Specialist commercial lender Private Mortgages Australia (PMA) has celebrated three years in business by doubling its volume of newly settled loans over the past financial year.
PMA managing director Tony Barbone said the firm’s success was a result of an increase in small-to-medium businesses needing alternatives to the banks.
“We’ve had so many brokers and referrers come to us with clients who have been turned down by the banks. While serviceability is the greatest concern for banks, we are primarily focussed on securing the loan using property equity which allows us to be a lot more flexible.”
While Barbone was reluctant to mention the specific size of PMA’s loan book, it had increased by 151% in its second year and then a further 115% in its third, most recent year, he told Australian Broker. PMA was first established in 2014.
“We’re so impressed that we’ve been able to maintain this growth and double our loan volume year on year. We definitely have our brokers and referrers to thank for this.”
Barbone said he had also noticed an increase in the number of brokers diversifying into the commercial lending sector.
“It’s great that brokers are starting to see the benefits of working with small-to-medium businesses as there are so many who struggle to access funding when it is readily available from non-bank lenders.”
PMA currently has over 3,000 brokers in its database with an increasing number referring commercial loans to the lender, Barbone said.
“We’ve found that educating brokers about commercial loans via our regular webinars has helped us continually grow the number of referrers that come us.”
The directors of PMA expect a further 50% increase in the number of settled loans in the coming financial year.
The firm has recently focused on reducing channel conflict by bringing in ‘subsequent referral fees’ to referrer clients who approach PMA directly for additional loans. The firm has also amended its Referrer Rewards Program to make obtaining rewards simpler when referrers introduce clients to the lender.
“We have now become ‘channel agnostic’ whereby a borrower pays the same approval fee if they come direct to us or through a broker. We also allow our brokers to add a service fee or mandate,” Barbone said.
“We have also added a new policy whereby if a broker sends us a client, that client takes out a loan and then that same client comes back to us directly for another loan we will still pay the broker a referral fee.”
It’s important to respect the fact that these individuals are all broker clients, he added, especially since more than 90% of PMA’s loans come from the third party channel.