Private lenders do not have to play it small. Lender technology has levelled the playing field, with smaller lenders gaining access to the tools that the big banks use.
While smaller, private lenders have traditionally struggled to compete with large financial institutions due to less resources, less information, and less reach, technology is changing all that.
In fact, a non-bank private lender, Romspen, recently saw its revenue nearly double between 2017 and 2018 when it went from $161 million to $229 million respectively.
We have also seen in recent Teranet Market Insight Reports that the mortgage market share is shifting slightly away from the big-5 banks and towards alternative lenders.
With the mortgage stress test in place on federally-regulated lenders, the time is ripe for private lenders to boost their revenue. And that all starts with the tools and technology you choose.
Automated Valuation Models (AVMs)
Smaller lenders can access the same property value estimates as the big banks by using an AVM to estimate value, identify legal homeowners, view registered mortgages, and more.
This stops bad deals from making it past the application stage so you can close more deals.
You can also use the AVM as a sales tool by offering to find the estimated property value for interested homeowners. If the result is favourable, you may have a new client.
For smaller lenders who offer alternative products, such as home equity lines of credit, quickly identifying the available equity in a home is critical.
With an equity estimate you can access this data on the Purview platform, making it easy to identify opportunities for clients.
You might even be able to find upsell opportunities, or options your clients were not even aware of. For instance, if a client comes to you for help with debt consolidation, you might run an equity estimate and discover that they have enough equity to qualify for a second mortgage or a HELOC.
Lenders can access up to 18 customizable real estate fraud checks to uncover potential flags. This helps mitigate risk and ensures that only validated deals make it into the underwriting process.
If you have a property you are interested in, or need to track title registration activity, PIN Monitoring makes it easy to do so. Receive notifications for registration activities on properties in your securitized portfolio.
Review mortgage registrations, discharges, tax liens, and more. This can enable you to be more competitive, regardless of the size of your lending operation.
While it used to be more difficult for small lenders to compete with the big banks, that gap is shrinking thanks to lending technology. In fact, today’s private lenders may even have an advantage due to federal mortgage regulations and interest rate changes.
It all starts with the tools you use. Expand your lending portfolio today to become more competitive.
Learn about Purview by calling 1-855-787-8439 or visiting www.purview.ca.
Our portfolio of solutions for the financial industry is growing. Stay tuned for more information.