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Jessica Darnbrough
There are growing concerns among some brokers that the third party distribution channel could lose out to lenders who market cheap online home loans directly to borrowers.
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Speaking at an industry roundtable hosted by the Commonwealth Bank of Australia last week, Mortgage Choice’s Leanne Miller said the online channel “absolutely poses a threat”.
“A lot of borrowers are rate chasers and there are online lenders out there who are offering home loan rates we simply cannot compete with. In this respect, online absolutely poses a threat to us in the future,” she said.
“That said, there is nothing we can do about it. We certainly can’t stop technology from improving and we cannot stop borrowers from going direct for their home loans. All we can do is continue to offer excellent service that borrowers will not and cannot get anywhere else and hope that the service is enough to lead to business.”
But while Ms Miller is convinced the online space will continue to grow and potentially prove to be a threat to broker market share, it seems not everyone agrees.
Red Concierge’s Sarah Wells said while online has a space and will “no doubt continue to grow”, it does “not necessarily pose a threat to brokers”.
“I, like a lot of people, am happy to do my research online. But, once I have done the research, I look for someone to talk to. I do not think borrowers are ready to take the human factor out of mortgages,” she said.
“I have a lot of clients talk about the rates U-bank offer, and I always encourage them to check out the lender and see if it is for them. Once they have looked at U-bank and realise that they are not going to get the same level of support from the bank as they would their broker, they ultimately decide to use the services of their broker. I can honestly say I have never lost a deal to U-Bank.”
Mortgage Choice’s Bianca Long agrees and argues that borrowers respect and need the services of a professional mortgage broker.
“This is their biggest asset,” she said.“I always ask my clients: if something goes wrong with your loan, are you happy to handle the problem over email? Or, would you prefer to deal with someone over the phone or in person straight away?”
