Stretching beyond home loans into other areas of finance can help mortgage brokers future-proof their businesses
The ability to diversify is an important skill that every broker should have if they want to remain competitive, retain customers and ultimately grow their business.
As the market for home loan customers becomes more crowded, some brokers are looking to offer other types of lending and services to avoid relying solely on residential mortgages for their income.
But diversification is not just about commercial property lending; it also covers SME finance, such as for asset and equipment purchases, lines of credit and cash flow funding; SMSF lending, personal loans and more. Some brokerages diversify by offering non-lending services.
Roberto Sanz, general manager sales and partnerships at small business lender Prospa, and Amol Khuntale, an award-winning broker and director of ASK Financials, gave MPA their insights on different ways to diversify and how it can benefit broker businesses.
Adding value to broker offering
Sanz says Prospa sees diversification as a means of increasing the value proposition brokers offer clients when they address a range of funding needs.
“Right now, small business lending presents a huge opportunity because of the unique support that SMEs require,” Sanz says. “Small businesses are often time-poor, and cash flow remains as the top funding need. Brokers who can solve for these needs will strengthen their proposition in the SME market.”
By understanding the unique pressures and opportunities of SMEs, brokers can offer tailored solutions that meet a wide range of needs, from cash flow and growth capital to strategic financial advice, says Sanz.
“It’s about becoming that go-to partner clients can rely on as their needs change. Take, for example, a broker in Sydney who worked with a client for over 10 years, helping them grow their business from $200,000 to
$6 million annually. You can imagine how their needs evolved over time, and how valuable that relationship became for both the client and the broker.”
A YouGov study from October 2024 shows that 30% of SMEs are planning to seek external funding over the next 12 months. Sanz says now is the time for brokers to work with their SME clients on what’s next in 2025. Khuntale, who was named the 2024 FBAA New Finance Broker of the Year, says he sees diversification as a way of creating value across interconnected fields to support clients holistically. His Melbourne brokerage, ASK Financials, has expanded into business and commercial loans to meet its clients’ broader financial needs.
“Transitioning into business finance involved focused upskilling, including specialised training in loan structures, cash flow analysis and attending commercial training sessions conducted by our aggregator,” says Khuntale.
“While challenging at first, this shift has been rewarding, allowing us to provide comprehensive solutions and strengthen client relationships.”
ASK Financials also offers SMSF lending, providing clients with tailored solutions for their self-managed super funds.
Looking ahead, asset finance is our next area of focus,” Khuntale says. “Expanding into asset finance will allow us to further meet our clients’ diverse financial needs, strengthening our role as their all-in-one financial partner.”
For Khuntale, diversification extends beyond lending. He has recently set up three separate businesses to complement ASK Finance: investor platform Investar.io to provide a wealth of data to investor clients; Skill Pal, which provides back-office support to brokers; and Digistratics, a marketing service for brokers.
“Together, they form a comprehensive ecosystem, enabling us to empower brokers, buyers and investors on every step of their journey. It’s strengthened client trust, increased referrals and positioned us as a comprehensive resource in the industry.”
Benefits of diversification
Diversifying is about future-proofing your business, says Sanz. “With open banking and AI simplifying home loan comparisons and processing, the role of residential brokers will evolve. Moving forward, value-driven relationships will outperform purely transactional ones, so it’s in mortgage brokers’ inter- ests to offer more than just one solution.”
Sanz says by expanding into areas such as SME and commercial finance, brokers can build stickier relationships that support clients across every stage of their journey, creating lifetime value.
“Diversifying revenue streams also adds stability, helping brokers weather housing market fluctuations. At Prospa, we’ve seen an 11% increase in mortgage brokers referring business over the past year, which shows how trusted relationships can unlock real opportunities.”
Helping brokers branch out
To successfully diversify their businesses, brokers can’t do it alone – they need training and support. Sanz says Prospa provides a full suite of tools and resources to help brokers confidently branch out into new business lending areas. This includes ongoing access to free educational resources, such as webinars and marketing materials, which brokers can use to manage client conversations and grow their businesses.
New technology is making it even easier for brokers to diversify, says Sanz. “Prospa Intelligent Quoting, our newest quoting innovation, allows more brokers to confidently assess their clients’ creditworthiness in real time, improving their customer experience.”
Prospa BDMs are there to help brokers every step of the way. Sanz says a broker recently expanded into SME lending, relying on Prospa’s support to help a self-employed client open a new cafe in Perth after they had been turned away by a major bank.
“With Prospa, the broker secured $500k in funding. The client was thrilled with the fast turnaround and level of service and soon returned to the same broker for help with refinancing their residential loans.
“Prospa’s BDM supported the broker throughout the entire process.”
Khuntale says new brokers wanting to diversify can start by understanding their clients’ needs and identifying complementary services that add real value.
Tech tools to support brokers
Sanz says the new Prospa IQ tool is designed to give broker partners confidence in its accuracy and outcomes. It enables partners to generate on-the-spot quotes, backed by
Prospa’s credit decision engine. “The tool automatically analyses bank statements, credit profile and serviceability in real time with no credit checks,” Sanz says. “It determines the client’s borrowing capacity, price and term.
“On top of that, partners can now choose the service approach that best fits their business model,” he adds. “They can manage their own clients’ applications end to end through our Partner Led service, or they can spot and refer the opportunity for us to run the application.”
Prospa has also sharpened its rates for good-quality businesses, ensuring brokers can access competitive rates for their clients. “We’ve also enhanced our loan products, including five-year terms on business loans, as well as increasing our line of credit limit up to $500,000. Together, these changes will help reduce repayments while serving a larger and more diverse group of businesses,” says Sanz.
