Refund model revival: Naked Mortgages makes its case

by Mackenzie McCarty06 Dec 2012

Refund model mortgage broking may be experiencing something of a revival, with Naked Mortgages serving as one of a handful of firms offering to pass commissions over to clients, but is the model actually viable?

In an exclusive interview with Australian Broker, Naked Mortgages’ Mathew Graham says his business model is a far cry from that of defunct aggregator Refund Home Loans.

“Naked Mortgages is online – Refund  was never online...We're not a franchise and we charge a fee for service.”

However, FrontRunner Consulting’s Doug Mathlin says that, while refund models will likely occupy “fringe” space in the market, they’re not likely to take over any time soon.

“The cost of doing business as a mortgage broker has gone up a lot in the past few years….commissions have come down. The margin that a broker has to play with is actually pretty small.”

But Graham says his business model is “streamlined” and efficient.

“Our business model may be different, but it’s still got a place in the industry.”

To watch the full video interview, watch Australian Broker TV.