As the air cools, the leaves change, and Halloween approaches, there’s plenty to be spooked by, but brokering small-balance commercial mortgages don’t need to be one of them. Working with borrowers who need alternative financing is a great opportunity for brokers to increase business, as well as their income.
Whether you’re a residential broker or a broker who typically handles larger commercial mortgages, you already have many of the skills you need to succeed in the small-balance niche. Here are some tips that’ll make it even easier.
Choose experienced lenders.
If you’re new to the small-balance commercial mortgage niche, selecting lenders with plenty of experience in the industry is your best bet. These are lenders who really understand the ins and outs of small-balance commercial mortgages, and their longevity proves their success and ability to adapt. They’ll be able to teach you about the industry and guide you through the process of submitting and closing these deals.
Learn about their programs.
The best way to ensure a smooth submission, underwriting and closing process is to develop a solid understanding of your lenders’ programs. Take the time to speak with them about the details of each so that you’ll learn to recognize the borrowers who fit their parameters.
Make sure you understand the documentation you need to submit.
Every lender will have different submission requirements, and it’s important to discuss this with them before sending in a deal. Generally, you’ll at least need to submit a completed application form, a recent credit report that includes scores and tradelines, and a summary of the deal.
Work with lenders who handle processing the deals.
Being responsible for processing each of the small-balance commercial mortgages that crosses your desk can be a nightmare, especially when you also need to seek out new leads and sell your services as a broker. That’s why you should always seek out lenders who handle ordering the appraisal, take care of title work and any additional paperwork, and schedule the closing for you.
Closing small-balance commercial mortgages doesn’t need to be scary; you just need to choose the right lenders and develop some knowledge about their programs and the process. Follow the tips about and closing these deals will go from frightening to favorable.