White labelled and other, more ‘mainstream’ products share important differences as well as similarities. So, in what areas do they go head to head and where are they less competitive?
WHEN IT comes to selling white label products, one of the big pluses is the similarity they bear to mainstream loans with which brokers and borrowers alike are already familiar.
It is a mix of similarities and differences, however, that determines whether a specific product will be successful.
When selling white label loans, brokers often emphasise the similarities to a branded proposition in terms of product, process and price.
The product is then further promoted based on its differences – in service proposition, benefits to the broker and client overall, and post-settlement service.
“A good white label solution is competitive from a product and price perspective and provides competitive commission levels – but most importantly, it can be easier than a mainstream lender,” says Stephen Moore, CEO of Choice.
The similarities are what make the products easy to use – and easy to sell. Most white label solutions are structured and packaged in much the same way as regular loans.
“In terms of white label products, they’re very similar to the mainstream bank products,” says Joe Sirianni, executive director of Smartline. “The main difference is the brand of course, but the products are basically the same.”
White label loans offer standard variable or fixed rate solutions, and they simplify the loan process.
“The features of our products match virtually any of the other lenders’ [products],” says Trevor Scott, CEO of PLAN. “We typically match anything the other lenders can offer.”
White label loans, however, are increasingly competitive on rates.
“It’s very competitive,” says Mr Scott. “We always find on our PLAN Lending comparison tool on our Podium software that it’s among the top two or three lenders.”
Andrew Russell, general manager, sales and distribution, at Mortgage Choice believes rates in the white label market are moving in the right direction.
“The pricing is starting to improve with some very, very sharp fixed rates,” he says.
David O’Toole, acting chief executive of FAST, also believes these good rates are one of the most significant benefits of a white label proposition.
“Our rates are very sharp,” he says.
In terms of competition, Mr O’Toole believes white label products are most prevalent in the non-major sector.
“Our FASTLend product doesn’t try to be everything to every customer. It’s our philosophy to keep lending simple,” he says.
“We’re keeping it as simple as possible for customers and making sure that, from a rates and policy point of view, it’s market leading.”
The simplicity of the products is another integral part of white labelling.
“Our suite is firmly geared towards customers who are looking for a simple mortgage,” says Brett Halliwell, general manager, Advantedge Distribution.
The strong service proposition associated with white label products is based on a broker’s ability to deal directly with the lender, the speed of approval, close communication and post-settlement service.
With white labelling, says Mr O’Toole, it all comes down to service.
“One of the key features of the FASTLend product is that it’s a very strong product, but it also has a very strong level of service,” he says. “We always make sure turnaround times are good.”
According to Mr Scott, PLAN brokers can get formal approval for their white label loan applications in as little as four days.
This is achieved through use of a strong team – all working under the same aggregator brand. With fewer conflicts of interest, loans are turned around more quickly.
“You should have better access to decision makers, credit assessors and more reactive service,” says Choice’s Mr Moore. “We put our money where our mouth is. We have a good service proposition, both from access to credit assessors and with turnaround times.”
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