You’re aiming for success as a commercial mortgage broker. You want to earn a good living and help your borrowers reach their financial goals. That’s going to depend in large part on the partnerships you develop with commercial mortgage lenders, and that’s especially true if you’re operating in the small-balance niche of the industry.
You’ll need to know how to choose lenders who fit the needs of your borrowers and how to build and maintain a good working relationship with your contacts at these companies. Here are a few tips on how to build partnerships with commercial mortgage lenders:
What to look for in a commercial mortgage lender
While there are certainly newer lenders in the commercial mortgage industry who could be a great fit for you and your borrowers, it’s good to have at least one lender you can call who’s been in business for a long time. Commercial mortgage lenders with decades of experience have weathered the tough times and come out stronger for it. They’re adaptable, knowledgeable and they really understand commercial borrowers.
A consistent source of funding
If you’re working with borrowers who are looking for stability, it’s important to understand where a lender’s capital is coming from. There are plenty of commercial mortgage lenders offering products funded by investors, but for those borrowers concerned with long-term financial security, you should seek out a lender whose funding comes from a single, stable source. This has added benefits, as these lenders don’t have the burden of answering to investors and, as such, have more freedom in choosing to whom they’ll lend.
It’s important to choose a commercial mortgage lender who will listen to your borrowers’ stories and take the time to understand their financial situations. This is especially true if you’re working with small business owners or commercial property owners who can’t obtain bank loans. Seek out commercial mortgage lenders who evaluate each scenario on a case-by-case basis using common sense underwriting.
When it comes to commercial mortgage lenders, you’ll want to work with those that are both thorough and nimble. All that means is you should partner with lenders who can make quick decisions, but who don’t skimp on reviewing or underwriting just to give you a fast answer. This saves you and your borrower time, as well as headaches once you’re further along in the process.
As a broker, you have immense value in your ability to connect borrowers with the right lenders. Make sure you work with commercial mortgage lenders who understand and appreciate that value. Each commercial mortgage that you work on will require time and effort to close, and you’ll deal with your fair share of complex situations if you work with non-bankable borrowers. Be sure that you work with commercial mortgage lenders who protect your well-earned commission.
What you can do to develop a successful partnership
Learn about their products.
First, it’s important to get to know what a lender offers in terms of financing. Taking the time to learn about a lender’s products and programs is an indication that you’re serious about brokering mortgages and that you want to send commercial mortgage lenders deals that fit their guidelines. This is also beneficial to your borrowers, as you’ll be able to place them with the right lender and help them to achieve their financial goals quickly.
Understand their process.
Talk to lenders about what you and your borrowers can expect throughout the process. What do they require for a submission? What documents will be necessary as the loan progresses? How long do underwriting, processing, and closing typically take? Of course, each commercial mortgage scenario is unique, but it’s important to get a sense of a lender’s process to determine whether or not they’re a good fit for you and your borrowers.
Focus on the relationship.
Building and maintaining good partnerships with commercial mortgage lenders is crucial to closing more deals. Of course, you should send scenarios that you think will fit their guidelines when you can, but you can also call them or email them semi-regularly to ask about any new programs or promos, or just to ask questions. If you can schedule regular face-to-face meetings, that’s even better. Remember that this partnership is a two-way street; make sure your lender is also reaching out to you regularly.
In order to reach your full potential as a broker, it’s important to know how to choose commercial mortgage lenders with whom you want to work and then to develop good working relationships with them. Remember that lenders depend on brokers as well, and don’t hesitate to ask them questions or voice any concerns, since they want to build lasting partnerships too.