Online Portals Pose No Risk To Brokers MFAA Said

Online portals and the Internet present no threat to the broking industry; these are only tools that potential borrowers use to get initial information about home loans, Phil Naylor, head of the Mortgage and Finance Association of Australia (MFAA), said in response to a local broker’s warning.

Naylor’s comment follows an article published in Australian Broker on 8 February, in which Mortgage House’s managing head, Sarah Roberts, sounded the alarm by saying that big lenders were “stealing” customers from brokers by rolling out fancy interactive websites featuring direct-to-borrower loan applications which cut the brokers out.

While the Internet is an important tool for home buyers, Naylor does not believe brokers need to worry about flashy websites. Home buyers usually browse the Web to research property deals, the best locations and weigh up their finance options. However, face-to-face contact with an MFAA broker is vital when it comes to closing a deal, Naylor said.

The majority of prospective home loan borrowers (81%) are tapping the Internet as their primary source of information, according to MFAA’s own research. However, Naylor pointed out that using the Internet is only an initial step that precedes the contact with a mortgage broker.

There is no risk of the broker industry “fading away,” as Roberts alerts, as it is the broker who ultimately arranges the loan for the customer during face-to-face contact after the client has done their initial research over the Internet. It is a growing financial services sector providing over 40% of home loans to the market and the record funds spent online by industry representatives helps brokers to connect with their potential customers, Naylor added.

Rob Kelly - Managing Director

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