From Richard Woodhead, GPS Investment Fund Limited Managing Director
While recently reviewing our loan pipeline, I realised it has been some time since we included a finance broker-introduced loan. When I asked our lending team if they could recall the last one, I was met with a rare silence – something that immediately underscored our relationship-first approach to lending.
Our team have not only built a strong investor base, but an equally direct borrower base. Our standard process of Portfolio Managers leaning on an existing pool of trusted borrowers, is a strategic decision which speaks to the expertise of our team. We personally identify core loans which build the backbone of our portfolios, and therefore, require evidence that the best teams are behind them. This is something we know we can identify, and something we’ve never found a third-party aligns with.
In discussing why broker-introduced loans seldom align with GPS’s lending criteria, a few key factors emerged, and each, at its core, comes back to our ethos of putting investors first:
1. Risk and Return – Third-party referrals typically seek the highest loan-to-value ratio (LVR) at the lowest cost. This approach shifts the risk-reward balance beyond GPS’s comfort level and the investor’s interest. We do not partake in unnecessary risk.
2. Cost to Borrowers – third-party contracts come at an additional cost. By dealing directly with GPS, borrowers benefit from reasonable pricing without the added expense, and ultimately can focus on starting their project sooner.
3. Strength of Repeat Borrowers – We prioritise lending to known, repeat borrowers who have demonstrated their capability and reliability. This consistency and trust built through ongoing relationships are fundamental to our lending approach.
All of this is not to say that brokers don’t have a place in the market. However, GPS’s lending philosophy is built on direct, transparent relationships with both investors and borrowers. This approach has served us well in delivering strong, quality product and ensuring that every loan aligns with our commitment to investor interests and consistency.
