Mortgageport has announced that it intends to expand its partnerships with brokers, starting off by offering First Home Loan Deposit Scheme loans through the channel.
Over the weekend, the Morrison government’s First Home Loan Deposit Scheme (FHLDS) officially launched in its full capacity, with the 25 non-major lenders now taking applications from first home buyers (FHBs) with a deposit as low as 5 per cent.
Mortgageport, a non-bank lender taking part in the scheme, announced that it will commence working with brokers across all states to write loans for first home buyers under the scheme.
While the lender has previously partnered with brokerages, the new move forms part of a concerted effort to fulfil its “ambition to partner with a number of mortgage brokers who are looking to grow their businesses”.
The lender has said that it will individually accredit brokers rather than partner with aggregators.
Mortgageport managing director Glen Spratt commented on the lender’s increasing focus on the broker channel: “Mortgageport wants to work with a select number of experienced and larger mortgage brokers collaboratively and provide an offering that will help them attract new customers, not just service their existing customer base.”
“We believe the direct accreditation model will result in closer relationships with our brokers, where we can work together to help them differentiate themselves from other mortgage brokers,” Mr Spratt added.
According to the non-bank, Mortgageport will offers FHLDS loans at a variable rate of 2.99 per cent.
The announcement comes as calls are extended to brokers to act quickly, if they intend to help their clients access the scheme.
According to Tony MacRae, MyState Bank’s general manager, banking, demand has been strong for the two major banks involved in the scheme – Commonwealth Bank and NAB – since they started taking applications on 1 January 2020.
With just 7,000 spots still available in the scheme as the February launch date for the non-major banks passes, Mr MacRae urged brokers to move fast to help clients secure their place.
“We are urging mortgage brokers to check their customer base and act quickly to submit home loan applications pre-approval for eligible customers now, as places in the scheme are limited and allocated on a ‘first in’ basis,” Mr MacRae said.
“We expect heightened demand for this scheme to continue, with Australia’s housing market prices predicted for an upswing in 2020, amid further potential rate cuts and a friendlier lending environment relative to previous years,” he said.
For this reason, he called for brokers to be extra diligent when submitting applications under the scheme, which includes guidelines regarding property price thresholds, customer incomes and other criteria.
“Failure to submit supporting documentation as well as any further information required completely and accurately can result in customers missing out on their place, which isn’t a good outcome for either party,” he concluded.
The NHFIC last year announced its full panel of lenders taking part in the FHLDS, but industry representatives have criticised the scheme for its limited reach and the fact that few of the chosen lenders are making the FHLDS loans available through the broker channel.
Mortgage Choice CEO Susan Mitchell recently highlighted the 10,000 loan cap means that for FHBs, “getting a place in the scheme might be as unlikely as securing a winning lottery ticket”, a concern that has also been shared by other industry leaders.
“While the scheme does what it says on the box and allows some first-time buyers to enter the property market sooner without having to pay LMI, the fact that it is available to such a small number of Australians is disappointing,” Ms Mitchell said.
Are you interested in the issues shaping the roles of mortgage and finance brokers? Don’t miss your chance to hear about all the big ideas for the year ahead, and gain the tools you need to position your business for growth and prosperity. Book your ticket to the Better Business Summit today.
[Related: Brokers urged to act fast on FHB scheme]