Lending team explains why speed, certainty and relationships continue to win advisers' business
Basecorp Finance has spent the past couple of years making sure its capital, funding and policy settings could support the next stage of expansion, and the work is now showing up on the balance sheet.
The non-bank lender, which will mark around three decades of lending in 2027, has reached that milestone against a backdrop few lenders would have chosen. "The overall book is now above $1.3b, despite the obviously difficult property market and economy," said Shaun Thorndike, senior non-bank mortgage lender at Basecorp (pictured).
For advisers, the milestone arrives at a telling moment. The OCR is rising again, new non-banks are competing for the same borrowers, and the files coming through are shifting in small but noticeable ways. How Basecorp protects its service as it expands, where its lending is concentrated, and how it reads the rate cycle will shape the deals it can do for advisers' clients in the months ahead.
Bigger book, same phone number
Scale tends to bring process with it, and many advisers will have watched some lenders’ turnaround times stretch as volumes climb.
"Despite growth, we've worked hard to keep the same direct access to decision-makers, flexible policy, and the fast turnaround times within 24 to 48 hours advisers expect from us," Thorndike said.
A fast answer only counts if the money is there to settle the deal, and Basecorp has kept a sizeable buffer on hand.
"Funds availability continues to remain high, with over $175m at present across a mix of cash and facility limit headroom," he said.
Growth can also pull a lender toward the habits of the banks it competes against. Basecorp's investment in its back office has been shaped by a clear sense of what to avoid.
"We've invested in systems and processes to remain competitive, but we've been careful not to create layers of bureaucracy that slow things down," Thorndike said.
The same restraint applies to the way the team deals with advisers day to day.
"We intend to stay small at heart, remain personable, and work hard each day to maintain that consistent service proposition for and with advisers," he said.
Where the deal-flow is coming from
Basecorp's product range covers more ground than advisers who know it for only one type of deal might expect.
"We continue to offer a broad range of first mortgage products, across residential and commercial property, for short and long-term tenors, and for both regulated and non-regulated purposes," Thorndike said.
Ask where the volume sits, though, and the answer has been consistent for some time.
"Residential lending continues to be core for us, with long-term lending to both homeowners and investors making up around 75% of deal-flow. These deals are really solutions for borrowers who don't quite fit the traditional bank box," he said.
The balance of Basecorp's lending is spread across:
- bridging finance
- commercial property
- vacant land
- property trading
- other asset-based lending
For a lending team, a steady pipeline can be as welcome as a growing one.
"While borrower demand varies month to month, the overall mix hasn't changed dramatically, but there has been more regularity in deal-flow across all categories, which has been encouraging and kept our lending team busy," Thorndike said.
Floating rates meet a rising cycle
Interest rates are where the picture gets more complicated for a lender that prices on a floating basis. For a while, the settings worked squarely in Basecorp's favour.
"As a floating rate lender, our pricing has been in a sweet spot for 18-odd months, as the stability of the OCR at stimulatory levels meant Basecorp's non-bank solution was increasingly competitive, particularly as fixed rates drifted upwards on expectations of future rising interest rates," Thorndike said.
That window has since started to close.
"We are now firmly in another rising interest rate environment with recent OCR increases, and while this remains at an early stage, we'd expect this to subdue overall credit demand, including for non-bank options," he said.
Many forecasts suggest three more 25-basis point rate hikes over the next six months to bring the OCR to 3.5%. Adviser submissions offer an early read on how borrowers are adjusting to the upward cycle.
"For now, non-bank credit demand remains healthy, and we're seeing only small changes from advisers in this environment," Thorndike said.
Those changes include:
- greater use of interest-only periods
- a small rise in requests for debt consolidation loans
- more requests to refinance maturing short-term loans
More lenders, a bigger pie
New entrants have joined the New Zealand non-bank market, and Basecorp reads their arrival as a signal about where the sector is heading.
"Competition is healthy, and some of the new competition inevitably reflects expectations that the New Zealand non-bank mortgage market will, and needs to, grow in size. This growth will prove a tailwind for all participants, including Basecorp, as the size of the pie grows. That's exciting," Thorndike said.
When an adviser is choosing between lenders on a particular file, rate and policy only go so far.
"We do think, however, that at the end of the day, advisers value certainty, consistency and relationships. They know they'll get a pragmatic assessment from an experienced team here, a quick answer, and clear communication throughout the process," he said.
Funding depth and history underpin that pitch, and Basecorp is upfront about the limits of its appetite.
"They also know we have the funds availability to provide certainty and underwriting consistency on each and every deal we assess, plus a strong track record built over many years. While we won't say yes to every deal, we can now assist with a very broad range of scenarios in the non-bank space for advisers, at competitive rates," Thorndike said.
Thirty years in sight
Thorndike's own role sits where two pressures meet, the push to write more loans and the need to write good ones.
"One thing I probably bring is a balance between growth and risk. I enjoy finding practical solutions and helping move deals forward to settlement, but I also like making sure we're doing things properly and building a sustainable business that continues to support the adviser network over time," he said.
The approach is built for the long game, and the lender's history gives it one to play.
"That combination helps us support advisers and their customers while protecting Basecorp's long-term strength. We will have been lending for around 30 years in 2027 and have established an exciting platform for the business to move forward from here," Thorndike said.
This article was produced in partnership with Basecorp Finance
