As published in Scotsman Guide's Residential Edition, July 2005.
Residential originators can increase income by including commercial loans in their repertoire.
The excuses that commercial loans are “too difficult” and you “don’t know anything about them” are not acceptable reasons for missing out on a major income source. Think of the advantages of being able to advertise that you do residential and commercial loans. It could help separate you from other residential brokers in the community.
Would that increase your standing with residential- and commercial-real-estate agents? You bet.
Take the bull by the horns
In recent years, residential originators have learned to direct any clients seeking commercial loans to a commercial lender, who would do all the work and pay the broker a fee. Generally, these lenders are limited to loans of as much as $1 million and smaller properties in which larger commercial lenders are not interested.
Although this approach works for brokers who do not want to be involved with commercial loans, it denies an opportunity for brokers to build reputations as successful commercial brokers and deliver loans from $500,000 to $50 million.
Do not get spooked by larger loans. They can be easier to deliver than smaller ones. Many years ago, there was a T-shirt on sale with a mouse looking up at an elephant. The caption on the shirt read “THINK BIG.” Do likewise and do not hand your commercial clients to anyone. Otherwise, you will not see them again and will miss out on any future income from satisfied commercial clients.
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