LendTrade helps connect loan buyers and sellers using a system its founder compares to Match.com.
Des Moines resident Steve Schipper has been involved with loan trading for more than 15 years. Now Schipper—along with operations manager Heather Bakker—is helping loan traders take out the middleman with his newly launched startup, LendTrade.
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“We built a way to match compatible traders similar to how Match.com does for dating,” Schipper said. “Basically it’s the type of system that I always wished I had access to in the 16-plus years that I’ve been involved in secondary marketing and whole loan trading. It allows buyers and sellers to connect without the large fees charged by the middlemen that help arrange these transactions.”
Users provide information about available opportunities for loan trading and—similarly to many online dating sites—LendTrade’s assessment algorithm effectively matches and assigns Trade Compatability Scores for any potential deals. LendTrade also has a component, similar to LinkedIn, that allows loan buyers and sellers to connect digitally and—Schipper hopes—take those relationships offline.
“I think it’s something needed in the marketplace because trading loans is first and foremost about building relationships,” Schipper (right) said. “Unlike stocks and bonds where you can trade quickly, trading loans requires a long process of cultivating a relationship. It’s more of a dialogue than a trade.”
Similar to LinkedIn, LendTrade will operate on a standard and premium model. The standard platform will be free to users and offers three free connection request credits and one active opportunity posting, while the premium model—plans cost $150 per month and up—allows for unlimited access to the site’s services. Regular members may purchase additional connection requests for $95 each or $375 for five.
Schipper says that compared to the six-figure fee generally paid to middlemen, LendTrade’s monthly fee is nominal. Currently, he says the “ideal target audience for LendTrade is professional loan traders who buy or sell residential loan portfolios.”
LendTrade officially launched over the weekend at the 100th annual Mortgage Bankers Association in Washington D.C. While the product currently is geared toward these individuals—who likely work at banks, credit unions or mortgage companies—Schipper says expanding to other loan markets could be in the startup’s future.
Credits: Photos courtesy of LendTrade.
