Vow Voice 22nd February 2019

As credit parameters continue to tighten across the industry, more and more brokers are turning to specialist funding sources to provide solutions for their customers. The Resi Renew & Restart range of loans not only provides more flexible prime solutions for those that don't quite fit the mould of the mainstream lenders, but they also provide the most competitive Near Prime and Specialist Lending solutions in the market.

Here is a 2-minute wrap up of what Resi can offer:

Near Prime: No risk fees up to 85% on most products

• Unique pricing proposition which minimises entry costs (no risk fees for many customers) making our solution the cheapest in the market for those that need a funding solution as a stepping stone back to prime lending.
• Full Doc, Alt Doc (Declaration of financial position plus one of: Accountant Letter; 6 months Bank Statements or 6 months BAS) Construction (both Full Doc and Alt Doc) solutions are available.
• Unlimited defaults, judgements and writs up to $1,000 accepted (paid or unpaid)
• Unlimited defaults, judgements and writs > $1,000, registered > 24 months (paid or unpaid) accepted
• Discharged from bankruptcy (1 day accepted)
• Debt consolidation for an unlimited number of debts including a payout of ATO debts

Resi's loan product is the best in the market for someone that needs a solution today and intends to refinance into prime within 2 - 4 years' time.

Specialist: No risk fees up to 85% on most products

• Unique pricing proposition which minimises entry costs (no risk fees for many customers) making their solution the cheapest in the market for those that need a funding solution as a stepping stone back to prime lending.
• Full Doc, Alt Doc (Declaration of financial position plus one of: Accountant Letter; 6 months Bank Statements or 6 months BAS)
• Unlimited defaults, judgements and writs up to $1,000 accepted (paid or unpaid)
• Unlimited defaults, judgements or writs from 1 credit event < 12 months (paid or unpaid)
• Discharged from bankruptcy (1 day accepted)
• Cash out up to 80% LVR for acceptable purposes including renovations and business use
• Debt consolidation for an unlimited number of debts including a payout of ATO debt

Submission

• Submission is via Apply online via Resi - Renew / Restart range, but credit assessment is carried out directly by Resi's funder fast-tracking the process for you.

Finally, gone are the days where borrowers seeking a Specialist Lending solution have to put up with basic loan functionality. Resi's solutions offer 100% offset facilities and a great online banking platform.

At Resi, with their Renew/Restart range, they act as caretakers for your clients until you can place them in a Prime Loan offering!

Interested to find out how to secure long terms clients via Specialist Lending, get in touch with the team, they will step you through the process.

Download Resi Rate Sheet Here

By Jessica Haddad

As of Wednesday 20^th February, a significant number of broker and consumer emails have been sent out to the Local MPs. With over 12,624 broker emails and 16,444 consumer emails, our voice is being heard. We must, however, keep the momentum going and continue to spread the word asking friends and family members for their support.

The number of online petitions to date are available on the, Your Broker Behind You, website. The figure is currently sitting at 63,579 and continues to climb.

Now is not the time to sit back, we must continue to act by sending a letter to your Local MP and encouraging others to get involved.

It's very simple, all you have to do is visit Your Broker Behind You and follow these 6 steps:

1. Click on 'Email Your Politician'
2. Enter in your postcode
3. Select your Local PM
4. Enter your Name and Email Address
5. Tick the consent box to confirm you wish to send the message to your chosen politician
6. Click 'Submit'

By Annie Kane - Source: The Adviser

Prime Minister Scott Morrison has voiced his support for the broker channel and outlined their important role in the mortgage market.

Following his address at the National Press Club on Monday (11 February), Prime Minister Scott Morrison was asked questions from the floor.

During this question session, Mr Morrison was asked about his stance on mortgage brokers, given the radical changes put forward by Commissioner Hayne in his final report for the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.

The Prime Minister said he was puzzled by Labor's response to the royal commission, in which they agreed to the recommendations before they saw it, adding it was "unwise".

"I commend the royal commission for the outstanding work that they've done. But I don't think they would expect the government to just, sight unseen, say they were going to support all the recommendations. I never understood them saying that and now they find themselves boxed in."

'We want to make sure that Australians still have access to that service'

He continued: "We have the Productivity Commission report on mortgage brokers which basically says: 'If you start turning that industry on its head, you just hand the power back to the banks'.

"Now I don't see how that achieves our objective, and that is why we have been extremely cautious on that point and that is why I'm not surprised that mortgage brokers are very angry with the Labor party.

"And these are tens of thousands of small and family businesses that help mums and dads get a good deal on their mortgage, so they don't have to just face the banks themselves.

"It's a pretty important service. We want to make sure that Australians still have access to that service," he said.

"Now, what Bill Shorten is going to do, who knows? He still hasn't responded to the royal commission report."

A pledge to brokers

When asked to talk directly to the mortgage brokers of Australia about the changes, he said: "Mortgage brokers understand, with the cautious way we've responded to this report, that we understand the important role that they play in the community.

"Yes, the royal commission has recommended some changes that will need to be absorbed over time, and those businesses can absorb those over time if they are done in consultation and we work together. But I want to see as many mortgage brokers in this country five years from now, in fact, more than there are today.

"I don't want to see this sector wither on the vine and be strangled by regulation that would throw them out of business, but more importantly, would deny choice and competition in the banking system."

The Prime Minister continued: "If there is one thing that we have learned through this process, it is that we need more competition. We need more options. We need more choices. Not fewer. And that is what the Treasurer and I are concerned about in terms of how we would go forward on that one recommendation (on broker remuneration).

"So, they have my pledge that I get how important they are to Australia, Australian families, and Australians who want to buy a home and we will work closely with them (so) that we deal with the things that we need to deal with. And many of those mortgage brokers have told us there are things they need to deal with. And that is fine. But we will do it in a partnership way that makes the sector stronger, not weaker," he said.

The Prime Minister was also asked whether he would like to see anyone from the banking and financial services industry go to jail following the final report from the royal commission, to which Mr Morrison responded: "In this country, it is courts that determine that. That is how it works.

"Everyone should face responsibility for their actions and be accountable for what they have done. And matters have been referred off for those cases to ASIC and the other regulators to take forward and they will be pursued and they will end up in court, I have no doubt, and then courts will decide. But what I do believe, is that all of them have to be accountable for their actions."

He continued: "So, what can I do about that? I don't run the courts. But I can introduce a piece of legislation called the Banking Executive Accountability Regime, which for the first time in this country, makes senior bank executives accountable, directly and personally, for the decisions that they make whether they are criminal or not, whether they have a negative impact in a serious way against Australians, small and family businesses around the country, and that legislation enables APRA to run them out of town so they can't go and work in another bank and do the same thing again.

"I can set up the Australian Financial Complaints Authority... and I can make sure that they can take cases going back now 10 years (over the same course that the royal commission was looking at) so they can get access to their justice too. And that is happening now as we speak.

"So there are a lot of actions I can take to ensure that people face accountability and face justice and we are taking those actions," he said.

The Prime Minister and former Treasurer added that the appointment of Daniel Crennan as ASIC's deputy commissioner and "chief litigator" formed part of government's moves to see ASIC "pony up" and "go to the line, take these things to court".

"Dan Crennan is a very good litigator and I'm sure will be doing an excellent job. So, yes, I want to see people face consequences for their actions," Mr Morrison said.

Glenn Mitchell, Head of Commercial & EF YBR group, would like to congratulate all our award nominees and winners at last week's 5th Annual Commercial Conference. Over 150 mortgage brokers, lender partners both YBR and Vow staff attended the picturesque Launceston Country Club in Tasmania.

The conference opened on Wednesday evening at Penny Royal Launceston, with our CEO Frank Ganis providing a moving speech about the importance of change and resilience during this time of industry and regulatory change. We opened our second day with both Peter White, CEO FBAA & Clive Kirkpatrick, General Manager, YBR Lending addressing all aspects around the Royal Commission findings. Tony Wilson complimented the keynote speakers and has an impressive background having worked with overseas top grade sporting people around wellness, change and performance in everyday life.

Our National Commercial winners in 2019 were GFS Finance Melbourne, a group who have only recently joined Vow Financial a little over 3 years ago, moving across from AFG.

By Charbel Kadib - Source: The Adviser

The non-major lender has unveiled a new broker strategy and expressed support for the third-party channel amid heightened scrutiny.

Citi Australia has revamped its mortgage offering in an effort to broaden its appeal to the broker network, while also stressing the pro-competitive contribution of the channel in light of the banking royal commission's recommendations.

Speaking to The Adviser, Citi's head of mortgage distribution, Matt Wood, said the bank has developed an "increased appetite" for "substantial levels" of home loan volumes.

Mr Wood noted that the bank had primarily focused on "high-net-worth" clientele, which he described as "affluent and globally minded", but said that Citi has revised its strategy, broadening its appeal to home loan customers via the broker channel.

Citi launched its new appeal to the broker market with the promotion of its Citibank Basic Mortgage product with an interest rate of 3.55 per cent (3.60 per cent comparison rate) for owner-occupied loans and 3.89 per cent (3.94 per cent comparison rate) for investors.

"We've been quite niche for the last few years, and what this offer has enabled us to do is to broaden that and enable us to be a bit more accessible to the wider broker community," Mr Wood said.

"It enables us to attract a different type of clientele, but probably not as high-net-worth as what we've experienced in the past few years.

"The average loan size for the full calendar year 2018 was, on a national basis, $940,000 - substantially higher than our nearest competitor in the market place."

He added: "Coming out with this offer and promoting it to our partners enable us to widen the net a little bit and just allow that appetite that Citibank has returned to the market with to be quenched."

However, Mr Wood acknowledged that the scope of the offer is "narrow" to ensure that "service levels don't deteriorate", noting that the offer predominately targets refinancers.

"By narrow I mean that there's an application fee of $399 that applies to it, we're not allowing it for new purchases or pre-approvals, and the loan repayments are solely principal and interest.

"We're (also) targeting salaries of PAYG applicants, and an LVR ratio of 80 per cent is the maximum. We're not allowing cash out to be a part of that.

"It's really designed for refinance business and for the fairly consistent style of a PAYG applicant."

Mr Wood also claimed that its credit card offerings, technology platform, and its 13 BDMs would also ensure that brokers can better service the needs of their clientele.

Citi on RC recommendations

The bank also recently released a statement in response to Commissioner Kenneth Hayne's recommendations in the final report of the banking royal commission.

Citi highlighted the role that brokers play in enhancing competition in the mortgage market, in light of Commissioner Hayne's call for a borrower-pays model, which the industry has warned would hand power back to the major banks.

"Citi has been following the royal commission closely and has reviewed the findings," the statement reads. "At Citi, we believe that competition is good for customers and an effective broker distribution channel gives customers greater transparency and choice."

Citi also welcomed the federal government's response to Commissioner Hayne's broking industry reform proposals.

"We welcome the measured approach being taken by the government as they work through the recommendations and find solutions that provide good outcomes for consumers."

Please find attached the latest Broker News from Teachers Mutual Bank, Unibank & Firefighters Mutual Bank.

In summary, the communications advise as follows:

The Bank is making changes to its lending policy across all brands of the Bank being:

• Firefighters Mutual Bank,
• Health Professionals Bank,
• Teachers Mutual Bank and
• UniBank

The changes are effective Tuesday 19 February 2019.

The revised calculator can be downloaded here, and lending reference guide can be downloaded here, which reflect these changes. These will also be updated on TMBL's portal.

More details about the changes can be downloaded by clicking the button below:

Broker News Issue 132 - Credit Update