Q&A with Shanta Lobo – Senior Relationship Manager

Shanta is Senior Relationship Manager LendingShanta Lobo recently joined Private Mortgages Australia in the role of Senior Relationship Manager. We thought we’d take the opportunity to find out from Shanta herself what’s involved in her role and how she can help clients with short-term business finance.

1. What made you decide to join PMA?

Having been a career banker, with a history of 20 years in commercial business banking, I wanted to try something different that also complemented my experience and expertise. The role with PMA was able to offer me just that. The Senior Relationship Manager role is challenging because it’s a new environment but maintains the basic functions of a commercial lender.

2. What are you looking forward to most in this role?

I’m looking forward to learning more about the private mortgage space and working out ways to help small-to-medium businesses with their borrowing needs. I’m also excited about establishing relationships with brokers and helping to educate them about the various ways we can help their clients.

3. What do you think the key benefits of working with a private lender are?

This is lending at a grass roots level. We’re helping clients based on their individual needs and providing realistic lending solutions. The best thing is that we’re able to think outside the square and structure deals very differently to banks in order to provide more practical options for businesses.

4. What do you bring specifically to the PMA team?

With my background in business banking I bring a thorough understanding of business requirements. I have extensive knowledge relating to interpreting financials, financial projections and security structure. I also have a great network of brokers and referrers that I’m looking forward to working with in the future.

5. What makes PMA different to other lenders?

PMA recently made the decision to increase our maximum LVR to 80%. Most private lenders will generally only lend 65% to 70% LVR, and a lot of the time this is based on a forced-sale valuation rather than the true value of the security property. We always take the true value of the security property without any tricks in order to give our borrowers a better solution.

We’ve also introduced a ‘subsequent referral fee’ in order to eliminate channel conflict. This means we still pay a referrer should a borrower come back to PMA directly after taking a previous loan with us via a referrer.

At PMA we’re all about having a transparent lending process that offers greater flexibility and quicker turnarounds than traditional lenders so that a business can get the best solution.

6. What do you think is most important when maintaining good relationships with brokers/referrers?

Listening to client or referrer and understanding their requirements is absolutely paramount. Taking the time to ask questions and fully understand their individual circumstances makes the rest of the process so much simpler. It’s also important to provide prompt responses and to make quick lending decisions. Overall, by providing solutions that work for the client ensures a smooth process that everyone is happy with.

7. PMA doubled its new loan volume last financial year, why do you think this is?

I think it comes down to great service and delivering great results. We receive a lot of return business which is pretty rare in private lending but it’s something we’re extremely proud of. We’ve found that the great relationship we have with brokers means that they spread the word to other brokers in their network.

8. What are you aiming to achieve at PMA?

I’m hoping to get in touch with as many brokers as possible to find out more about their clients’ needs and educate them about what PMA is able to provide. I also think it’s important to establish a good relationship with the client directly and make them comfortable whilst maintaining a good relationship with the broker.

I’m aiming to always provide prompt and efficient lending solutions and keep on top of the entire lending process through to settlement.

 

To speak to Shanta about your business finance needs get in touch with her on 03 8488 9926 or 

[email protected]

 

PMA’s 2017 In Review

What a year it’s been for Private Mortgages Australia! We’ve had some standout moments in 2017 including:Private Mortgages Australia celebrates some stellar moments in 2017

  • Doubling our new loan volume in the 12 months leading up to our third birthday in July
  • Raising our maximum LVR to 80%
  • Taking a stand to put an end to channel conflict.

We’ve also continued to grow our team with new hires, hosted well-attended webinars and increased our Referrer Remuneration and Referrer Rewards. Here’s a bit more information about the highlights of 2017:

Doubling our Loan Book

In 2017 we saw our new loans grow by 115%, doubling our volume.  We’re so impressed that we’ve been able to maintain this growth (in our second year we increased our loan volume by 151%) – we definitely have our database of 3,000 brokers and referrers to thank for this.

We’ve put this success down the ever-increasing number of small-to-medium businesses needing access to commercial funding who can’t get it from the banks. It’s also been great to see so many brokers diversifying into the commercial space to work with these businesses.

We’re expecting a further 50% increase in the number of settled loans in the current financial year and are already well on track to achieve this.

LVR Increase

In the second half of this year we decided to raise our maximum LVR to 80%. The decision comes after we partnered with Property Predictions Pty Ltd, the creator of patented methodologies which measure demand trends and predict expected changes in prices across the Australian property market.

Most private lenders will generally only lend 65% to 70% LVR, and a lot of the time this is based on a forced-sale valuation rather than the true value of the security property. We always take the true value of the security property without any tricks in order to give our borrowers a better solution. The Traffic Light Reports from Property Predictions employ predictive and patented algorithms developed by leading property market analyst, John Lindeman, to provide highly accurate short term rent and price change predictions for houses and units in any suburb in Australia.

Combatting Channel Conflict

A recent survey conducted by The Adviser found that 78 per cent of brokers had lost a client as a result of channel conflict. It appears to be a growing concern with 88 per cent more worried about channel conflict than they were 12 months ago.

We receive over 90 per cent of our business from broker referrals and we want to keep it that way. That’s why we decided to make changes to our referral fee structure to alleviate any concerns from our broker partners about channel conflict.

We’ve now introduced a ‘subsequent referral fee’ which is paid to the referrer should a borrower come back to PMA directly after taking a previous loan with us via a referrer. We get a lot of repeat clients (which is uncommon in private lending) so we believe we’ve got to be doing something right. We want to reward referrers for providing us with a good lead and will continue to do so no matter how many times that client comes back to us directly. It’s basically free money for our referrers but we believe they deserve it. All referrer fees are paid within 24 hours of settlement with no clawbacks.

Finally, we’d like to take this opportunity to wish all of our supporters a very merry Christmas! It’s an extremely busy time for us and we’ll be working right up until Christmas Day in order to help any borrowers who need finance before the end of the year. If you have any commercial finance needs please get in touch.

MERRY CHRISTMAS!

PMA makes new hire on back of stellar year

Royce Goh Senior Relationship Manager at Private Mortgages AustraliaPRESS RELEASE: 

Private Mortgages Australia (PMA), the specialised lender offering cost-effective loans to small-to-medium businesses, has hired experienced credit professional Royce Goh in the role of Senior Relationship Manager.

With 15 years of lending experience in Australia and overseas, Goh joins PMA from First Financial Services where he held the position of Mortgage and Business Loan Consultant. Prior to this he was the Asian Business Development Manager & Relationship Manager with NAB Business Banking.

“Private Mortgages Australia is experiencing incredible growth in the short-term lending space for commercial clients, so I’m really pleased to be joining them at such an exciting time,” said Goh. “The team are a great bunch of people who work with great brokers and borrowers and I’m looking forward to growing the business even further.”

In 2016 PMA saw a 210% increase in the number of loans settled and saw an 38% increase in the number of referrals coming in through referrer relationships. In order to accommodate this growth, PMA expanded the team with new hires, including Goh, over the last 12 months.

“2016 was a very exciting time for us at Private Mortgages Australia and with Royce joining us I can see the business getting bigger and better,” said Managing Director, Tony Barbone. “There’s been a real shift in the market with small-to-medium businesses realising that funding options are available if they get turned down by the banks. We’ve also seen many brokers diversifying into the commercial space which has seen more borrowers being introduced through referrer partners.”

“We’re expecting 2017 to be an even stronger year for us as many foreign investors look for alternative finance solutions due to the banks placing stronger restrictions on overseas borrowers,” continued Barbone. “Royce’s experience in Australia and abroad as well as his multi-lingual skills will make him the ideal person to help foreign borrowers find a loan that works for them.”

 

– ENDS –

About Private Mortgages Australia

Founded in 2014, Private Mortgages Australia (PMA) offers short-term, flexible loans to commercial clients that can’t get finance from the banks. Its transparent lending process offers quicker turnarounds than traditional lenders so that a business can get the best solution for achieving its goals. PMA offers first mortgage finance, second mortgage finance and caveat loans and can offer tailored solutions for borrowers who require urgent funding, have an ATO debt, are refinancing, are developers completing a project or are credit impaired.

Borrower Beware: Lender Tactics

Learn how to avoid unscrupulous lender tacticsA private mortgage is a great option if a borrower is having issues borrowing from a bank or if they are looking to have their mortgage application approved quickly. A private lender provides the loan with less red tape and processes the application in a timely manner, so you can access the funding you need sooner. Unfortunately though, there are some bad lending practices out there which can bring a borrower unstuck.  However, as with all industries, it’s a case of just a few bad operators making a bad name for the industry. If you know what to look out for and the right questions to ask your lender then a private mortgage can be a great option and deliver the best results for the borrower.

Here are five things to keep an eye out for when looking at a private mortgage:

1. Upfront Fees

The practice of lenders charging huge upfront fees is one of the biggest problems with the private mortgage industry. Some lenders can charge tens of thousands of dollars in upfront fees without the borrower even knowing whether or not they will be accepted for a loan. To ensure a borrower isn’t out of pocket and without a loan make sure you look carefully at the upfront fees charged by a lender and go for a company that charges minimal fees upfront. $550 – $1,100 is typical depending upon the size and complexity of the loan. You want a lender who makes their money by actually lending money not just charging upfront fees and rejecting the loan.

2. 24-Hour Loans

One of the major benefits of a private mortgage is the speed.  A private mortgage can be settled within a fraction of the time in which a traditional lender would require. This is because a private lender tends to focus on the security – the property to be used as collateral for the loan – rather than on ‘red tape’ processes and the applicant’s credit history, which a traditional lender might be more focused on.

A quick turnaround on a loan application is something that most private lenders will be able to offer, however, many lenders are now taking this one step further by saying they can have the loan settled within 24 hours. While in some cases this may be possible, there is still a phenomenal amount of work that needs to go into any lending decision and it would be very unlikely that every loan could be settled within this time frame. If you a working with a lender that claims 24-hour turnarounds then it may be wise to ask them exactly how many loans they have completed within a day. You may find it’s not something that happens very often. The lender knows that once the borrower is committed to them it will take too long to start again with another lender so they stay with them even if they take another week to do the loan.

3. Expensive ‘Forced Sale’ Valuation

Many lenders don’t offer loans based on market value but rather will do a ‘forced sale’ valuation which typically comes in well under market value. This means that when the Loan to Value Ratio doesn’t stack up they will come back to the borrower and make them pay the upfront fees and charges. Make sure you check with the lender what type of valuations they do.

4. Cancellation Fees

Lenders can also include a clause in their offer that if a borrower doesn’t proceed with the loan then they can be charged a cancellation fee. Usually this can be around two percent of the loan value. In some scenarios the lender can put a caveat over the property and hold the borrower to ransom until the fees are paid. To ensure this doesn’t happen, make sure you read all the fine print and ask about cancellation fees up front.

5. ‘Too Good to be True’ Rates

A sneaky trap that some lenders use is advertising a low interest rate, in order to attract a borrower, however when it comes to the actual loan offer the rate is much higher than this. The way they trap the borrower is by including a ‘from’ rate in the Indicative Letter of Offer. When the final loan documentation is received the rate is completely different to what they signed up for. If they withdraw at that point and don’t sign the loan documents the lender then caveats the properties in the offer and demands their cancellation fee. Obviously, this can cause a lot of disappointment and frustration so make sure to ask the lender up front for an estimate of the rate which will be applied to the loan. A good lender should be able to give you a pretty accurate interest rate based on the upfront information you provide.

 

While most private lenders have a transparent lending process and are genuinely trying to find the best loan option for the borrower, there are other lenders out there that can make the process a lot trickier.  Hopefully these five pointers have given you an idea of what to look out for and will help you to navigate your way through to a successful private mortgage deal.

 

By Tim Hart

Director, Private Mortgages Australia

New Website Launches

Private Mortgages Australia has launched a new websitePrivate Mortgages Australia is very excited to announce the launch of our new website. We’re hoping the new site will be the place to go for all the information you could ever need relating to private lending. On the site we will regularly share industry news, give our opinion on relevant topics and provide updates on our products and the work we’re doing for our clients.

We’d be very happy to receive suggestions from our brokers and referrers about the kind of information you’d like to see on the site. We also hope to feature some of your articles and case studies so feel free to send over anything you think would be of interest.

Keep an eye on the website for details on our next webinar and we also hope to be launching a new ‘Referrer Rewards’ program in the not too distant future.

You can also follow us on our various social media pages including: