sorry and come back when things are better? But maybe things won’t get better for your client without some assistance from you.
It is in this kind of situation where you really earn your commission. The reality is, non-conforming finance is not really that hard – if you want to do it.
I have spent my whole broking life in the non-conforming space (since 2003). Here are my top six tips for not only getting the loan across the line with the lender, but also, and more importantly, getting the loan across the line with your client.
1. Ask the next question of the client – you know, the question after the one where you think you have enough information. It is always after peeling back the onion and finding out more about your client and their predicament that you will find an answer that will connect the dots for the lender.
2. Most of the time there is an event or a back story to the application that will be the catalyst for the non-payment of debts or mortgage. Capture that story and convey that in your application to the lender. This is where you can show the client and the lender that you will take them from here (bad place) to there (think rainbows and unicorns).
3. Take file notes – lots of them. Sometimes the clients may be in their current awkward financial position because they have a nonchalant attitude to their finances. This is a good place to really capture who said what if you’re not already doing it.
4. Show some empathy! Sometimes this is the main thing people in a finance bind need. Listen to your clients as they will generally tell you how to go about applying by giving you the information, the back story. This is the reverse sell. If you listen to the client with a story to tell, finding them the solution and getting buy-in from them becomes the easy part.
5. Use your BDMs. I have found the assistance from most of the non-conforming BDMs to be great and generally punching above their weight. If you are looking for rate quotes, keep moving; this is not where you will get your value for money with non-conforming BDMs. It is their product and credit knowledge and the ‘how’ to get the loans across the line that you will find beyond value.
6. Adhere to the responsible lending laws (I know you all are), and double check everything. Make sure you are providing a benefit to the client. It’s no use taking a client from a big four bank to a non-conforming lender at a higher rate unless there is a benefit, such as cash flow or placing the client in a better position.
With the suite of lenders now offering a wide range of products, most non-conforming situations can be catered for in one way or another. I believe you should try to make the most of every lead given. Even though you will spend more time on a non-conforming application, the commissions can be better, which makes the effort worth it.
Of course, if you still think it’s all too hard, you can always refer the client to a non-conforming specialist … like me!
Stuart Styles, director, Arthurmac
Stuart Styles is the director of Arthurmac, a mortgage broker specialising in non-conforming finance and private funding. He was named non-conforming broker of the year in 2013 and was a finalist in the same category in 2012 and 2014.
