4 Reasons Every Experienced Lender Should Have a Construction Loan Program
As an experienced lender, you know that with diversification comes risk but it also brings the potential for reward. Ten years ago it may not have made sense to move into the construction loan sector but today, with the latest construction loan tools available, it easier than ever before and provides better margins. Read on to learn why we think they are such a good idea and then contact ECL Software at 800-625-5972 if you need help setting up the support network for your loan program.
1. A Construction Loan Program Can Help You Recruit New Employees
What is the most important part of running any successful business? Access to the best employees. The best way to attract them is to show that your business is growing. In fact, studies have shown that one of the best ways to recruit employees is to have a good growth strategy. Even if the new hire in question does not work on construction loans, the fact that your company is more diverse may encourage them to accept an offer.
Likewise, construction loan programs can help you retain top talent because it gives them products to master. When a person is at the top of their career ladder, they are likely to look for something new to do. Let your construction loan program be the new mountain for top talent to climb.
2. Keep Your Clients in House Instead of Sending Them Elsewhere
If you are an experienced lender then you have surely been asked to handle construction loans as well. What do you say? Do you have a go-to company you refer clients to? Does that company you refer them to also service the types of loans you do? If they do, then you have just sent business to a competitor. Even if they don’t, are you sure that they won’t refer your clients to their own preferred companies for the loans you provide?
When you have your own construction program you can skip the hassles and the what-ifs. When they ask you if you can handle their loan, you can simply say, “Yes!”
3. Stabilize Your Sales Force During Times of Fluctuation
If you are relying primarily or solely on refi business then you are likely dealing with significant fluctuations in business. Construction loans offer a great way to stabilize your sales force and allows you to stay ahead of your competition.
4. You Get More Fee Income
It’s true that construction lending is riskier than conventional lending but it’s also true that the profit margins are higher. For example, if you originate 203K loans and can securitize them right away, you can make 5 or 6 points.
At ECL Software we work to make business easier for construction lenders. Reach out to us today at 800-625-5972 or via email to get your free demo of what our software can do.