We asked Tanya Sale, CEO of fast growing aggregator Outsource Financial, to explain why brokers need to look outside of mortgages to be successful, and how MoneyPlace has helped to fill a gap in their lender panel.
Q1. Tell me a little bit about Outsource Financial’s proposition to brokers.
Outsource Financial is a full-service aggregator that focuses on working with the professional sector including accountants, financial planners and high-quality lending professionals.
We offer a full suite of lending along with multiple diversification products including personal loans and motor vehicle and equipment finance. We also provide a high touch service and support to assist our members in growing successful, multi-faceted businesses.
Q2. Can mortgage brokers simply rely on writing mortgages anymore?
If a lending professional seriously wants to create a business with longevity, it is a smart idea to add diversification products.
Opening the door to additional markets like personal loans also allows lending professionals to be less vulnerable to industry changes.
In this ever-changing landscape, you have to be on the front foot. When I talk to our members, I always tell the story of when the financial planning sector took an absolute hammering and we saw many financial planners leaving the industry as they just could not survive.
The one’s that rose from the ashes were the one’s that had other income streams such as lending. If it were not for them having a business that was diverse, they would have joined the masses in leaving!
It is exactly the same analogy that applies to today. You have to put in place additional income streams, retention processes and give yourself every opportunity to grow.
Q3. How should brokers think about diversifying their income in 2018?
The more products that a client can obtain from one trusted professional the more “sticky” they become, i.e. they are less likely to look elsewhere when they can obtain everything they need from one trusted professional.
I believe gone are the days when a business just offered one service. Yes, they offer their core service, but then have a couple of ‘bolt-ons’ to compliment.
Q4. Personal loans have been ignored by traditional brokers in the past. Why is this changing?
The landscape we will see going forward in this space will not be the landscape you would have seen in 2017.
Banks are now obliged to change their policies on credit cards, i.e. they can no longer offer instant limit increases on credit cards. Now is the time to capitalise on that.
There is around $30 billion in outstanding credit card balances, so the idea of consolidating a 20% revolving credit card into a 10% amortising personal loan is really a ‘no-brainer’.
Traditionally, personal loans have attracted high-interest rates which may have deterred writers from offering them in the past whereas this is now not the case.
Brokers should not be putting their core business at risk. If they refer the client directly to a lender, then they risk that client going back to that lender for all their other needs.
My question is why would you not put a strategy in place where you can lodge a personal loan online and get an answer within 10–15 minutes and ensure that you have just assisted in providing a great consumer outcome!
The message I want to get across here is that mortgage brokers should use personal loans as leverage to build their business. What comes from that is the opportunity to grow with the client. You all of a sudden know their assets and liabilities, and it allows you to have a conversation about the future and be part of that journey with them which could lead to other offerings such as mortgages, etc.
Q5. You recently added MoneyPlace, an exciting new fintech for personal loans, to your lender panel. What attracted you to them?
The MoneyPlace team are very motivated and focused on the third-party channel.
Their application form and dashboard is slick and broker-friendly. It takes around 12 minutes to complete an application, so in a business sense, it is cost effective for our members to have this offering on our panel.
Having direct access to their credit assessors was a major component. It was imperative that our members were given the right processes to allow them to stay front and centre of each transaction, so the member retains and maintains the relationship with their clients.
They are an award-winning company (5 stars from Canstar and Experts Choice Award from Mozo) and are very progressive in this space.
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