An in-house process helps avoid the costly and time-consuming step of dealing with lawyers for smaller loans, executive says
This article was produced in partnership with LendHub
Fergal McAlinden of Canadian Mortgage Professional spoke with LendHub’s Shay Shnet on how the company is servicing an important niche in the mortgage market.
A common-sense approach and speedy servicing times are more important than ever in the current mortgage market – and those have been two of LendHub’s biggest strengths since the company opened its doors three years ago, according to founder and CEO Shay Shnet (pictured).
Its product is a unique one that services a specific niche in the market, Shnet told Canadian Mortgage Professional, with LendHub focusing on micro mortgages up to $100,000. That’s based on the idea, he explained, that a smaller mortgage shouldn’t take the same time to fund as a traditional larger deal.
“Our offering is that we’re able to fund using no legals and no appraisals, which is a huge timesaver for both clients and brokers,” Shnet said. “The idea behind LendHub was that it was created out of a need for speed and the fact that a $40,000 or $50,000 mortgage is not the same as a $400,000 or $500,000 mortgage.”
In too many cases, according to Shnet, borrowers and brokers are faced with a stressful situation when attempting to close a rush file, even when the borrowing sum is nowhere near as high as a normal mortgage. That’s where LendHub comes in, controlling the process from beginning to end – saving brokers the often-lengthy wait to get documents signed off by a lawyer.
“The brokers and clients shouldn’t have to jump through the same hoops in order to get funded,” he said. “Too often, brokers have to ask lawyers to put other files aside and deal with theirs. Instead, we do everything in-house, so they don’t have to rely on anyone else to do it. Every single day is kind of a rush file for us because that’s our niche – that’s our specialty.”
Saving time and money essential considerations in current market
That offers a huge benefit for brokers, Shnet added, because while they’ll be all too familiar with the often-sizeable fees that usually accompany legal work on private mortgages – frequently thousands of dollars – LendHub saves that expense by registering everything themselves, both on the legal and appraisal side.
Combined with efficient and rapid service that often sees files turned around within 48 to 72 hours, that’s a winning formula for both brokers and their clients, according to Shnet, offering the possibility of saving both time and money.
That “common-sense” approach is an important one to LendHub. “So long as the broker clearly communicates an exit strategy, we’re happy to proceed,” Shnet said.
Unlike some other private lenders, the company services the entire province of Ontario and is happy to consider deals in rural areas and more remote properties.
Company making a name for itself in Ontario
To date, 2023 has been an eventful year for LendHub, according to Shnet, with the company beginning to hit its stride and develop strong brand recognition among the broker community despite being relatively fresh in the industry.
“There are more and more brokerages finding out about what we do, and they’ve been using us as a tool in order to get more referral business from realtors and so on,” he said.
The private mortgage market only looks set to grow further in 2024, with an increasing number of Canadian borrowers turning their attention to the sector as qualification with traditional lenders becomes more difficult – and Shnet said LendHub is poised to achieve even bigger success in the coming years because of its unique value proposition in the space.
“We’re just expanding our market reach, getting our name out there, and making sure that brokers really know about us,” he said. “We feel that we’re just scratching the surface at the moment – and we’re just getting started.”
Why brokers use LendHub: www.lend-hub.ca/broker
LendHub is a private mortgage lender based in Ontario, Canada.