While the ultimate effect of any Federal Reserve rate hike remains to be seen, it will likely affect the residential mortgage industry in ways that make it more difficult to close loans. If you’re a residential broker looking to diversify, small-balance commercial mortgages could be the answer for you. As long as you’re working with the right lender, these loans are an easy way to earn additional income.
Here a few reasons they may be right for you:
There are many benefits to closing small-balance commercial mortgages.
Non-conforming commercial lenders are much more flexible than banks and other traditional financing sources. These lenders will be willing to listen to your borrowers’ stories and work with you to close the deal. Lenders like APEX handle the underwriting, processing and closing of the loan for you, leaving you with plenty of time to concentrate on your residential business.
You can earn more money.
Brokers who work with banks are subject to lower fee caps because of regulations. If you choose to begin closing small-balance commercial mortgages, you will be able to charge higher commission rates. APEX allows brokers to earn up to 5 points on every deal, including 2 yield spread.
Getting started is simple.
It’s easy to begin closing small-balance commercial mortgages. Simply let your former customers and your referral sources know that you can provide commercial financing. Update your marketing materials to include mention of your new services. Once the leads start coming in, collect the basic information a lender will need – a completed 1003, a tri-merge credit report and a loan submission summary – and submit the deal.
At every opportunity, brokers should consider adding small-balance commercial mortgages to their product offerings. These loans present brokers with the opportunity to close more loans and earn additional income without adding much to their workload. This year, make the decision to add small-balance commercial mortgages to your product offerings.