“Credibility with your private lenders ensures that your applications will go to the top of the stack – and credibility is built by being respectful of the private lender's time,” says Michael Anger, sales and marketing, investment account manager and mortgage agent with Paramount Equity Financial Corporation. “Sending irrelevant deals (commercial deals to a private lender who only does residential, for example) will lose you credibility.”
No private lender enjoys going through the time, cost, and effort of reviewing and underwriting a deal, Anger told mortgagebrokernews.ca, “requesting further documentation, and drafting up the mortgage documentation, only to have the application cancelled because the broker took it somewhere else in the end.”
Anger is one of many who weighed in on CMP magazine’s in-depth look at the private lending space in the upcoming summer issue.
And the space is growing and diversifying.
The number of private lenders that are quasi-institutional such as Mortgage Investment Corporations (MIC) has increased over the past decade. Additionally, many more private individuals have turned to private mortgage lending as a way to earn more on their investment portfolio than they can in traditional GICs and riskier stocks.
For broker success in the space, the formula is a simple one, says Anger.
“Work respectfully with your private lenders,” he says, “and they're more likely to give you the responsiveness and fast approvals that you're looking for on behalf of your borrowers.”
Opportunities for brokers in the private lending space are there – but the broker needs to step up or risk losing that valuable connection.