Should you offer commercial loans even if you have a heavy & steady influx of residential loans in your pipeline?
More and more people are using commercial real estate as a means of investment over stocks and bonds. That means for you an even wider client base to originate loans. While some may purchase a duplex to manage, the trend is fast moving towards income-generating properties like apartment complexes and mobile home parks, for example. We are seeing a steady growth of smaller investors: recent college graduates, middle-class couples, single women, even baby boomers are moving money into investment property as a means to generate residual income. Small commercial mortgages are the most common loans done by mortgage brokers. Especially those loans that are bank fall outs because either the property doesn't debt ratio, the credit or LTV doesn't fit into the bank parameters, unique properties, or borrowers who may be self-employed and not be able to prover their income.
Offering commercial services not only helps you capitalize on your current client base, it opens you up to another segment of the property-purchasing market, which in turn can take your brokerage to higher levels. The income can be much greater on these and with several of these wholesale commercial lenders, the approach & process to close these loans is as simple if not simpler than many residential transactions.
