Diversification can be a broker's best friend

In a post-pandemic economy, diversification can be a broker’s best friend, according to Loan Market.

In a recent column for MPA, the brokerage firm talked to some of its brokers about how commercial and asset finance diversification had jump-started their business.

Loan Market broker Heath Williams, who spent nearly a decade in car dealership before becoming a mortgage broker, said expanding into auto finance had increased his retention rate.

“Statistics show that six months after a client makes a home purchase, they start to think about upgrading their car,” Williams said. “We’re making six-month follow-ups at the moment, and the reception has been very positive.”

Asset finance specialist Alan Walker has been working with Loan Market brokers for years. Walker said both he and his referral network benefit from the relationship. The referring broker maintains their client connection, while serving the client’s lending needs.

“Ninety-nine per cent (99%) of my referrals come from Loan Market brokers,” Walker said. “One of the big challenges that mortgage brokers have is getting accredited with commercial lenders. Instead, they can send the client to me, retain their relationship with their client and earn a referral fee payment at the same time.”

Read next: Loan Market introduces new broker success team

Expanding services beyond mortgages strengthens the “trust and relationships” brokers have already built with their clients, said Stephen Scahill, Loan Market group executive for commercial and asset finance.

“We have an expectation that every broker will be involved in asset and commercial finance in some capacity in the future, whether that be writing directly themselves or accessing a trusted referral partner to ensure customer needs are met,” Scahill said. “The trust and relationships with brokers is there to continue to drive growth in commercial and asset finance, just as we’ve seen in residential mortgages.”