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Major aggregator launches white label offering

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Australian Broker | 20 May 2015, 08:00 AM Agree 0
Major aggregator launches new range of dual-funded white label home loan products
  • Patrick | 20 May 2015, 11:04 AM Agree 0
    The continued move by aggregators into product supply, ie vertical integration, will exacerbate calls for the banning of commission. What exactly will most brokers offer in return for a service fee, given the service they provide is really a client capture service for lenders? There appears to be a correlation between the rise of bank ownership of aggregators and the rise of vertical integration. Caught red-handed in the wealth services sector they slink off into a new area seeking more profit at everyone else's expense.
  • Kym Dalton | 20 May 2015, 11:27 AM Agree 0
    Patrick, very insightful. Thanks.
  • Spring-A | 20 May 2015, 04:00 PM Agree 0
    I wonder if the borrowers who are going into these white labelled products are told who exactly the lender is behind the transaction prior to signing the loan agreement and mortgage?

    I'm sorry but I think white labeling loans is deceptive conduct as there are legalities that borrowers should be made aware of in the beginning - like - if something goes wrong in the origination of the loan, who ends up who's agent, and who is the principal?

    This knowledge is pertinent as its the longest term and largest contract most borrowers ever go in to. Courts are ruling that brokers are agents of borrowers, but if the borrower is told that the broker is the lender... but they are not - it could be seen as misleading or deceptive. Just saying!
  • Michael Kent | 21 May 2015, 09:16 AM Agree 0
    As much as I have tried I just don't see the appeal or even the reason to have these products.

    OK the rate is competitive but the "who?" factor raises its ugly head every time.

    I was so sick of my clients asking who Connective are when I mentioned the product I just stopped putting it in the mix.

    Consumers need a trusted proven brand attached to such a major part of their financial world. Why do you think most people go with a CBA or NAB or ANZ even when they know the rate is higher?

    Brand recognition is paramount and why banks spend tens of millions of dollars on branding and marketing.

    Would you buy a no name car? Probably not. A TV possibly, a fridge maybe but your home loan? 95% of the time the answer is no.

    A broker then has to be spend a hell of a lot of time convincing the client Connective is a big player OR we have to say the bank behind it is NAB or Macquarie. Then confusion reigns supreme!

  • Pepper Me Not! | 21 May 2015, 01:28 PM Agree 0
    You seem to take aim at brokers however (companies like) Pepper had no problem buying up numerous loan books originated by brokers where white labeled products had been sold to consumers where the act of white labeling loans had been responsible for disguising the real identity of the actual lender that the consumer was entering into legal relations with, and companies like Pepper have had no issue with profiting from the resecuritisation of these sort of dodgy loans.
    Where is the 'certainty of contract' in any of these deals? In my opinion, it is clear that there has been no certainty of contract and those deals should not form the basis of legal action for possession of mortgaged property.
    I agree with Spring-A that the practice of white labeling loan products to deliberately disguise the identity of the real lender is deceptive and unconscionable.
    The only thing I possibly agree with you on is that brokers are an unnecessary layer of obfuscation that provides no service and should be done away with.
  • Patrick | 21 May 2015, 02:37 PM Agree 0
    Some misconceptions here. It is vertical integration where advice and product are supplied by the same entity that irks me, not "white label" loans per se and certainly not brokers as I am one and an ethical one if I may say so.
  • Spring-A | 21 May 2015, 11:31 PM Agree 0
    Patrick - I'm looking for an ethical broker ... please provide a contact web or email address so that I may contact you for advice. Cheers.
  • Patrick | 22 May 2015, 11:06 AM Agree 0
    Spring A: Common Cents Financial Services Email:
  • Maria Rigoni | 22 May 2015, 01:42 PM Agree 0
    The confusion is deliberate.
    It is to hide the fact that our banking sector is over concentrated with very few lenders.
    Mortgage Mangers should never be called a mortgage broker because they are not nor can ever be as mortgage broker accreditation to introduce borrowers to a specific lender product are given only to individual humans not businesses.
    Bank owned aggregators give their owner bank access to every product and policy and interest rate and individual broker volumes of all their competitors.
    No politician or regulator have I heard voice or demonstrate a concern for this.
    The banking system needs real reform to bring it back to being an essential service that the people have a right to have.
  • Ray Perth | 24 May 2015, 02:01 PM Agree 0
    I don't use white brand products, end of story. Simple reason as there is ALWAYS better deals out there in the market by established front line lenders (banks and non banks).
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