As we enter the second quarter of 2024, I’d like to reflect on our lender community’s growth and collaboration over the past few months. If I had to select a phrase to describe what we are hearing from lenders these days, it would be ‘cautious optimism.’ Lenders still want to lend and picking the right opportunity is top of mind. Talks of rate reductions later this year continue to spur thoughts about how to handle if and when we get any rate relief. Overall, we have seen many lenders move into a slightly better liquidity position from recent “deposit attracting” strategies, while others complete significant sales of loans to clear up room on the balance sheet. All these actions signify positive moves to prepare for new opportunity ahead.
We’ve been very impressed with many of our lenders who, despite high delinquency rates and interest levels, remain eager to introduce new loan products to attract borrowers that meet their current balance sheet objectives. Being nimble is the name of the game today and those lenders who are putting in the work and effort, appear to be receiving the reward! Even if loan volume is lower than it was a year ago, the flexibility of shifting and offering competitive loan programs to entice the right borrower persona, average loan term, or balance is paying off when it comes to acquiring new consumers.
To that end, we’ve been spending time closely with our lenders to create offerings that align with their financial goals and cater to their merchant community’s needs—including credit card programs, HELOCs, and other unsecured products. The biggest accomplishment of our collaboration is the recent launch of our HELOC offering. This additional capability has been met with positive feedback from our lenders, enabling them to offer larger loans to merchants facing capital constraints, all while mitigating risk with a real estate secured instrument!
If you’re interested in discussing our insights further, or how to tailor an embedded lending strategy to your business goals, please don’t hesitate to reach out to anyone here at LoanStar. We’re always here to help!
Best regards,
Eric Snyder
Chief Revenue Officer, LoanStar Technologies
