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Non-bank lenders: the what, how and why

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Where you choose to get your home loan from can affect the type of loan you get, meaning it’s important to think the decision through carefully. While many people turn to their bank for a loan, bear in mind that non-bank lenders might be a viable choice for you.

What are non-bank lenders anyway?

A non-bank lender has their own funds (therefore not a bank, credit union or building society), which they lend out with a margin for profit. This can include a company or individual who borrows money from banks at wholesale rates, and then lends the money with a profit margin for themselves.

Mel Finance are non-bank lenders that can help you attain the right loan for you, being accredited with over 30 Australian lenders. One of our new lenders is Virgin Money, who offer a large range of products for both first home buyers and investors.

The perks of going with a non-bank lender

Going with a non-bank lender can possibly serve up numerous benefits for borrowers. Some of these include:

  • Lower overheads, as non-bank lenders will have fewer offices and less marketing and labour expenditure. This means lower fees and better rates for you, as they are not passing significant operational costs  onto the borrower
  • Customer service, because non-bank lenders often go for a personalised approach, having the time to spend quality time with each client. This means you’ll receive more attention from the lender and be able to ask questions, as opposed to dealing with various different people at a bank. Many non-bank lenders even offer phone and online banking customer service to ensure you’re taken care of every step of the way.
  • Quicker approval, because non-bank lenders will often be the loan decision-maker. Mel Finance have received 24 hour conditional approval and have even received 24 hour formal loan approvals in some cases.
  • Wide variety, because non-bank lenders have deep connections with various loan providers and will work to find a loan that best suits you.

While the final decision is completely up to you, it’s well worth considering whether a non-bank lender could suit you. You will be the one making the repayments for a significant amount of time, so make sure you are completely satisfied with the loan and service you are receiving. Turn to our mortgage broker for expert guidance on what is best for you.

Mel Finance are one of Melbourne’s leading Independent Mortgage brokers, working to get people into their dream homes and cars with a loan that best suits them. Contact us today for any questions about the loan process or browse our website for our insights!

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