Why a commercial mortgage broker can make all the difference to you?
It’s really important to remember, the commercial mortgage broker will have relationships with loads of commercial lenders and will know the requirements and lending criteria of them all.
Like anything, because the commercial mortgage broker is working in commercial sector, they will have their finger on the pulse! Which of course can really help clients save time, money and energy by focusing on the right lenders.
Oh and lets not forget, the commercial mortgage broker will be doing all the chasing and hard graft with the lender, besides just finding the deal.
Pick your commercial mortgage broker carefully!
One of the big advantages of working with a commercial mortgage broker who also works in the regular mortgage world (residential and buy to let, not that this isn’t any less complicated) is that they will be able to look at you and the deal holistically, not just in isolation!
For example you might need some form of commercial mortgage now (maybe development finance), but then you also need to plan for what happens next!
This might include figuring out how you will repay the development loan with a residential, buy to let, holiday let, HMO or some other form of mortgage, assuming you are going to keep it!
We have seen clients come to us who are needing to plan their exit out of a development loan and remortgage onto a residential mortgage. The problem for these particular clients, was they got the original development finance with a commercial broker who had no knowledge or experience of whether this would even be possible. Of course, the sad reality was, he probably didn’t care, and it was never going to be his problem!
Just to let you know the story ended up okay, as we were able to help in the end. But it wasn’t easy and it would have been so much smoother, cheaper and less stressful for the client if we had managed the whole process.
When do people usually use a commercial mortgage broker?
As commercial mortgage brokers, clients usually find us after they have been turned down by their bank or a clients professional adviser (usually an accountant but sometimes a solicitor) have recommended us to them.
Unless a client has already dealt with a commercial mortgage broker before, it is fair to say we are probably not someone’s first port of call!
There isn’t any reason for this other than people are not always aware of us, what we do and how we can help. When it comes to a commercial mortgage a client will usually think of no one else apart from ‘their’ bank or ‘a’ bank.
Don’t get me wrong it would be great if this wasn’t the case, and clients contacted us first.
Of course this might change in the future, in much the same way as the massive and sophisticated residential mortgage market has shifted. In this market approximately 75% of all mortgages are now done through independent mortgage brokers like ourselves.
So clearly people are seeing the benefits of dealing with someone independent brings, and I expect over time the antiquated commercial mortgage world will also shift. But only once clients realise it’s always better and easier to use someone independent who is working for their best interests, not the banks! Don’t forget, as nice as the banks are (and there are some great people who work in them), they are only ever going to be interested in themselves and squeezing the most out of you.
Don’t feel sorry for us though, we are really busy and are helping loads of clients throughout the UK. I think a sign that we may be doing something right is the fact we get referrals from high street commercial bank managers unable to help their clients and accountants whose clients need help. They are kindly telling their clients about us when they come across a barrier.
The reality of getting a commercial mortgage!
However, lets not be unrealistic, getting a commercial mortgage through the usual high street lenders is still proving tricky for lots of individuals and businesses.
The good news is the market is opening up with new lenders emerging and filling the hole left by the usual suspects. Click To Tweet This is where commercial mortgage brokers can really help.
For commercial mortgage brokers like us, this is great news as we have more tools and solutions for our clients who have usually been turned down by a high street lender.
Of course it wasn’t that long ago when we were all struggling to find solutions for our clients and this was hugely frustrating for both our clients and us. However times are increasingly changing and we are finding some exciting opportunities for our clients. As the old saying goes, “its not what you know”!
Why should people use commercial mortgage brokers at all?
The marketplace for commercial finance is challenging. Borrowing from High Street Banks is not easy due to tough lending criteria. As a result our role as independent commercial mortgage specialists is becoming more valuable than ever. Click To Tweet
We have the ability to access a wide range of lenders, from traditional high street banks, to niche and specialist lenders. Fundamentally this means that there are more chances for an application for finance to be approved.
Every business and every commercial property is different, no two deals are the same. A broker with a good track record, experience, specialist knowledge and access to lenders you won’t have heard of is vital.
Equally important, however is honesty and transparency. This is one of my biggest bug bears when it comes to certain brokers and firms. It frustrates the hell out of me, as it affects the whole industry.
As far as we are concerned, if we can’t help, we will tell you, but rest assured we will fight every inch to do so. At the core of our business are our clients and everyone at Barr Financial are passionate about providing an amazing service. We are always willing to help and go the extra mile.
Commercial mortgage broker insights!
Property development loans are seeing some innovation from new lenders into the market.
This is great particularly as some of the major banks are not always keen on this sector, which has resulted in these new disruptor’s seeing an opportunity in this market. Of course the end result has enabled property developers to secure finance and move forward with their businesses and opportunities.
Interestingly development finance is also seeing more and more private lenders coming into the market. Some of these are financiers who offer a typical lending solution but who maybe willing to take more risk. Others are looking to help developers with 100% funding on a joint venture (JV's) basis. Click To Tweet This means the developer does not have to put any money into the deal! Of course like anything there is always criteria the financier or JV partner is looking for, which may include experience or planning permission in place.
As commercial mortgage brokers we know who the players are! Working with commercial brokers like us will really help you move forward with your plans and enable you to focus on the business as opposed to fighting with banks and wasting a lot of time, hassle and frustration.
Of course there is no one size fits all, so your particular situation may look very different or need an alternative or indeed mainstream solution. For example a property developer may need a different solution than someone buying a business or someone buying the premises they work in. All of these will need a different mortgage solution.
Where High Street lenders struggle to get deals through their credit officials in head office, we have access to lenders who will lend in the current market. Not only this but we have access to lenders that can turn deals around incredibly quickly. This is particularly helpful for those business people who need commercial finance quickly.
If you have some security, assets or available cash to input, then the potential is much greater. Some of these lenders will only be interested in your assets as opposed to scrutinising every small detail of your business. This means faster decisions, less waiting and puts business owners in a position to act quickly to secure deals.
The crucial point before speaking to any lender is to have a clear strategy and plan. As experienced commercial brokers we will know how best to position your case and whether or not its likely to be successful.