No corporation anywhere would be doing it any differently. Not Microsoft, not Apple, not Telstra, nor any other organisation that dominates its particular market.

My view is simple- its simply about restoring some balance. If they didnt have 90% of the market, I think you’d find they wouldnt be so quick to impose the kinds of changes they have and will continue to. A bit of lost market share would give them something to think about.

In a nutshell, they are in a position to take us all for granted as it stands right now. With each month that passes, their position gets stronger and stronger. There is absolutely no compelling reason why 9 out of 10 loans have to go to 2 or 3 lenders. Surely with the quality of alternatives available, we can all find a way to reduce that down to 5 or 6 or 7 out of 10, and send a couple to the little guys who keep these larger banks honest.

So you can appreciate why I don’t share your faith at this point in time. I watch as we ignore all the extremely clear and dangerous signs screaming at us, and cannibalise ourselves slowly through our ignorance, handing almost total control of our incomes and our industry to the giants that make up the 4 pillars.

Its certainly not for want of completely valid alternatives. Its simply because we refuse to use the alternatives. So it’s not a matter of the non banks “getting there”, they ARE there, and have been for over 6 months! We’re the ones who haven’t arrived yet!

Nope, no argument with you there. I’m pretty sure we’re on the same page, other than a couple of minor points.

The Aussie example was simply a way to communicate the ‘culture’ of a group whose methodology is to manipulate a lending panel (and cynically claiming it keeps their brokers honest) so as to ensure that there is little incentive to write anything other than brand products.

I mean, 3 years ago when non bank lenders were flying, the banks didn’t have the squirrel grip on the market like they do now and their business volumes proved it.

When the non banks get pricing parity with the majors again and it’s getting their now), then I’m sure it’ll be on for young and old.

Apologies if I have misconstrued your post, but as you say, I think the important things here is that we all agree that as brokers we have a role to play in changing things that adversely affect us. We may not be able to change lender policy individually but we can and should work together to ensure a fair and workable broker market exists where clients can get a better deal.

Of course it’s not acceptable to write non bank loans if they aren’t as suitable or more competitive than major bank loans. That would of course ,be unconscionable. But the point is- they are! Take a look at infochoice or cannex or your own lender panel and see for yourself. There are many options available in the non bank sector offering better value, features and service than any bank products. I think infochoice released a report only 2 or 3 weeks ago showing about 50 or 60 better deals than the best bank deals.

So I’m not suggesting for one moment that any of us write non bank deals purely out of self interest, just to look after our own needs/concerns. Unless those products are strong value propositions, they don’t deserve our support. But they are!

It is not the aggregator that is showing very little support to the non-Banks as they do not determine where the loan is placed and tell us at every PD day to spread the love around. It is up to the broker to really look around. That is what we are being paid for. Placing your own needs/concerns above the clients is a sure way to end up in COSL and ensure no return business (and is just plain wrong). We may not like sending business to the Banks but if it is the best thing for the clients we will continue to do so (unless/until we lose access). Problem for us is we do large loans, not volumes of small ones - so keeping accreditation based on ‘number of deals’ for all 3 of us becomes increasingly difficult. I want access to the majors because sometimes they are the best choice (even if their commissions and service are poor by comparison [excepting ANZ]). If I lose it, then I can not give my clients the best service, but I will not send them there just to keep my accreditations. That is just wrong too.

So if that’s a reasonable assumption I have made ( and I think it is) any broker who has access to products that offer a comparable or sharper rate, comparable or better features, fewer fees and faster turnaround times than major bank loans, and then doesn’t recommend them simply because they are from a NON BRAND lender, could reasonably be labeled an order taker?? And wouldn’t it then also be fair to say that they aren’t really doing what they purport to do- look after their customers best interests? I’m not suggesting for a moment that the loans they write aren’t perfectly good products and well matched to the customers needs. No one is ripping anyone off I’m sure, but I am suggesting there are even better matched loans for the customers, and because its a little tougher to sell them, its a case of too many of us taking the easy option too often. We cant continue to do that and then complain when it bites us on the arse like its started to.

Regarding the second part of your post- that being paid the same no matter what loans someone writes is why non banks don’t get more business; again I have to disagree. This may apply to Aussie, but besides them there are few aggregator models where brokers get paid the same no matter what loans they settle. None of the largest aggregators have models like that. They either take a fee per loan, or a percentage/flat monthly fee. So someone please explain why AFG, PLAN, CHOICE, MORTGAGE CHOICE, CONNECTIVE etc etc, who are all bigger volume writers than Aussie, also show very little support to non banks?

I would argue that many independant brokers (i.e. free to choose any product if accredited and available) do select a fair few non bank lenders.

In fact, the last three deals I’ve processed have been non bank.

But here’s the rub. Product & lender choice is broadly speaking, mine to make.

Why. Because my business is mine. My aggregator charges a small fixed fee per deal without volume filters or contractual constraints and I can secure accreditations with lenders that my aggregator doesn’t have on the panel.

I’m a boutique (read small) mortgage manager able to price branded prime and ’specialist’ lending products if I choose without any aggregator involvement.

I can (& do) secure finance from interstate lenders as well as smaller, private lenders capable of satisfying a lending niche.

So do you reckon an Aussie Home Loans mortgage broker could do the same. I mean, even the pricing thing is irrelevant here. They get paid the same for any lender that is chosen. Why jeorpardise a deal with poorly known brands for clean skin deals, even if the lenders were available?

The problem I think is that the vast majority of mortgage brokers in Australia who think they run their own business are in fact, merely a small cog in the wheel of their corporate masters distribution model.

Now, if mortgage brokers decide to chuck the ‘brand’ and then control most of their own business practices then sure, I reckon they’d write a lot more non bank loans.

But I just don’t think they have much choice in all of this other than to write bank loans.

I can’t prove this of course, but it seems logical enough.

We see elaborate ideas for launching new models and reinventing the wheel. Debate is fantastic, and these ideas are noble but overly ambitious in the extreme. The set up costs alone are prohibitive, and seriously, how would it change anything? Lets get to the core of it, and talk about what almost everyone seems to want to avoid - 90% of business at every aggregator goes to major banks now. The aggregator is irrelevant. The results are the same everywhere. Will that magically change with the introduction of a new aggregator? It’s a complete nonsense. Noble but naive.

If you want the banks to reverse these policies, try this. Write some non bank loans. About 20% of your deals is all it will take. Better make it real quick though. We are FAR closer to tipping point than we realise. The banks now have almost 92% market share! Better get your priorities sorted out real fast!