Speaking at the London Mortgage Business Expo, Philip George, managing director of Commercial First, said commercial lenders were starting to realise the potential of using brokers as their main form of distribution, with up to 20 per cent of cases being originated by brokers. He added the increasing numbers of lenders entering the market was stimulating interest amongst brokers and research had shown 84 per cent had identified commercial mortgages as the biggest growth opportunity.
George commented: “It is no accident the rise of commercial lenders has been associated with intermediary distribution. Lenders are recognising intermediaries do a valuable job and are paying them fees, when ten years ago there were none. In the future, I can see more partnerships between networks and specialists and a replica almost of the residential market, with the greater involvement of technology.”
However, he added brokers needed to be sure of their business strategy and decide whether they wanted to be a mainstream player or an introducer, as the market was growing very quickly.
The comments were backed by Kris Gardner, manager of business development at Interbay Funding Ltd, who said: “It is absolutely right that intermediaries are most likely to introduce borrowers to commercial lenders. Brokers bridge the gap between customers and lenders, as borrowers really don’t know where to turn for advice outside the high street lenders and the first place is a specialist. We have found 30 to 40 per cent of mortgage brokers have self-cert residential or buy-to-let borrowers, who are prime candidates for commercial borrowing. After the growth of non-conforming and self-cert, the natural evolution of the market is to commercial, as it’s the underserved market right now.”
