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Inside New Silver: Tech-Enabled Private Lending with White Label Program · Private Lending Insights

• [00:00:00] Rocky Butani: Welcome to Private Lending Insights. I'm your host, Rocky Butani. In this episode, I interviewed Kirill Bensonov, CEO and founder of New Silver. This is a private lending company based in Connecticut which started off as a technology company t- that built a loan origination software for private lending and ended up becoming a lender themselves. [00:00:20] We talked about their lending activity the past 12 months, the states they're most active in, a little bit about their company history. We talked a lot about technology and AI, how it affects their business and private lending in general. We also talked about their wholesale white label program, which is for private lending brokers and smaller lenders that can partner with New Silver to fund deals throughout the country. [00:00:44] I hope you find this episode to be insightful. Here's my interview with Kirill from New Silver. Kirill, thanks for joining me for this episode of Private Lending Insights. How's everything at New Silver starting out this year so far as far as loan volume and, uh, the growth of your business? [00:01:01] Kirill: Awesome. [00:01:01] Thanks for having me, Rocky. I'm glad to be speaking with you. Um, you know, things frankly started a little bit slower earlier in the year. I think just January, honestly. But, uh, we're- we've definitely picked up steam. We've had a couple of really good months, a couple of record months even. Uh, perhaps, uh, this month might- we might set a new record, you know, for us. [00:01:20] But, uh, yeah, things have picked up quite nicely. [00:01:23] Rocky Butani: Excellent. Well, I, uh, from the stats that I have, uh, uh, about your company from Forecasa and Elementix, I can see s- some sort of the loan volume that you guys are, are funding. Looks like you funded over 150 loans in the past 12 months, which is quite impressive. [00:01:39] And, uh, one thing that surprised me, uh, is, uh, is the concentration of, of where these loans are. Uh, I've seen that you've done, uh, a lot of loans in Texas and Florida, but your company is based in Connecticut. Um, so tell us a little bit about, uh, about the geography of, of the, uh, you know, where you're lending and, and how, how you've been able to tackle those, those markets outside of, uh, the Northeast. [00:02:06] Kirill: Absolutely, yeah. And, and I would say Connecticut is maybe our third, uh, top market, or a, third or fourth, something like that. We definitely love the, the Northeast market, especially these days. I think Connecticut was, like, the number one, uh, growing real estate market, uh, recently. And, um, you know... But the way that we kind of look at it is we look at the data. [00:02:28] We're a data-driven company. We're a tech company. So we look at where the activity's taking place, where the risk-adjusted returns are what we want them to be, and that's where we are. [00:02:37] Rocky Butani: What are some of the states that, that you, that you'd like to do more business in at this time? [00:02:44] Kirill: Connecticut and Massachusetts. [00:02:47] Yeah. Um, and we do, you know, we do a fair amount. Like I said, I think Connecticut is, like, third, maybe Massachusetts fourth, fifth, somewhere in there, so it's definitely top five. But, uh, I do... You know, we still like the home area, and again, the market is really, really good. The data is actually really good here. [00:03:04] Uh, you know, and this, I, I live in Massachusetts, so, you know, the ar- the, the data looks great. Um, and, um, yeah, we, we'd like to kind of continue to penetrate these local markets. [00:03:15] Rocky Butani: And within, uh, the Texases and the Floridas, um, are you still expanding there, and, uh, uh, have you seen any challenges in those states? [00:03:25] Kirill: We are, yeah. We have, I think Texas is... We have, um, a, a few partners there on the white label side, so that's kind of how we, we've grown our footprint there. Uh, Florida is, you know, it's Florida. I mean, it's, everybody's building and there's stuff going on all over the place. We've definitely pulled back from some areas. [00:03:46] I think Florida especially, it's such a huge state that, you know, geography-wise, you know, we, we've pulled back of some of the West Coast, uh, Florida West Coast, I mean, Gulf Coast, um, areas and continue to do business in others. So yeah, we're, we're continuing to grow in those states. [00:04:03] Rocky Butani: How about the rest of the Southeast? [00:04:05] Are you, uh, actively lending in, uh, states like Georgia and the Carolinas? [00:04:10] Kirill: We are. Yeah, we are. I mean, a lot less, I think. I, I, w- w- probably, maybe it's in our top 10, some of those, but I... A fair amount less than, than, uh, Texas and Florida. [00:04:23] Rocky Butani: All right. And, uh, and looking at the stats, I see that you've done some loans in California, which seems a bit unusual for a company of your size based in the Northeast. [00:04:32] Uh, how's it been lending in California thus far? [00:04:36] Kirill: We, we love California. I mean, it's a great market. It's tough to penetrate. Uh, I think we've, we, we... Again, we have a few partners there, and I think we, we have maybe a reputation now for doing some of the ground-up loans. I think we're, we're able to do those. [00:04:51] Uh, and we have a good process, strong underwriting there, and, uh, partners like that. So yeah, we, we are continuing to selectively lend in California. [00:05:01] Rocky Butani: Great. And tell us about the, the types of loans that you're funding, um, most out of, or, or give us a breakdown of fix and flip versus new construction DSCR loans as well. [00:05:12] Kirill: I'd say just, you know, last few months, roughly, you know, f- 40 to 50% fix and flip, you know, 20%, uh, DSCR, and the rest new construction. [00:05:25] Rocky Butani: Right. And are you looking to, uh, grow one type of loan versus the other? [00:05:32] Kirill: Uh, RTL, I mean, b-broa- you know, broadly construction and, uh, fix and flip, that's really our focus. Uh, DSCR is great. [00:05:42] I mean, we, I think we have... We're competitive. We're, we're, we have a good process. Um, but it's not necessarily our main focus. We ha- we initially developed it for refi our, our borrowers. Now it's kind of grown on its own into a, a fair, uh, book value, but, um, yeah, we're, we're focused on RTL. [00:06:01] Rocky Butani: Right. And, uh, how about, uh, property types? [00:06:04] Are you 100% focused on residential, or are you doing multifamily, mixed-use, and other commercial property types? [00:06:11] Kirill: We had some... We had a pilot, uh, for CRE multifamily, and we did a small number of loans there. We kinda paused it for now. We just found that we're, we don't, you know, we're not ready. We don't have a great network. [00:06:26] We may not have the best product out there and, um, yeah, we're spending a ton of time and, and not getting anywhere. [00:06:33] Rocky Butani: Okay. So, uh, uh, pretty much residential one to four units is where you're focused. The, [00:06:38] Kirill: the majority. We, we usually do, uh, you know, something slightly larger, uh, maybe up to eight units, but the majority is one through four, yeah. [00:06:47] Rocky Butani: Okay. Nice. Uh, and let's talk about the market in general and private lending. Tell us about some of the trends you've seen in the past six months or so, what you're hearing from borrowers as well. [00:06:59] Kirill: I think just in general, if I wanted to kind of prioritize what the, the bigger trends are, I think market is continuing to get more and more professionalized it looks like. [00:07:07] You know, there's less... When we start- we started in 2019, uh, very different space. Obviously, everything was different, and, uh, I think there was quite a lot more people doing this as a side gig, and, uh, now we're seeing a lot more professionals. Um, obviously the rise of DSCR as a, as a strong contender for people, uh, whether it's refi or, or new purchase, right? [00:07:32] That, that would keep... That, that appears to continue to, to accelerate. Um, yeah, those are kind of the big things. I mean, I think, I... What we're seeing is people can build from the ground up, they can continue to make money. Fix and flip is just a lot harder. [00:07:50] Rocky Butani: Sure. And, uh, and what are some of the challenges, uh, your borrowers are facing at this time? [00:07:55] Um, are they, um, you know, it- are the, the higher interest rates a, a problem? Is it, uh, is it identifying deals? Is it materials? Uh, what can you share about that? [00:08:07] Kirill: Yeah. From what I hear, it's, it's really about the inventory, the lack of inventory, right? The, the lack of, um, opportunities, and it's tough, it's still tough to find deals. [00:08:18] We-- I haven't really heard on the cost of capital or the higher interest rate too much, right? I mean, if we think about where we were during COVID or, you know, the ze- uh, at, when the, when the rates were zero, the Fed, Fed rates were zero, you know, people were originating maybe in the eights, right? Just roughly, maybe some was slightly below, but we're in the eights, nines in some cases. [00:08:44] I don't think we're far off from where it is today, and rates are zero obviously. So I don't know that people are too put off by the interest rates, um, especially the pros, right? They, they know exactly what the hold time is and how long they need, and how much the holding costs are. Uh, you know, and they're not, they're not scared. [00:09:03] Rocky Butani: Okay. And, uh, how about, uh, defaults and foreclosures? Have, uh, have you seen a lot of defaults in, in your business lately? [00:09:11] Kirill: We have, we have not seen a lot ourselves. I mean, we do have some, but it's, I think overall we just ran the numbers from the beginning, it's, like, less than 50 basis points, uh, overall and now it's minimal. [00:09:23] You know, just the current book, it's minimal, uh, default. Um, no, we haven't. You know, I think it's-- I think if, even if defaults happen, we've actually been able to either work them out or take possession and essentially sell it for, uh, for additional profit, right? In some cases. We've lost money in some cases, but, but for the most part it hasn't been an issue. [00:09:48] Rocky Butani: And, but at this time, um, does it seem like, like there's any, uh, any stress in- [00:09:54] Kirill: No stress [00:09:56] Rocky Butani: Great. Um, all right, let's switch gears a little bit and talk about, uh, your company and, uh, and capital and, uh, and your technology. Um, l- let's start off, just tell us about your company's journey in private lending when you started, how this all came about that, uh, that you got into private lending. [00:10:15] Kirill: Yeah, I mean, we-- I'm a technologist by background, so we initially, the idea for New Silver was a software company. Um, so we built the software first. Um, and we were piloting and testing it, and it was... People liked it. We had a few people testing it and, um, you know, kind of put the cart before the horse, I think, in that case. [00:10:37] And we initially were gonna sell the software, but we, just for sort of market reasons, we decided that's not the avenue we want to go down. And then we, we, you know, we had the expertise. My partner Alex comes from, from the, the, the real estate world, so he was, you know, willing to take on the underwriting side of things. [00:10:56] And I have enough expertise in sales and marketing that we decided that we'll, we'll take a 408 as an originator and, and give it a try, and here we are. [00:11:06] Rocky Butani: Interesting. So, so you started a, a... You built a software that was gonna be a LOS for, for other lenders? [00:11:13] Kirill: Correct. Yeah. Yeah. Our, our idea at the time was, uh... [00:11:16] And we still use our own software. I mean, and, and this is still the crux of, you know, the, what the, the value add is. But the, the idea was that we're gonna build something that was like a Rocket Mortgage for, uh, you know, for the private lending industry, where we would pull data in, smoothly underwrite the pricing, right? [00:11:33] Uh, we, we do that now. Like, we, we do instant pricing. We do that. And it may be a slightly slimmed down version. There's been a lot of iterations, but we still do what we set out to do. Uh, but we do it only for ourselves. [00:11:48] Rocky Butani: Interesting. Okay. And then, um, and then so what year was that again that you, that you started that? [00:11:53] Kirill: 2019. [00:11:54] Rocky Butani: 2019. Okay. And then at what point did you realize that, that it was better to, to be an originator instead of selling software? [00:12:02] Kirill: Yeah. I mean, we actually start-- we built the software in 2018, and then really I say 2019 is when we [00:12:08] started as the originator. We started at some point in 2019, maybe September. So we, we tested it for a while. We studied the market in more depth. Like, we didn't have the best understanding, I think, when we started building the software. By the time we finished building it, or the, you know, this V1, uh, we liked the software so much that we were, we were like, "Hey, we gotta do something with it," right? [00:12:30] But we didn't really feel like we could build a, a great company selling the software. So that's when we pivoted. So really 2019 is, is the pivot. [00:12:39] Rocky Butani: Interesting. And, uh, and how about the, the operation? Tell us about, uh, where you're located and, and, uh, you know, how big your team is and, uh, uh, any background about your company. [00:12:51] Kirill: Yeah. We're about 30 people. We're headquartered in Connecticut. We're a hybrid company. Um, you know, come into the office. I mean, I dr- I live, like I said, in Massachusetts, so I'm about an hour and a half away. Come in maybe once a week, sometimes once every two weeks. The majority of the client-facing team is, is in Connecticut or a drive as some folks are in Massachusetts. [00:13:12] So we all get together, you know, couple times a month, few times a month, depending on the, on the team and the situation, and then everybody else are remote. So when... You know, we built the company to be remote first, and then we kinda switched into a hybrid 'cause there's still huge value in seeing each other face to face. [00:13:30] Rocky Butani: Nice. And, uh, and just to clarify, I forgot to ask earlier, um, the software that you built, have you offered that to any other lenders, or is that, is that just something you- [00:13:40] Kirill: No, it's proprietary. Yeah, we use it ourselves. The only, uh, the only, uh, way to u- use our software is to become a white label partner. [00:13:48] Our partner use sort of... You know, it's not the exact same software, but it's very, very close, and we built like a whole other, uh, a whole other platform for them. [00:13:58] Rocky Butani: Okay. Nice. And, uh, let's talk a little bit about, uh, capital structure. Uh, what are-- how exactly are you funding your deals? Do you have a, a debt fund? [00:14:06] Are you selling most of your loans? Um- [00:14:09] Kirill: We do, we do have a debt... We, we, yeah, we're doing both those things. We have a debt fund ourselves that we, you know, we raised equity, and then there's a, there's a, a capital provider on the debt side. Um, and then we have, uh, you know, four flow relationships with, with asset managers and, you know, we're selling the remainder of the loans. [00:14:26] Yeah. [00:14:27] Rocky Butani: Right. And, uh, and, and how's, uh, uh... Have you had any, uh, issues or, or seen any challenges with the capital markets in, in the past six months? [00:14:38] Kirill: I would say no. I mean, I think, you know, we're, we're not, obviously not the biggest lender and, and not in the top... I don't know, not in the top 50 probably, I'm guessing. [00:14:49] Uh, but we provide, I believe, uh, solid underwriting and, um, good process. And so I think, you know, while we n- may not be the biggest volume driver, we provide product that doesn't default, uh, for the most part, knock on wood. And, uh, and, uh, and I think we, we haven't had a problem. We, we've had long-standing relationships, uh, with both our equity investors and our outside, uh, flow, uh, partners, and we've, we've, we've been lucky enough to continue to have that relationship. [00:15:21] Rocky Butani: Great. And, uh, let's talk a little bit about your technology, your software that you've built. Um, you know, what are, what are some of the, uh, the ways that you've been able to benefit from, from using your own internal software and, and how does AI play into, uh, how you process loans these days? [00:15:39] Kirill: Yeah, ton- tons of stuff there. [00:15:41] I mean, I... You know, we, we automated a lot of, a lot of the, you know, process interactions. A lot, you know, a ton on the processing side, some borrower facing, some, you know, team facing, internal facing. So I mean, I think it's anything from, like, uploading documents. When the borrower uploads docs, we parse them, uh, review them, and sort of provide our underwriters a, a, you know, sort of a simple system, red, yellow, green, in terms of whether or not these documents are, are the correct documents and, and so forth, to, um, you know, integrations with all of our service providers, from appraisal management to, uh, servicing to draw management, to everything else. [00:16:24] And, you know, continuing to build an AI to really do... help us on, on, along the, the whole journey life cycle. Help us and help the borrower. I think that hel- that makes obviously us more efficient. It helps, uh, it helps us make less errors and mistakes, close loans faster, and all of these things help the borrower [00:16:49] Rocky Butani: Do you have stuff built in that, that can detect, um, you know, any inconsistencies in what borrowers provide or, or potential fraudulent borrowers? Uh, has that been, uh, a, a common issue lately? [00:17:04] Kirill: It, it's, it's come up. Uh, I wouldn't say it's common, but it has come up. We've had, you know, our share of, uh, just like I'm sure everyone else in the industry has, our share of potential fraud. [00:17:15] And I think we've had, like, one case way back in the day when there was actual fraud, and it was resolved by, you know, title insurance. Um- We, we have not yet built anything, and I'm not sure that we will, or maybe we'll need to, like, buy this because this is, um, a ve- a fairly complex, uh, uh, scenario, right? [00:17:38] But we don't have right now anything that is in-house fraud detection, AI driven. So that is an interesting avenue, and I think that, you know, it is something that's we are gonna definitely explore. [00:17:50] Rocky Butani: Right. And, uh, and so the-- you mentioned that your, uh, your technology that you've built is, is used by you internally, and then you mentioned white label partners as well. [00:18:02] So, uh, let's talk a little bit about your white label program, uh, what we may also call a wholesale program. Uh, tell us a little bit about that program, give us an overview and, and why did you create that in the first place? [00:18:16] Kirill: Yeah, we created it 'cause I think people were asking us if we have something like that. [00:18:20] And it's, it's really like I said, it's, it's, uh, it's a replica of our software, uh, that is, you know, non- not branded to New Silver. It's white labeled to the partner, so people can go in, you know, upload their logo, create their own mini, you know, mini, mini, uh, portal for themselves, right? And then they can either price loans on there, send term sheets, have their clients come in. [00:18:44] You know, nothing is obviously branded to New Silver. It's, it's white labeled to them. Um, and, um, yeah, I mean, the, the, the program is, is essentially ground-up and fix and flip and, um, you know, I, I think it's a fairly aggressive program where it's, uh, where we do the underwriting and we provide the capital, and it's meant for, you know, smaller lenders, brokers, people like that. [00:19:06] Rocky Butani: The use of technology may not be the first thing on, on a mortgage professional's mind when they're looking at white label programs. Tell us a little bit about the economics. What, uh, what, what's the benefit to, uh, to lenders or brokers, um, as far as, as what they can earn and what the, you know, what maybe the, the splits are, uh, with points and, and rate? [00:19:26] Kirill: You know, off the top of my head, I think it's, I think we take, like, 50 basis points, uh, at the starting rate. There's some gradient scale there, but it's like 50 basis points origination. And they c- you know, they, they grab the rest. They could charge, you know, they can charge, uh, processing fees, things like that. [00:19:41] Um, and then they, they basically would get, you know, the borrowers. We, we, we built our program so that, you know, we, we wanna incentivize our partners to lend at fairly aggressive rates where we think we, we're, you know, we, we believe we're fairly aggressive on the interest rates. And so we obviously they need to make money, and they do that with their, you know, their, their processing and their, um, origination fees. [00:19:59] And then [00:20:03] we wanna pass through the, um, the low interest rates so that we can attract more and more potential, you know, end clients. So that's kinda how it works. [00:20:12] Rocky Butani: So the, um, so the broker or lender, they, they kind of determine what, how many points they wanna charge and then, uh, and then is there, is there a pricing engine that when, when they're entering a deal, they could see all the different options of, uh- That's right [00:20:28] points versus le- you know, and, you know, you could see leverage, uh, and, and credit score affecting, affecting the pricing. [00:20:35] Kirill: Yeah. They would enter all that stuff in. It would spit out, like, what, what, what it would be, and then, you know, they can play with stuff. Yeah. That's how it works. [00:20:42] Rocky Butani: And, uh, how long have you been operating this white label program? [00:20:47] Kirill: A year and some. I don't remember exactly when we launched it. Yeah, a year, year, year and a half. Yeah [00:20:52] Rocky Butani: Okay. And how's it going so far? Have, have you, have you been able to sign up a lot of new partners and, um, and is everyone fairly happy with it? [00:21:01] Kirill: People are happy with it. Yeah, we have, I mean, we have... We close deals every month through the program. [00:21:06] Um, I think we're pretty selective, so we, we put people through a little bit of a process to make sure they're not just signing up and, and, uh, you know, then we'll never hear from them again. So we wanna make sure, you know, that we're signing up partners that actually wanna be partners, and so there's a bit of a process there. [00:21:22] Um, but yeah, it's been going pretty well. We're, we're, we're expanding it. We're all, you know, we're all talking to new people all the time, uh, and signing people up wherever it makes sense. [00:21:32] Rocky Butani: And, you know, you mentioned being selective. Uh, what are some of your qualifications, uh, that you re- or, or requirements for, for someone to qualify for this program? [00:21:42] Kirill: I mean, I think we, we wanna make sure that they have, you know, the right presence, that it's not somebody with a website that says they do, you know, uh, they sell mattresses and now they wanna do a loan, you know. Um, we wanna make sure that they're really niche-focused on the loans that we can help them, uh, offer, uh, that they've, that they've got experience, that they actually have deal flow. [00:22:03] Um, fairly standard type of stuff, but we won't just sign up everyone that w- you know, fills out a form. We, we do talk to them first. We wanna make sure there's a good fit, and that all those things are in place. [00:22:14] Rocky Butani: And, uh, for people who are not familiar with the term white label, it- it's essentially where, where the, the lender broker has their name on, on everything, the portal. [00:22:25] Um, uh, but what, uh, uh, is, uh, is it table funding, or is that dependent on, on what state, uh, they're originating in? [00:22:34] Kirill: It's closed in a, in a generic entity, so it's not, I guess, technically table funded in, uh... It's closed in a generic entity name, but everything else is branded to the partner's name. [00:22:45] Rocky Butani: Got it. And then, so on the term sheet, uh, or on the loan docs, uh, it'll, it'll show this generic entity as, as, uh, you know, some of the fees going to your generic entity? [00:22:58] Kirill: Uh, probably on the... Uh, I'm guessing on the term sheet. I think it just shows the partner's name. Yeah. [00:23:03] Rocky Butani: Great. And, uh, a- and then as far as, as far as offering this white label program, you know, we only mentioned earlier that a few states that you've, that you've done a lot of activity in, but, um, but if you could just clarify for our audience the, uh, the geography of, of your program. [00:23:20] Um, are you lending in most states, uh, across the country, um, or is it, or is it a bit more selective? [00:23:27] Kirill: It's most states. I think in some states they need to be licensed, so it's obviously accordance, uh, in accordance with the laws of the state. So I, I believe in California the, you know, even the broker has to be licensed, right? [00:23:39] In, in a few other states it's the same situation. If there is no license required, then that, you know, then, then that doesn't apply. But we would a- we would be able to operate as long as they're duly licensed and, and we're licensed obviously, um, i- in the states that we... We're in about, I think, 38, 39 states, uh, at New Silver, yeah. [00:23:58] Rocky Butani: All right. Excellent. And, uh, anything else you wanna mention about the, the white label program as far as, uh, as far as the process to sign up and how long it takes, and anything else you can share? [00:24:11] Kirill: Uh, yeah, I mean, you can find more info on the website. Uh, under, I think you just click, uh, on the partner program when you land on newsilver.com. [00:24:19] I mean, the p- the onboarding process if you're, if you meet all the criteria and you're, you're in the business and have deal flow and experience and a, and a nice web presence that speaks to your, uh, your qualifications in the business, I, I mean, get you onboarded fairly quickly. It could be, could be a few days. [00:24:36] Rocky Butani: And are you asking people to show, uh, a history of, or itemized transactions that they've, uh, been involved in closing? [00:24:44] Kirill: We do ask for, you know, for a loan tape and, and, uh, you know, it doesn't... I don't think we ask for a huge amount of detail, but we do wanna see some of that history, uh, and, and just some of the experience. [00:24:54] But oftentimes when we have a conversation, it's fairly clear that, you know, someone who's in the industry, again, they have a website, they've got history, they've got, you know, uh, testimonials. They, sometimes it's, sometimes it's not needed. So it's, it's almost at the discretion of the partner manager to, uh, to, to, to ask for things or not, but we, we do tend to ask for a few things. [00:25:14] Rocky Butani: And the partners that you, that you've signed on so far, do you find that they've historically, uh, done business just pure brokering, and then they're looking for, um, for, for more of a white label partnership, and that's when they sign up with you? [00:25:31] Kirill: Yes, uh, uh, I would say it's 50/50. Yeah, it's some people who actually already have... [00:25:35] And, and some of our folks work with other, you know, other, um, uh, capital providers, right, in a similar situation. Um, but it's 50/50. It's people who, who... We, we do also, we work with brokers, right? So they don't have to be a lender necessarily, right? As long as, as... And we work with some very, very good brokers that, you know, I think it's, it's a tough thing to find in this industry, but, but there are good brokers out there that, that actually understand the products and re- bring real value, right? [00:26:05] That's what we want from a broker. They want to, you know, we want them to bring some kinda value to the end client, right? Not just kind of find the deal and then try to, you know, try to, uh, charge two points for something the client probably could have found, uh, themselves, right? So maybe there's a slightly more complex deal. [00:26:24] Maybe there's, you know, maybe there's other things, and maybe there's a lower cost of capital that we bring versus what they had before. Now the broker can say, "Hey, this is the value I bring." Um, so w- we have, we have great brokers on the, on our, uh, um, um, in our program. And then we have some, some lenders who are, you know, they, they t- truly wanna be lender. [00:26:45] They own their relationship and, and, you know, they, they appreciate the white label nature of how we've built everything. [00:26:52] Rocky Butani: Right. And, uh, as far as, uh, since you mentioned it, uh, uh, talk a little bit about the, um, the pricing or the some of the advantages of, of someone working with New Silver instead of using whatever other sources they've had before for brokering or, or maybe they use individual investors. [00:27:12] Um, w-what are some of the, the benefits? Uh, tell us about leverage or, or pricing for most of your short-term loan programs. [00:27:19] Kirill: Yeah. I mean, I think we, you know, we, we-- our fix and flip program starts at nine. Um, ground-up, I believe, is around ten, um, up to ninety percent LTC. Um, and I think, you know, the, the real... I mean, pricing, I think we're fairly aggressive on pricing. [00:27:35] We're, we're, you know, I'm sure you could find somebody cheaper if you look hard enough. There's always somebody a little bit cheaper. I think that what we bring is, um, you know, we, we, we're not a huge team. You get to know us in person. You know, you get to work with the same person, you know, throughout the whole, uh, multiple, hopefully multiple times that you work with us. [00:27:56] Uh, we bring the technology. W-I believe we bring a great, fast process. I mean, you probably, uh, behoove yourself, if you're researching New Silver, go o-go onto Trustpilot and look at our reviews. I mean, you, you probably find things along the lines of what I'm talking about here from our actual customers. So I do think we bring value, we bring experience, we bring customer service, and we bring technology. [00:28:18] And our pricing is, uh, along the lines of what many others offer, I believe [00:28:24] Rocky Butani: Right. And, uh, this whole white label program, uh, partnering with, with brokers and smaller lenders, i- is this, uh, something that you, that you plan to grow and have become the majority of your origination volume in the future? [00:28:38] Kirill: Uh, we haven't thought about it being the majority. [00:28:40] It'd be great if it, if it continued to grow and, and, and, and sort of percentage-wise was, was growing and overtaking direct business. I, I still think we're, we're a great direct, uh, lender because of, again, the technology is there and it, it, it's there to service the needs of the borrower. So I do think direct lending is, is great. [00:29:00] Um, we are definitely planning to grow it. We haven't thought about it being the majority, but that's not a bad thought. [00:29:07] Rocky Butani: I, I guess that's, uh, that's a good way to scale as, as you rely on, on others to, to bring in the business versus you, you know. I, I mean, obviously you still have your retail channel and, and you could still try to reach borrowers directly, but, uh, but, uh, yeah, with wholesale, uh, it's, you know, it, it just becomes a lot easier because you get one good partner who finds all the borrowers and you get 100 of them or 200 of them, and that's, um, yeah, that's, that's an easier way to get more origination volume is. [00:29:35] Kirill: Yeah, absolutely, and I, I think that is probably the way a lot of companies scaled, right? Um, no, it, it, it's definitely something we're pursuing. We're, we're working actively on that, yeah. [00:29:47] Rocky Butani: All right. And then, uh, tell us a little bit about your thoughts on, on private lending for the, uh, for the future. We're in late May right now. [00:29:55] Uh, uh, do you see any, any major changes happening or, um, uh, anything, uh, that, that you, that keeps you up at night as far as, uh, private lending in, in the future, the next six months or the next 12 months? [00:30:09] Kirill: Well, I think, I think, you know, as we kind of move into the age of AI, obviously what you touched on earlier, fraud is always top of mind, right? [00:30:17] Like we're, we're, we're always cognizant of, of like the changing nature of technology and, and, and the various ways that malicious actors can, can, can... Are, you know, they're out there trying to, trying to figure out how to, how to scam people basically. So that is, that is something that we're thinking about, and that is gonna be a challenge, I believe, for the industry to tackle, right, over the coming months, years, and what have you. [00:30:42] Um, as far as like the market in general, I, I'm hopeful that, uh, the macroeconomic, uh, factors will not weigh heavily on interest rates. And I'm hopeful that we can continue to see a downward trend in interest rates and cost of capital, and that we haven't seen this, you know, the promised, uh, real estate boom after sort of this sl- I guess slowdown, right? [00:31:10] The, you know, whatever's been happening, however you wanna call it. We've kinda... You know, I haven't looked at like sort of the overall transactionary numbers, but I think they've been petering down. You know, in the retail consumer world, you know, uh, transactions are kinda slowly coming down, though, you know, private lenders are continuing to grow. [00:31:30] So I think private lenders are taking a maybe a larger chunk of the overall transaction markets. And that is not necessarily a great thing in itself, in my opinion, but it is what it is. And I'm still hopeful that transactions overall, like I wanna see all transactions go up, right? Just more real estate being sold and bought in this country, and they'll-- that's gonna benefit, I think, our industry and many other industries as well. [00:31:57] Rocky Butani: Definitely. Uh, makes sense. And, uh, since you as a technologist, um, you know, uh, AI is top of everyone's mind, um, any, uh, any trends you see happening with, with AI as it relates to private lending with either, uh, you know, f- acquiring new relationships or, or, or just making the process more efficient of, of closing a loan? [00:32:20] Kirill: Oh yeah, too many, too, too many to list there. But, but I think, you know, I think AI is, is definitely helpful for us, and I'm sure it'll be helpful for the industry. Um, you know, i-i-i-like we, we kind of put AI as like top of mind for the entire team, right? We have AI office hours, we have training, we have, you know, things that we do just to get people... [00:32:42] Because, you know, we see, we see the ROI, like, you know, one person, even if we're just using like Claude or whatever, right? Just for, I don't know. Like we, we just built like a, a skill for appraisal review for certain, for certain things in the appraisal, right? Just, uh, you know, it's not a game changer, but it's, it saves you, you know, 15 minutes, uh, from having to read through it, through and look for those things, and you, you get it done in 30 seconds. [00:33:07] You know, something like that. So I, I do... We see the ROI, um, uh, clear. Um, and I think it's just gonna continue to grow. [00:33:16] Rocky Butani: Do you have any, uh, thoughts about, about AI being sort of the, the main communication for borrowers? If, if let's say someone's inquiring about a loan, uh, and, uh, are they... At, at New Silver, do you still want them talking to a human, or, or do you have any sort of, uh, AI, like they use a chatbot or a, or a voice AI to, to, to get their, their deal screened before they talk to a human? [00:33:42] Kirill: We, we think we wanna give people options, all those things. Or, I mean, I don't think right now AI is not gonna be able to close a deal today. Um, you know, we do have, you know, we have chatbots and, you know, other things and, and automated, you know, conversations and things like that, that are more for like follow-ups or reminders or quick, uh, Q&A type of thing. [00:34:05] Um, we still want them to talk to a loan advisor, uh, at this time I, you know, I, I do think there's gonna be a time, I don't think it's gonna be into this future, but, you know, it's not gonna be the borrower, but it'll be their ChatGPT agent, you know, applying for a loan from 10 different places and then coming back to the, the, the, the hu- the human behind the screen and saying like, "All right, I went to XYZ lenders and this is what I found. [00:34:32] I recommend this one." Right? Like, that's probably, I don't know, maybe already happening, maybe not. Um, but it will happen. Um, but maybe when that happens, we won't need a human anymore to talk to them, right? Because then it's like AI just goes in, agent goes in, we have an agent on our end, they talk, and maybe make a deal, you know? [00:34:53] Rocky Butani: Definitely. I mean, I, I've been thinking about this a lot as well because we're building a, a new platform that, uh, that involves AI to collect the information from, from borrowers. So the... I think one potential issue I could see is that if they're using an agent and they say, "Hey, here's the, the loan request I, I have." [00:35:11] You know, pitch it to 10 different lenders. How do you deal with the back and forth of, of, "Hey, we, you know, we need this information, we need that"? A lot of times it seems like borrowers and even brokers sometimes are guilty of this as well, is, is not providing everything that a lender would need to know in order to even price a deal or determine if, if they're, if they're even interested. [00:35:32] Um, and there has to be all this, all this Q&A back and forth, uh, uh, that would... You know, all that communication, uh, would have to, would have to happen, and if someone has, you know, an agent dealing with 10 different lenders, they're... That could... I mean, that seems like that could be a, a nightmare. Um, a- any thoughts on that? [00:35:50] Kirill: I think, I think the nice thing is that agents won't fib, right? Like, they're not gonna say my credit score is 750 when they know it's 700. So again, if, if the input is bad, then obviously the agent won't have real data, and then they'll ha- they'll, they'll say whatever they're... whatever, whatever they know. [00:36:08] But I think for the... I think it's gonna be a net positive in that, you know, the agent will collect enough, hopefully will collect enough info and then be able to go out and, you know, have that info on hand, uh, and kinda figure out. And it's not just gonna be pricing, right? They're gonna look at whatever the, their important factors. [00:36:26] Who can fund the fastest, or who's in the state, or what's the leverage and all, you know, all the things that borrowers look at that are important to them. And maybe there's gonna be some kinda standardization, right? Like, there's some kinda, you know, private lending protocol that agents follow, right? And now, okay, you gotta collect, like, these 10 docs from your, your, your, uh, human, you know, client. [00:36:47] Uh, once the agent has those docs, then it can go out and source, uh, you know, source information from the, from the list. I mean, that's a bit of a scary thing, you know, 'cause then what happens to sales? Is sales even, you know, a thing? Like, is, is sales really needed, or is it just purely based on agent's understanding of the factors that are most important to their boss, you know, to their human? [00:37:12] Rocky Butani: Yeah, definitely. Well, uh, I'm sure we'll, uh, we'll find out how that all plays out just in, in the next, you know, few years 'cause- We'll- ... or even, even next 12 months as, as this agentic AI, uh, blows up and, and becomes more mainstream. [00:37:27] Kirill: Absolutely. [00:37:28] Rocky Butani: Yeah. [00:37:28] Kirill: It's a fun world. [00:37:29] Rocky Butani: Yeah. Yep, definitely. All right, Kirill, that's all I had on my list for today. [00:37:32] Anything else you wanted to add before we sign off? [00:37:35] Kirill: That's it. That's it. I enjoyed the conversation. Yeah. Thank you for having me. [00:37:38] Rocky Butani: Yep, definitely. All right, thanks for your time, and, uh, we'll be in touch. [00:37:42] Kirill: Thanks, Rocky. [00:37:44] Rocky Butani: And that's a wrap for this episode. New Silver has been listed on PrivateLenderLink.com since 2019. [00:37:50] I'll put a link to their profile in the description. Check out their retail profile. I'll also put a link to their wholesale profile so you can learn more about that program if you're interested. Uh, and that's for brokers and lenders as well. I hope you found this episode to be insightful. Thanks for tuning in and listening all the way to the end.