Any successful marriage needs to be worked at. The same is true of the working relationship between bridging loan brokers and lenders.
As volumes continue to rise this year, low rates and reasonably set fees are only part of the recipe when it comes to brokers looking for bridging loans. What else makes a successful relationship?
Honesty between the partners is needed for any marriage to work. In business, this means transparency.
As a lender, it is all very well offering headline grabbing low rates, but brokers will need to let their customers know the total cost of the loan, including various fees and the criteria required to get the loan. What a broker doesn’t want is to have a low rate loan rejected at the last minute and having to accept a higher rate loan due to lack of time.
Brokers also need clarity so that they can compare like for like products. Lenders having a clear website with details of rates, charges and other essential information goes a long way to helping brokers find the right product for their clients.
In turn, lenders must have all the information for the loan application as quickly as possible. Most brokers will have a good relationship with their clients and it can be expected that much of the pre-application paper work, such as identity checks, should have been done, helping to save time.
Collaboration and dialogue are key to building a strong relationship. For brokers, they are looking for speed in arranging the loan, certainty their customer will get the loan and the price. Brokers also appreciate being kept informed of the progress of the loan application. Lenders are looking for a swift response to questions to help speed up the decision-making process.
It might also be tempting to poach broker clients but this is not recommended. The damage done to the lender’s reputation will make getting future business more difficult in the long run.
Building up trust and respect is key to a good working relationship. Although much can be achieved with communications technology this is no replacement for regular face-to-face meetings to enhance mutual understanding of each other’s needs. Make the time to meet regularly, understand how you work and discuss the best way to work together and the processes needed to make it smooth. This will avoid any miscommunication in the future.
Ultimately, by brokers and lenders working together the borrower receives the funding they require while lender investors get a decent return – benefitting the sector as a whole.