Using a Commercial Mortgage Broker – What Are the Benefits?
It’s surprising to know that only about 15% of people who obtain a
commercial
mortgage do so via a
commercial mortgage broker!
That means about 85% of all commercial mortgages are taken out via the
borrower’s own bank! Yet the benefits of going to a broker are considerable.
- The deal you get from the bank is very unlikely to be the most
competitive. The banks are limited to a few products. And of course the
person dealing with you at the bank knows you are a “captive audience” –
that is, you are already their customer. So they have no particular
incentive to find you a competitive deal – in fact they have every incentive
to sell you a deal that is profitable for the bank. On the other hand, the
commercial mortgage broker can scan a huge array of lenders, all competing
against each other for your custom.
- If you try to “do it yourself” and approach individual lenders directly,
it will be enormously time-consuming. They will all have different
application forms and different acceptance criteria – and of course you will
be most unlikely to find all the possible lenders in your category. The
commercial mortgage broker finds out your specific requirements and scans
the entire market to find those that meet your needs – this can be done in
minutes! Then the broker can help you apply to the lenders who are most
likely to accept you.
- A commercial mortgage broker can offer a much more personal
service. He/she will take the time to find out your requirements, your plans
and your situation, and can work out an overall package to meet your needs.
At the bank, you have to fit in with what’s available, not the other way
round!
- The commercial mortgage broker doesn’t get paid until the deal is finalised. That way, they have even more incentive to stick with you throughout the whole process and ensure you are completely happy!
The fact that such a small proportion of borrowers use a commercial mortgage broker is even more advantageous for you. It means you have a large number of lenders competing for the business of a small number of borrowers. This can help you obtain the best possible deal – which can only be good for your business.
Please note that the FSA do not regulate commercial loans or commercial mortgages
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