What Does A Commercial Broker Do?

Hello and welcome back to the Bridging Finance podcast and we have Scott West from Propertyze here to introduce the company and talk us through the role of a commercial broker. Great to chat with you Scott, how are you? Yeah, I'm very well, thank you. Thank you for having me on. Oh, I'm very glad to hear that. So we've got a list of frequently googled questions here that people are asking. So let's start with this one. For those that aren't really aware then, what does a commercial finance broker do? It's a bit of a generic term. It sounds a bit fancier than it probably is a lot of the time. I tend to break it down as you've got two kind of camps of mortgage broke in. A retail broker, those people take you to the brands you would have heard of. They'll take you

to NatWear, Santander, Halifax, The Mortgage Works. They'll take you to those sort of lenders. As a client, you would probably fit a very basic set of criteria. You've got standard income, a standard property or a standard credit report. If that's the case, you probably fit the retail category, will find a normal broker and they will put you with a retail lender. If any one of those three things, your credit, the circumstances, whether it's on your income or your property are not standard, that's where a commercial broker becomes a bit more valuable. And really it does depend on which one of those three things is the difficult sticking point. If it's a unique property, the certain lenders will go to. If it's the credit or your income, there are lenders that give you either better

lending or they will take a view on what is or isn't poor credit. So the commercial aspect is really taking, as I've described it, a commercial view of the deal because the deal is probably still a very good deal. You've probably got great income and property is fantastic, but you missed your phone bill two months ago. So the deal is a very good deal. So it's taking that commercial view and presenting it to a lender as being profitable or being valuable to a lender. That's what a commercial broker tends to do. Okay, which all makes sense there, a really detailed answer. And yes, so in a way, I suppose you offer a tailor made service to the individual as well in their circumstances. So let's answer this question then. And I suppose this is just following on from what

you were saying there. Why would I need to speak to a commercial broker like properties? Yeah, it follows on really from the introduction. It depends on what your circumstances are and what you're looking to achieve because you may well have standard income, standard property, or standard credit, but you're looking to make a career or a full-time income out of property, in which case a retail broker won't be able to give you the kind of the device or the guidance or contacts that you might need to do that. So for example, we can either help you source properties through our various contacts, give you contact with solicitors, valuers if you want to get appraisers done privately, discuss with lenders or business plans. There are extremes. Some people

just want five, six properties to replace their income. Other people want to build an empire almost. They want to build very, very large portfolio of properties that generates significant income that retires them, their spouse creates well for the kids. And long term, bloodline income planning, the next three, four generations come before. So depending where you sit on that scale depends on what we can do for you. But the first thing we really do is we sit down and we have a chat with you about what issue you want to achieve, because the biggest hurdle we have is that people don't know what they don't know, which is a bit of a corny saying, but I use it very strictly because it really applies to what I do. If I sit down with somebody

for the first meeting and they say, I want to buy a Bikes letter, I want just the one, I want it in my own name, and I want 50% loan to value, because I've got this much money, I inherited the money, wherever it came from savings. When you explain to people that that's a very good idea, I can give you an option or a solution to that, here it is on paper. But here's another solution where you make that money look better for you, you get a better yield, a better return on your investment. And people haven't even thought about it. And when you explain that, people go, oh right, so what else can I do? And you show them maybe the next step or the next step. And some people say, naturally, I'm very, very comfortable being on the low end of that scale, I just want a little bit

of subsidised income. Other people go, wow, I didn't realise that was an option for me. I thought it was unattainable, I thought it was unachievable, too expensive, I thought I wouldn't make my yield back, my returns. When you demonstrate those to people, they can then make an informed decision about what they actually want to achieve versus what their mate told them or what their parents did. So really, the service we offer is fully holistic for everybody on that scale, from one buy to let, investment, property, commercial, wherever it might be, to people who have hundreds, and we do have clients with hundreds of properties. Wow, okay, that's a lot to juggle. So I suppose you've kind of answered the question,

what kind of service can I expect? I don't know whether you've got anything to add to that, but I suppose why do your clients keep coming back to you at Propertyze? So those two things are actually linked. The service we kind of provide is, again, tailored to the individual's wants and needs. If we do just help you purchase or refinance one or two properties, and we put them on a fixed-time contract, and you're not willing to expand, we'll touch basically every six months, give you an update on the market, let you know how things are going, see if we can help you at all, but otherwise, kind of leave you largely to it, and we'll be here if you need us. If you've got large portfolios like some of my clients, they need managing on

a weekly basis, sometimes even daily basis, because their portfolios are very large, there's lots of moving parts, we're refinancing some, we're buying new ones, we're refurbishing another batch, there's lots of things going on, they're trying to do developments. So those clients have a very hands-on relationship with us. I've got several clients that I will speak to probably three or four times a week, almost daily, two of them. Throughout the year, those clients are almost daily. So it really depends on the level of business we're doing and the level of complexity involved, but the service can really range as well from transactional, which is not my preferred method, but whether someone does come and say, I just want to mortgage this property,

or I just want to raise capital for that, can do that for me, and I'll speak to you when it's due its term. The preferred level we have is that ongoing relationship building, where we take you from business plan, we review what you currently got, can we make it cheaper, can we make it better. Are you with a lender that was maybe very competitive originally, but they're quite old, they're quite archaic, their terms aren't great, we're coming to the end of your formal term, can we switch you to a better product, get you more money, or can we make it cheaper. So those are the first things we really look at for someone's portfolio, and then we run an ongoing kind of service with that. So with the legals, we'll manage the legal side of things,

we'll manage the valuer, we'll manage the lender, and in some cases we'll manage the client, chase them up, ensure they're completely reformed they need, return them swiftly, speaking to the right individuals, are they speaking to the solicitor, are they speaking to the valuer, are they instructing them. So we manage effectively the entire process, even though we are on paper, just the broker that sits in the middle, we've managed everything to the from the left to the right side of that whole process. Yeah, so there's a lot involved, lots of factors, and again I suppose like we said earlier, it's sort of like a tailor-made service isn't it? So let's move on then, now you're based in Hampshire,

but can you help someone if they're based elsewhere in the country? In fact, I don't think I have any clients in Hampshire. Right, okay. Yeah, I tend to work with anybody, well, we work with anybody in the country, in the UK, we have clients outside the UK as well, so whether they're expats, expirate citizens, we live now abroad with the UK properties, we help them with their financing, and we have foreign nationals who still reside in their other countries that want to invest in the UK, or invest through the rest of the world. So our clients can be anywhere, from anywhere, with properties virtually anywhere, and we'll cover it all. Wow, okay, so widespread, and I suppose with technology these days it really helps, doesn't it?

Being able to email and WhatsApp people has really changed the way that we do work, because if there's different time zones, it's impractical to schedule a call sometimes, no idea what time it is to buy, but I've got a client who's going to buy currently, but no idea. But if I drop on WhatsApp, they'll respond when it's appropriate, and same with email. So it's quite a fluid way of working, and it can be very instantaneous, can be out and about on a meeting, on the train, and still work with clients who work all over the world. Yeah, it's really useful, definitely useful. Okay, so let's talk about properties then. So when was this founded, and how long have you sort of been in the industry? So properties came into being summer 2020, so I think I've formally formulated the company

in September 2020, but that's when I officially kind of moved to self-employed and started doing this for myself. And I came to the back of being employed, I was working for a very large by brokerage in Surrey, and while it gave me a fantastic leg up, I realized there was aspects that I could be doing better, and I could be doing a much wider service for my clients that I was able to do in that kind of set environment. So yeah, we've been going now for just over two months, two and a half years nearly, and it's going from strength to strength. But myself, I started with finance in 2014, the first job working for a very large bank, but in their leasing side. And then I moved into financial advice shortly after that, so I cut my teeth really in

the financial advice world, which covered pension investments, protection, wealth management, and the kind of tax relief side of things, while I was scheduling certain products to help clients maximize their incomes. We particularly kind of aimed our services to those, what we termed middle wealth families, families that had what would all considered to be good income, 100 grand, 150 grand household incomes, but they weren't quite enough to service the lifestyles they needed for school fees, for example, which is what we actually specialize in. So it was quite a unique way, we had to work really cleverly to work the client's incomes and their investment allowances to maximize how they could put their kids through, most officially put their kids through

program school, which meant creative thinking, it meant problem solving, it meant really just reviewing very commercially the client's circumstances, which is where my love for problem solving stuff and finance came from. Wow, yeah, so you've seen kind of different sides to things as well to the industry. And yes, so sort of like a new exciting venture for you. I mean, we're recording this in February 2023. So I suppose it's like a watch this space, from here on in. Thank you for that, Scott. And I think we must add as well for those that aren't again aware, does it cost for an initial consultation with you? Because I think if it's the first time that you're sort of doing this, it can be quite daunting, can't it?

It can be, I think a lot of people are put off by the idea of paying fees. And there's not to be said for paying a fee to individuals, because I think too many people expect things to be delivered for free, they expect immediate kind of gratification for an acquiring or responses. But that said, our initial consultation is free. So what I've very frank chat to you about your circumstantial goals, what it is you have or haven't got financially. And within the kind of 15-20 minute call, will it be able to kind of establish whether there's, it's worthwhile as having a further and more in-depth chat, or whether it's worth us kind of giving you some really, some really big kind of steps to take, big pointers. And then saying let's catch up in

six months time when those things are correctable, when you've got that and a bit more, we'll have a better chat then. So initial consultation is completely free. If we do then proceed on to further work, we'll discuss that with you at the time and kind of schedule for your groups. Okay, brilliant. And is there anything else you'd like to add, Scott? I mean, we've covered quite a lot there, haven't we? But anything, any final thoughts? Yeah, I suppose it doesn't mean it's commercial broker doesn't mean limiting to just property either. Pretty much we can finance it regardless. Art, watches, boats, helicopters, houses, fancy cars, holiday homes, businesses, for business acquisitions, for raising money in your company

for cash flow purposes, developments for ground up, for refurbished properties. If it can be financed, we can probably help you with it. There we go. So a broad range there, broad spectrum. Thank you for that, Scott. That's been brilliant. Thank you for your time. And I'm sure we'll catch you on another episode soon. Fantastic. Thank you very much. Please note, commercial mortgages are not regulated by the Financial Conduct Authority.