Loan Brokers Market Expected to Reach $1,061.79 Billion by 2031

According to a new report published by Allied Market Research, titled, “Loan Brokers Market," The loan brokers market size was valued at $251.00 billion in 2021, and is estimated to reach $1,061.79 billion by 2031, growing at a CAGR of 15.7% from 2022 to 2031.

Moreover, a loan broker represents interests of borrowers rather than interests of a lending institution. They act not only as their client’s agent, but as knowledgeable consultants and problem solvers. With access to a wide range of mortgage products, a broker can offer their clients the greatest value, in terms of interest rate, repayment amounts, and loan products. In addition, loan brokers interview their clients to identify their needs and their short- and long-term goals. Many situations demand more than the simple use of a 30-year, 15-year, or adjustable rate mortgage (ARM), so innovative mortgage strategies and sophisticated solutions are the advantage of working with an experienced loan broker.

On the basis of application, the home loans segment is the highest growing segment. This is attributed to the fact that a home finance brokers offers a wide range of loan options from a number of different lenders. The greater the broker’s experience and network, the better is the client’s opportunity to obtain home loan and interest rate that best suits their needs. Another advantage of hiring a broker for obtaining a home loan is that it is subjected to a low interest rate.

Region wise, North America attained highest growth in 2021. This is attributed to the fact that consumer demand for mortgages in North America region increased, owing to surge in home buying during the COVID-19 pandemic and as a result of low interest rates that have made refinancing attractive in past two years. Furthermore, housing prices generally follow cyclical trends and demand for loan brokers increases with improving macroeconomic variables. In addition, low interest rates, combined with falling unemployment and growing capital markets, have increased the housing market and thus strong demand for mortgages and loans for which clients are hiring loan brokers for getting good deals in loans. These factors, as a result promotes the loan brokers market growth in the region.

During the COVID-19 pandemic, customers postponed their plans on purchasing new homes, cars and other personal expenses for which they would have taken a loan through a broker or independently. Therefore, the services of a lending broker were not in much demand during the pandemic. Therefore, the COVID-19 had a negative impact on the loan brokers industry.   

Key findings of the study

• By component, the products segment led the loan brokers market share in 2021.
• By enterprise size, the large enterprise segment accounted for the highest loan brokers market share in 2021.
• By region, North America generated the highest revenue in 2021.

The key players profiled in the loan brokers market analysis are Ally Financial Inc., Bank of America Corporation, Caliber Home Loans, Inc., Flagstar Bank, Interactive Brokers LLC, JPMorgan Chase & Co., LendingTree, LLC, loanDepot.com, LLC, LaGray Finance, Macquarie Group Limited, Mortgage Choice Pty Limited, PennyMac Loan Services, LLC, Rocket Mortgage, LLC. , The PNC Financial Services Group, Inc, Wells Fargo, Moneypark, and Hypomo. These players have adopted various strategies to increase their market penetration and strengthen their position in the industry.