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Tips For Starting a Lending Business

Tips For Starting a Lending Business
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Looking to join the exciting world of money lending and finance? It can be a rewarding career that engages people from all walks of life looking to grow their wealth. 

If you’ve been flirting with the idea of joining the real estate sector from the finance side instead of vending or buyer’s advocate, it can be a lucrative and fascinating job. Here are some tips for starting and growing a great lending business.

Lending and broking – two similar but parallel careers

Before you can lend money, you’ll need a credit license and professional accreditation. A credit license doesn’t just extend to lenders but brokers. 

Brokers don’t lend out money directly but engage other banks or lenders through a lending panel to provide the best products you can recommend to clients. If you want to become a mortgage or home loan broker, you may need to have some professional development or academic training under your belt first.

You’ll also need a clear criminal record, good financial standing, and a spotless credit history to become a broker. Some exceptions may apply – but don’t automatically assume they will.

Being a broker means putting together a lending panel yourself – which is more difficult than it seems. Some banks may not want to touch an unknown quantity. Though, there is a “shortcut” to becoming a broker: aggregation.

Credit aggregation as a shortcut

Engaging a credit aggregation company is a shortcut to assembling your own lending panel.

Instead of chasing them down yourself, aggregation offers instant access to a lending panel that is already in place but only operates virtually. Megabanks, credit unions, non-conforming lenders, and even insurance companies are all represented in these aggregators. With the help of these, you can offer your customers the same range of options as well-known firms that can afford to invest heavily in billboards and TV advertising.

Aggregation services usually provide professional development and compliance training to serve your best interests. It may also build up consumer credit compliance-ready document acceptance and links to credit reporting organizations to pre-screen loan applicants.

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Set yourself apart with value adds

As a home loan broker, you may quickly make value enhancements to your website or business. One idea is to partner with a real estate lawyer to give clients ready access to crucial legal services when buying or selling.

Loan calculators are value-added services you can quickly add to your website so that customers may estimate how much their loans will cost them over time. Another is to employ white-label energy comparison to assist them in locating a beneficial energy deal before moving in. You might also collaborate with a moving business to provide moving services at a reduced cost.

If you provide personal loans, you may include services like fleet vehicle purchases or agreements with travel companies if customers borrow money for vacations or honeymoons.

Remember to consult other brokers and professionals to see if this career is right for you!

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