The banks’ battle to attract borrowers has intensified over the course of the year, but what are the consequences for brokers? This month we ask…Has increased competition between lenders in the current market resulted in greater channel conflict?
JEFF FALCONER, Park First Home Loans
“Definitely. The banks are not afraid to look for volumes anywhere and everywhere – including brokers’ clients.
That said, if you have a good client relationship, increased competition can be really positive. I have benefited because more customers have put their hands up and asked us what they have to do to get a better deal. While it’s great that customers have more choice, there needs to be a good reason for a broker to refinance a client.
PRISCO MINICHIELLO, Duffy & Simon Lawyers
“We, as brokers, must continue to exercise sound and professional business ethics. If the big banks’ offering is the best for the client, we should continue to include them in our assessments; more importantly, we must not ignore the non-bank lenders if their products fit as well. If we don’t lose sight of what makes mortgage brokers a better choice for consumers, the current conditions will in time turn for the better.”
MARK DAVIS, ALIC
“There has always been a degree of ‘perceived’ conflict between broker-sourced loans and the banks’ own proprietary channels. [You could argue] that propriety channels have a distinct advantage, yet they themselves are also restricted to their parent entities’ products. I believe the banks have done a reasonably good job of promoting neutrality amongst the channels, at least in perception.
KEVIN LEE, Smartline
“The lending space overall suffered significantly in 2011 from falling demand. Due to falling volumes, channel conflict is alive and well, yet again, with the big four. The joke is on the banks though, as they often undercut themselves to win a deal that they already had in the bag. Although channel conflict is a real pain, we actually delight in beating the banks at the game they’re not good at: caring about our clients.”
PETER KISS, Franchisee Aussie Kingsway
“When I consult with a customer, I position myself as on their side and establish trust, thus not providing any reason for them to go and ‘shop’ me against the lender/bank that they have chosen with my guidance.
Competition has actually driven more customers to my franchise as they know that a bank will only discuss their own products whereas I will help them compare different products from different lenders.