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With growing uncertainty ahead of the post COVID-19 era, brokers who are more versatile will be able to come out on top. Before the pandemic, the market was in a state of growth, which seemed it was going to continue until March. Brokers, lenders, and borrowers will be better positioned for growth if they can shift their focus to multiple options and assets that are still currently growing. 

Lenders are positioning themselves by creating tougher standards for loans. They “are scrutinizing a borrower’s business or employment income. If a borrower entered into a forbearance agreement on their commercial mortgage, home loan, auto loan or even credit cards, lenders are walking away from these borrowers and their corresponding deals due to concerns about the borrower’s ability to repay a loan” (Diodato). The uncertainty surrounding what comes post COVID is creating lenders to be more cautious on what borrowers can repay, and they are often now looking for future data on rentals, and how those rentals have been performing recently. This is to see if the property can continue to survive, or if it is too risky for the lender. The types of properties that this is most affecting is office space in urban areas, hotels, and retail stores as the shift to online shopping becomes more prevalent (Diodato). While lending has become stricter it is still active in most areas.

The importance of having cash reserves is extremely important now that lenders are toughening guidelines. Brokers should explain to their clients the “need to have realistic expectations, and be prepared for the extra scrutiny and security lenders now seek, such as requiring the borrower to keep enough cash in reserve to cover 12 months of principal and interest on the loan” (Diodato). Additionally, brokers need to continue to keep track of lending changes in the market and monitor areas that are continually receiving lending. This will allow brokers to market deals to lenders that are attractive and have a higher rate of success. 

For borrowers and investors, it is important to focus on areas that are continuing to thrive in the current market. One of which is essential business operations, which will continue to receive funding as non-essential businesses will face tougher scrutiny. Additionally, the single-family rental market is continuing to do well. This is because “renters are fleeing densely populated urban areas for single-family rentals in the suburbs that afford privacy, social distancing, a yard and perhaps a pool. Financing is readily available on multiple fronts for the single-family investor market, including fix-and-flip, buy-to-rent and portfolio mortgages” (Diodato). With homeowners and investors having more time at home due to the work at home method that a lot of the country is doing right now, the time involved in fix and flop is less of a restriction, and it may be a more attractive option because of that. 

Lenders, brokers, and borrowers are all having to shift their focus and guidelines due to the pandemic. Due to this it is vital to look at markets that are continuing to provide returns when seeking lending and before investing. By becoming more versatile in asset classes and locations investors can position themselves for growth. 


Daniel Murphy

Lee-Chandler Acquisition Analyst


Diodato, Rob. “Survive in a Tougher Market.” Scotsman Guide Media, Oct. 2020, 

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