Brokers reveal top priority when selecting a lender

by Julia Corderoy15 Dec 2014
The ability to meet customer needs trump commissions for brokers when selecting a lender, new research proves.

The research, commissioned by South Australian lender HomeStart Finance, highlights that the fit of a product with a customer’s situation is the number one consideration for brokers when recommending a lender.

According to the survey, more than half (58%) of brokers said the fit of product with customer needs was the top consideration when selecting a lender for a customer, with 80% placing it in their top three. The ease of the loan process was also highly valued, with 65% of brokers placing it in their top three considerations.  

None of the brokers surveyed said commission levels were their top priority, while only 5% said it ranked in their top three priorities. Having a working relationship with lenders was also considered to be of lower importance, with only 2% of brokers placing it in their top three considerations.

HomeStart’s chief executive John Oliver said being able to meet your customers’ needs is “paramount” in the mortgage industry.

“Word of mouth and referrals are an important driver of new business and the only way you are going to achieve these is through satisfied customers,” he said.

Lenders should be paying more attention to brokers’ needs if they want to innovate and stay ahead of the market, according to Oliver.

“The challenge for lenders is to ensure there are innovative product options available for brokers to offer to their customers – something that is going to be increasingly important as high upfront costs and rising prices make it more difficult for young homebuyers to get a foothold in the market.

“In some cases, there’s little differentiation in products or there may be a wide selection of products available to a customer, and that’s where other factors, such as the ease of the application process, plays a role for brokers.”
 

COMMENTS

  • by Vic Regional Broker 15/12/2014 8:47:04 AM

    This research put paid to assertions in the past that brokers are driven by commission especially if the lender is associated with their aggregator!

  • by Dan - Melbourne 15/12/2014 8:50:58 AM

    Wow - 5% still place deals with lenders whom pay the highest commissions - this is the 5% we can do without - 'cowboys' still exist.

  • by SA Broker 15/12/2014 9:53:48 AM

    Dan - No broker put commissions as their No.1, I'd guess it was in their top 3 as $'s are still very important. I.e. All things being equal with two Banks that meet the Top Two criteria (right product to meet client needs, easy process) you'd have to consider your commission cut - you'd be remiss not to.