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As a successful commercial equipment finance broker you’ve mastered the ins and outs of the industry, fine-tuned your skill set, and built a well-oiled broker business. But beyond reaching scalability and expanding your company, what other avenues offer the potential for new revenue streams? If you’re considering becoming a lessor, you may be on the right track to do more for your customers and earn additional revenue from holding your own portfolio.

There are several benefits to holding your own portfolio. Your lease and loan contracts can provide a more predictable revenue stream and will help secure income during economic downturn when brokering is more difficult. Holding your own portfolio also lets you manage the customer experience, guiding end-user relationships to drive repeat business. But most importantly, portfolio servicing helps you build historical performance data on which your business will be evaluated if you ever want to accept outside funding.

But be prepared, the transition from Broker to Lessor is fraught with challenges that even the most proficient brokers struggle with. Some of the major hurdles you may face include the up-front investment in systems and manpower, exposing your company to risk, losing control of the customer experience, and even diluting your ownership in your company. Additionally, establishing a portfolio servicing department can be overwhelming and easily distract leadership focus from the company’s core strength of originating transactions.

The process of servicing a portfolio is often overlooked and requires more resources than most consider. Compiled from the back-office tasks of billing, collecting, customer service, sales and property tax processing and reporting, servicing is vital to your access to affordable lending capital, and if not handled correctly, can stunt the future growth of your company. So, whether you commit to the demands of managing portfolios in-house, or outsource to a third-party servicer, demonstrating healthy portfolio performance while maintaining and growing your origination volume is key to becoming a successful lessor.

The first hurdle will be to acquire capital and start growing value in your company. When starting out, some brokerages consider it smarter to fund from their own capital, or from a line of credit, rather than immediately accept outside investment.

If you do decide to secure capital from outside sources like banks or investors, your servicing history will be under close scrutiny. Like most loans, the cost of funds will be based on what you offer for collateral and your ability to repay. Because lessors often require a large amount of capital, with minimal collateral, even with an efficient portfolio servicing history you could be forced to trade away equity in your company, diluting your ownership and possibly your decision-making power.

Working with outside funding sources can put additional strain on your daily operations. For example, banks have specific regulatory requirements that you must follow, and you will have to adapt your internal processes to accommodate their needs. Then there’s the simple fact that your new partner may also be new to commercial equipment finance, making it your job to educate and guide them through the trial and error period; causing further leadership distraction.

The trick here is to stay focused on what truly adds value to your business and where your core competency lies. As a broker, your expertise lies in the ability to originate business and you do not want to divert your time and attention away from this strength. Wise business owners understand that the three most impactful factors of business growth are maximizing revenue, minimizing expenses and improving the customer experience. Outsourcing the tedious, back office servicing tasks to a third-party servicer like Orion First maximizes portfolio performance by leveraging world class servicing skill, minimizes expenses by utilizing pre-established technology and operations platform, and improves the customer experience by letting them nurture your relationships via white labeled communications keeping your business top-of-mind.

Experienced lessors know that behind every successful business is a strong origination team, solid funding strategy, and effective portfolio servicing operation. Play to your strength, and partner with companies that quickly add value to your organization.


AACFB will be hosting a monthly webinar over the next twelve months to cover this topic in more detail. Additionally, an online Community has been established for those who want to communicate on the topic of transitioning from broker to lessor throughout the year.


  • Log in at www.aacfb.org
  • Click AACFB Members Only
  • Select All Communities from the Communities drop-down menu
  • Scroll down to Building Your Own Portfolio
  • Click the green JOIN button on the right