One of Australia’s largest aggregators says its partnership with a comparison website to create a digital home loan application service will benefit all mortgage brokers.
The Adviser reported last week that AFG, along with non-major banks ING DIRECT and Macquarie, was testing a 100 per cent digital home loan service with iSelect.
In a media release dated 7 November, iSelect said the service “will allow home buyers to secure conditional approval for home loans without the need to visit a bank or have a face-to-face meeting with a broker”.
Alan Caputo, iSelect’s financial services group executive said, “By eliminating the need for face-to-face meetings with brokers and enabling customers to develop an ongoing relationship with them through phone and email contact, we have created a service that is more in tune with how people are accustomed to operating and communicating today … we feel we have created a digital process with a human touch.”
However, according to AFG general manager of sales and operations Mark Hewitt, “The interpretation from The Adviser that brokers are not involved however is slightly misleading.
“All staff involved are credit reps and hold the appropriate lender accreditations. Their obligations, including those around responsible lending, are the same as for all brokers and are being met with the use of new technologies and some innovative process redesign - supported by the lenders involved.”
The news was met with mixed reactions from brokers. Some defended their business models, which had been built on “personalised customer service and trust”. Others claimed a completely digital service would compete with ‘face-to-face’ mortgage brokers.
AFG’s Mr Hewitt addressed these concerns, explaining that the aggregator is working with iSelect to help break down what is a “clunky and time consuming application process that has hardly improved in my 25 years working in home loans”.
“Our belief is that their ultimate success will be for the benefit of all brokers,” he said, adding that iSelect are to be congratulated for their “courage, investment and perseverance (almost 6 years) in trying to break convention”.
James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.
He has a sound pedigree to cover the business of mortgages and the converging financial services sector having reported for leading finance titles InvestorDaily, InvestorWeekly, Accountants Daily, ifa, Mortgage Business, Residential Property Manager, Real Estate Business, SMSF Adviser, Smart Property Investment, and The Adviser.
He has also been published in The Daily Telegraph and contributed online to FST Media and Mergermarket, part of the Financial Times Group.
James holds a BA (Hons) in English Literature and an MA in Journalism.
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