What Makes a Good Private Lender?

10/07/2024

And the most important criteria for most brokers when assessing private lenders

In the world of SME financing, brokers play an essential role in connecting clients with the right lenders. According to the latest Agile Marketing Intelligence Lending Report, the top priority for brokers when evaluating private lenders is the quality of their credit assessment staff.

This factor surpasses even the importance of competitive pricing and favourable terms. Here’s why the expertise and approach of credit assessment teams are critical and how brokers can identify the best private lenders for their SME clients.

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Understanding the value of a lender’s credit assessment staff

Access to the Loan

Timing is everything when it comes to SME funding. Even the best pricing and terms become irrelevant if a client cannot secure financing in a timely manner.

Delays in the loan process can result in missed opportunities, operational disruptions, or even financial distress for SME owners. Therefore, brokers need to ensure that the lenders they work with have efficient processes and responsive credit assessment teams that can expedite loan approvals without compromising due diligence.

Ease of Collaboration

When judging the quality of the credit assessment staff, a significant factor brokers consider is the ease of working with the credit assessment staff. While technology and AI have revolutionised many aspects of the lending process, there's a limit to how much automation can replace human judgment, particularly in the nuanced area of loan approvals.

Automated systems often rely on standardised requirements, which, while speeding up the process, can inadvertently disqualify otherwise eligible borrowers.

Tailored Funding Solutions

Brokers must seek out lenders with credit assessment staff who can provide personalised service. These professionals should be adept at understanding the unique needs of each SME and capable of crafting tailored funding solutions.

This personalised approach not only increases the likelihood of loan approval but also ensures that the financing aligns with the client’s specific circumstances and growth plans.

What Brokers Should Look For

To identify a good private lender, brokers should:

Evaluate Responsiveness: Assess how quickly and effectively the lender can process loan applications. Look for lenders with a track record of timely approvals and efficient communication. At PMA, we have a guaranteed four-hour response time from when we receive a loan application.
Check Flexibility: Ensure the lender can offer customised loan solutions rather than a one-size-fits-all approach. Flexible lending criteria can be a significant advantage for SMEs with unique financial situations.
Assess Expertise: Consider the experience and knowledge of the credit assessment staff. Lenders with seasoned professionals are more likely to navigate complex applications and provide valuable insights.
Review Client Feedback: Gather feedback from other brokers and clients who have worked with the lender. Positive testimonials about the credit assessment staff can be a strong indicator of quality service. You can view PMA’s testimonials here.

About Private Mortgages Australia (PMA)

PMA offers short-term and flexible finance solutions to SMEs and property developers. We are known for our transparent lending process and our quick response time.

On average, PMA responds within 4 business hours after the initial query of the client. The entire application, approval and loan settlement process can occur within just 5 business days upon receipt of all outstanding information.

Among the funding solutions provided by PMA are the following:

PMA also has a referral program for brokers and financial advisors who get paid a commission for successful referrals. These referrer fees are paid within 24 hours of settlement with no clawbacks or any hidden fees.

Moreover, PMA’s referral system is channel agnostic. This means that if a referred borrower comes directly to PMA for a second loan, the original referrer will still get paid referrer fees for that next transaction.

If you’re a broker or a financial advisor and would like to know more about PMA’s referrer program, be sure to visit our referrers’ page.

If you have a business lending scenario you would like to discuss, feel free to contact us or you can complete our Quick App form here (< 10 mins).