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Regional Finance Solutions’ Todd Allomes (pictured above) is busy as a regional broker even if one line of lending is quiet because of his diversified portfolio across consumer, business, rural and SMSF lending.
Allomes, based in Tamworth in NSW and servicing the surrounding North Western New England region, was a 33-year veteran of the banks before moving into finance broking in 2017.
His background in banking means he is now able to service consumer home and investment loans, small to medium business loans, equipment finance, as well as rural and SMSF lending.
Allomes said that this means “business is constant and there is no quiet time”.
“Having diversified capabilities usually means that if one area is quiet then something else is firing up to fill the gap. The activity is consistent though there might be a different focus,” he said.
This is the case in business lending, where he has clients in a range of industries and categories.
“If, for example, retail is a bit subdued, then rural or other sectors will step in to fill the void. The same can be said of the consumer side of the business,” he said.
First-home buyer business is more quiet in the region now than it has been for the last two years.
This has been overtaken by consumer refinancing queries – often from clients that Allomes has not placed with a lender himself – who are phoning out of the blue to compare their loan to the market.
“I’ve had a lot of inquiries around refinancing due to the RBA rate moves of the last 12 months. It’s getting more active and using up a lot of time – it has become a bigger time and application program on the consumer side of the ledger,” he said.
Businesses, meanwhile, are still “looking to expand and do things”, Allomes said, and anecdotally the region seems to be adjusting well to the rising rate environment.
“My client group are not having issues with their loan commitments – I am not seeing any distress in my book at the moment,” he said.
“I think it is fair to say that, generally speaking, people are changing their habits as they get used to the changing cost of finance.
“There is still activity and things are still happening. But people are being a bit more cautious about what they are doing rather than going and doing it and then thinking about it later,” he said.
Loyalty to the banks has declined in the region over the years, Allomes said, as it has become harder for consumers to “talk to somebody”, with bank branches closing down in some smaller towns.
“The way it used to be – where a branch manager would be well known – really doesn’t exist any more, so the connection to banks and branches is less defined,” Allomes said.
This can be harder on customers in regional towns than in city locations, he said, just because of the distance of travel to get to a branch than in a city location where it might be the next suburb.
This has presented opportunities for brokers to provide customers with superior lending service.
“The ability and desire for brokers to know their clients and work with them and then present the best case to the lender, outlining what is needed and why, is important,” he said.
However, that often means being realistic about a client’s situation.
“You don’t want to get it wrong. There will be times where we say, ‘today’s not the day, and here’s a plan to get to a point where what you want to do becomes feasible’,” he said.
Allomes said that creating a diversified broking business would be easier for a broker who already deals with a lot of self-employed customers for their investment and home loan lending.
“Stepping into the small business environment is still the same process, it’s the same information but different products. From that point of view it is not hard to bolt on business lending.”
However, he said brokers looking to expand from PAYG clients into business lending would need to train and understand what financial statements show, so they can present them well to a lender.
For Allomes, the future will be more of the same. “It’s about looking after clients as best you can and relying on what you do for clients to generate word-of-mouth recommendation,” he said.
“That has always been the driving force of my business. Trusting what you do for people will satisfy them and they will want to tell others what you are doing is worthwhile inquiring about.”
Are you looking at diversification to shield you from the ups and downs in the market? Share your thoughts or stories on this topic in the comments section below.
