Online brokerage enters third-party channel

“That means any lender or mortgage broker can make value-based bids to beat out the panel without having to pay any fees or commissions to Unbiased,” Ms Lee said.

“Some pretty simple, but sophisticated technology then allows impartial comparison of both flongle bids and panel lender loans which borrowers can access wherever they have an internet-connected device.”

According to Ms Lee, the “broker bias” has been removed as the brokers who work for Unbiased are paid a salary, rather than commissions.

“In terms of monetisation, our technology and organisational efficiencies mean we operate on 0.65 per cent Unbiased Advice Charge payable on release of all bidder contact details or on loan settlement if our customer opts for our panel lender loan,” she said.

“All trails and upfront commissions are paid to our customers' nominated loan account on a monthly basis and borrowers can deduct our Unbiased Advice Charge from those rebates if they wish.”

However, Sydney-based broker Matt Dimos of Yellow Brick Road told The Adviser that the industry has seen this type of service before, such as Refund Home Loans which went into administration in 2011.

“The kind of consumers that would be going to seek the services of a company like Unbiased probably don't care too much about the company's longevity because the clients that they're building their business on probably don't carry a lot of loyalty,” Mr Dimos said.

“A lot of the clients that this sort of model will attract are clients that are going to them purely for rate fees and the fact that they get the commission back, so they don't value the professional side or the advice side, or the service side as much.”

Mr Dimos noted that as the industry grows more complex in terms of product and lender choice as well as policy changes, consumers will prefer the more personalised service of a traditional broker rather than salaried brokers used by the online channel.

“In this industry, people that are offering these services and getting paid a salary don't have to follow-up and don't have to provide an excellent level of service because they don't need the referrals,” he said.

“I think Unbiased have marketed it really well and that's probably why they will get a lot of business, but I would question the longevity of it.”

[Related: New website will charge clients to see brokers]