The Australian home loan market is “broken” and about to experience the biggest change since the global financial crisis (GFC), according to one neo-lender.
Australian Mortgage Marketplace (AMM) has pioneered a new approach to lending by replacing the ‘inefficiencies and inaccuracies’ of the current home loan market using technology.
Chief operating officer, Kym Dalton, said, “Right now, the market is broken with little innovation in the last decade. Existing lenders have breached the covenant of trust.”
According to AMM, lenders treat loyal customers poorly whilst only marginally meeting the requirements of responsible lending conduct.
Headquartered in Sydney and founded by experienced industry professionals, AMM will open for business on 1 March 2019. The group said it is rethinking the entire lending process.
AMM will fund prime loans on Australia’s first mortgage securitisation blockchain.
Dalton said, “Current lending credit assessment procedures are antiquated, resulting in a lack of consistency and lengthy times to approval.
“Products and procedures have not kept pace with fundamental changes to Australia’s work and life patterns, nor have the opportunities presented by advances in technology been embraced.”
The neo lender’s smart securitisation platform ‘Carbon’ leverages distributed ledger technology to deliver increased transparency, security and automation to superannuation funds and institutional investors.
AMM said Carbon will offer operating efficiencies which will create pricing benefits for Australian borrowers.
The lending process commences with AMM’s Intelligent Credit engine. Developed in-house, the Intelligent Credit engine enables partner brokers to provide tailored prime home loans.
Dalton said, “Australian Mortgage Marketplace’s Intelligent Credit takes a holistic view of home loan applications, assessing scenarios on merit, rather than against broad eligibility rules.
“The credit-decision algorithms process applicant information, verified by third-party sources, to provide immediate feedback to the broker and customer.”
This system allows partner brokers to tailor loans to clients’ unique needs and objectives, using scientific risk-based pricing to deliver a unique product, personalised interest rates, and an approval in under 15 minutes.
“Australian Mortgage Marketplace will empower brokers to service customers more efficiently using it’s Broker Plus portal,” said Dalton.
“Australian Mortgage Marketplace is a genuine wholesale lender that won’t compete with a broker for the customer’s relationship.”