After creating a new head of broker role geared towards assisting broker diversification, a specialist lender has had a record volume of loans through the broker channel and is recruiting additional staff just to keep up.
MoneyPlace is growing at an annualised rate of 250%, with the broker channel now responsible for half of its loan volume. The lender plans to hire on a rolling basis to keep up with the demand after having already brought four new recruits to the service team.
According to Alf Vasta, head of broker at MoneyPlace, the success has hinged on shifting the broker mindset from using personal loans as a means to secure an asset, to becoming a step in the home ownership process.
He explained, “Where we’re really helping brokers to diversify is in not just thinking about a personal loan for a specific asset, but as a tool to face challenges pre-, mid-, or post-mortgage.”
A significant area in which personal loans can be of use to brokers is in helping with debt consolidation for borrowers preparing to apply for a home loan, especially after APRA’s recent changes to credit card debt and the heightened requirement from banks to ensure mortgage applicants don’t have other outstanding debts to pay down.
“From a client point of view, [a personal loan] will help with servicing, it will help with their cashflow but, most importantly, it will make the deal a lot more presentable to the lender down the track,” said Vasta.
MoneyPlace offers three- five-, or seven-year unsecured personal loans ranging from $5,000 to $45,000, and relies on risk-based pricing to generate a personalised interest rate for each borrower between 7.65% and 26.99%.
The lender also provides a two-minute estimate form that supplies an indicative interest rate without impacting the potential borrower’s credit file.
“Education is crucial for communicating to brokers that we are completely different from the previous personal loan model. For us, it’s all about providing the solution, giving the client the best possible rate we can, and getting it funded as quickly as possible. From lodgement to funding, 48 hours. That’s where brokers really see our value,” said Vasta.
There will be more on this story in issue 16.13 of Australian Broker