Lender’s self-employed mortgages rise by more than a third

Bluestone Mortgage’s volumes of SME-focused Clean Slate, Lite Blue and Business Easy products increased by 37 per cent between the second and third quarters of 2016, which has been attributed to the growth of the SME sector, as well as the strength of the company’s products.

According to Civil Society Australia, the SME market accounts for 69 per cent of the workforce. However, lending to many of the self-employed people who work in the SME space has traditionally been quite difficult, as they often do not have the relevant financial statements or income tax returns etc, says Royden D’Vaz, national head of sales and marketing at Bluestone Mortgages.

Speaking to Mortgage Business, Mr D’Vaz said: “Banks are now going further up the curve and looking at their book and who they are lending to, which opens up the opportunity for non-banks and the specialist banks, because customers still need to access that credit, they are still looking for solutions.

“So, lenders like us have got to start providing those solutions, especially as I'm not too sure that the banks want to find solutions or products that will suit these type of clients.”

He adds that Bluestone’s line of credit facility that enables clients that have been ABN registered for just three months (instead of the standard 24-month period), have been particularly successful, as it “benefits day-to-day operations by alleviating immediate cash flow issues”.

Bluestone has also highlighted it has customised its products for the sector, for example by removing the need for Loan Mortgage Insurance and raising the LVR to 85 per cent, giving clients “greater flexibility and access to quicker, more customised financial solutions”.

Mr D’Vaz commented: “We continue to receive positive feedback about the accessibility and flexibility of our self-employed products that are designed to resonate with the millions of Aussies who traditionally have found it difficult to source finance.

“We’re solely focused on specialist lending, and channel our efforts exclusively on providing brokers with solutions designed to assist and benefit more customers – especially for self-employed borrowers.”

Mr D’Vaz said that the company has expanded its national team of BDMs and credit assessors to support brokers in finding a financial solution for the increasing number of self-employed and small business clients. 

[Related: Lending change to ‘fuel surge in SME owners’]