How Many Lenders Do You Have?

by | 27 Jul 2015 | Business, General, Home loans, Investments, Leasing, SMSF

Talking to various people over the past few months has led me to the conclusion that some people over complicate their financial matters. This is unnecessary. How many lenders do you have?

An example of this is the number of brokers or lenders they may use for different types of borrowing.  As borrowers progress throughout their lives they have various stages of borrowing requirements. The following is a typical progression (I’m ignoring student loans):

  1. Car Lease (most people and businesses treat this as a cash flow item rather than an asset)
  2. Home Loan
  3. Business Loan/Equipment Finance/Foreign Exchange Facilities/Cross border transactions
  4. SMSF Loan
  5. Reverse mortgage (in some cases)

The borrower will usually go directly to a bank for a car lease and sometimes a home loan. But 52% of borrowers now use brokers to arrange their mortgages. That’s because most people have figured out the following:

  1. Mortgage brokers don’t charge them – they’re paid by the lender.
  2. They have access to a wider range of lenders and often get a better price.
  3. They act as a quasi- personal treasury department.

What most people don’t realize is that the same is true for all of their lending requirements.

The key is that they require a Finance Broker that can act for them throughout their financial development and one that understands every type of lending that is out there. Few Finance Brokers can do it all, so doing your research is critical. But if you get it right the benefits are as follows:

1. Your business will have a quasi-treasurer that you have appointed (often free of charge). Better still, they will do the running around with all lenders – .

2. They will always get the best product that suits you.

3. They will know your financial history and development and thus will not treat you like a stranger every time you go to speak with them.

4. They will be able to get you a home loan, car lease, equipment lease, business loan…and if you expand internationally, they should be able to arrange the right facilities that you require.

If your broker or lender can’t provide the above, call one that can.