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ISCOVER
Vivienne Kelly
Shockwaves from the Sunday Telegraph’s recent attack on brokers continue to be felt, with a new business looking to leverage off the confusion spread around broker commissions.
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In a bold advertising campaign in one of Sydney's busiest streets DealMax.com.au is cheekily telling consumers to "Say goodbye to brokers!"
DealMax.com.au, which launched in November, is an online “marketplace” that allows consumers to request private quotes and access exclusive deals directly from Australian financial institutions, according to a statement from the company.
Borrowers are required to enter their details, and their lender of choice will contact them to begin the loan process. Lenders display their advertised rates on the site but can also offer ‘private quoting’ if they’d like to compete more aggressively for a potential borrower’s business.
CEO of DealMax Pedro Goncalves said the model is more transparent than that currently offered by brokers because DealMax only gets a “small fee” for providing a borrower’s details to a lender, and there are no ongoing commissions.
“We provide a neutral, independent environment,” Mr Goncalves said. “We don’t represent the borrower, we don’t represent a lender. We simply provide you with an ability to acquire pricing from a diverse range of lenders and then it’s entirely up to the lenders to compete for your business. You then decide whether or not to take the next step.”
DealMax is paid for providing potential borrower’s details and thus receives the fee even if the loan does not proceed. Mr Goncalves believes DealMax’s model will appeal to borrowers because the company is not incentivised by lenders who have volume targets or offer bonuses.
“There’s no lender who can actually buy distribution on our platform. All our lead fees are standard. We don’t charge one lender more than another lender or promote one lender in order to get a higher lead fee.”
A statement from DealMax indicates the business has been under development for years; however, with recent confusion over broker commissions DealMax could be set to take market share away from brokers.
So far, more than 20 lenders have signed up for DealMax’s service. The company anticipates that by the end of the first quarter of 2013, 30 lenders will be on board.
Mr Goncalves said DealMax will increase consumer confidence in the lending sector.
“We’re trying to deliver a very unique, new age service to the market and trying to empower consumers to better make decisions around their mortgages.”
