Commercial Lending can give brokers more ways to support business owners, whether they’re looking to purchase premises, release equity or fund the next stage of business growth.
In a recent MA Money webinar, Katie McNamara, Senior BDM, was joined by Corrie Woodcock, Senior Commercial Credit Manager, to explore how Commercial Lending works in practice and what brokers can do to prepare stronger applications.
Start with the security, purpose and story
When assessing a commercial deal, two of the first things the credit team looks at are the security and the purpose of the loan.
Corrie recommended putting your “best foot forward” by giving credit a clear overview of why the transaction makes sense, including the security, LVR and how the funds will be used. That could include purchasing a commercial property, releasing equity for working capital or investing in equipment, vehicles, raw materials or business expansion.
Clear broker notes, supporting documents and early conversations with your BDM can help give credit the full picture from the start.
Different businesses need different ways to verify income
Self-employed clients do not always fit neatly into one income verification method. The webinar covered Full Doc, Alt Doc, Lease Doc and Lite Doc options for different circumstances.
Full Doc may suit clients with current financial information available, while Alt Doc can provide another option where tax returns are not yet complete. Lease Doc can focus on the strength of the commercial lease and property, while Lite Doc may suit clients with limited financial documentation available at the time.
The key is understanding the client’s circumstances and using the documentation that best reflects their current position.
Looking at the property and purpose together
Commercial Lending can cover a broad range of properties, including retail shops, strata offices, industrial property, storage units and some commercial vacant land.
One important consideration is whether the property has another practical use. Corrie explained that properties with a broader resale market can be easier to assess than highly specialised assets designed for one purpose.
The webinar walks through several real examples involving different property types, borrower structures and income verification methods, including Full Doc, Alt Doc and Lite Doc. Across each scenario, the focus was on understanding the client, the property, the purpose of the funds and how the overall transaction fits together. It also highlights how factors such as property use, business history and the reason for the funding can influence the way a deal is assessed.
Good preparation can make a difference
Commercial Lending can involve more moving parts, so a well-prepared submission is important.
Katie and Corrie highlighted the value of clear broker notes, having supporting information ready and workshopping questions with your BDM before lodging. They also discussed the role of communication once an application reaches credit, with many questions able to be resolved quickly over the phone.
For brokers, the takeaway is to give credit a clear picture of the client, security and purpose from the outset.
Watch the full webinar to learn more about Commercial Lending and how to approach different business scenarios with your clients.
