Mortgage Broker Time Pressure Increases with Interest Rate Rises
Educating and supporting borrowers on how to navigate the changing economic environment places extra pressures on time-poor mortgage brokers. We asked Peter White, Managing Director of the FBAA, to share his thoughts on how brokers can keep up with the increased need to work proactively with clients, and the role of technology in freeing up brokers' time.
As interest rates rise, so too does the mortgage broker workload. Educating and supporting borrowers on how best to navigate the changing economic environment places extra time pressures on already time-poor brokers.
We asked Peter White, Managing Director of the Finance Broker Association of Australia (FBAA), how mortgage brokers keep up with this increased need to work proactively with clients. He spoke about the importance of technology for improving processes and freeing up time for client servicing.
Valuable client conversations
Related to the question how mortgage brokers are getting involved in helping clients to cope and preparing them for more interest rate rises and inflationary pressures to come, White said: that mortgage “brokers have been extremely active” and that “there has been a whole host of things happening in the marketplace” that they have done “to assist borrowers with where they are now and in preparation for what to come”.
“You’ve got a whole lot of borrowers fixed on cheap interest rates, but when they step out of that rate, there will be a big differential in their repayments,” he said. “So there’s a lot of conversations and education happening between brokers and their clients about the actions they can take now to soften this blow.”
He said brokers are reaching out to clients to ask whether they are travelling okay and whether their loan product still meets their needs in these turbulent times. “Many borrowers have never been in this situation before, so brokers are spending a lot of time caring for and managing these borrowers.”
How technology is driving broker market share
With mortgage broker market share reaching an all-time high of 69.5% in Q3 20221, it’s evident that brokers are busier than ever. White believes we’ll see the broker’s share of the market rise even further in coming years, thanks to technology’s ability to take on the grunt work.
He explains that technology adoption is driven by consumer demand for faster, more convenient processes. “Brokers are adopting technology into their practices to help them save time and do business better. So as long as we continue giving consumers what they want – good service and speed of turnaround for approval and settlement – our market share will continue to rise.”
“Technology is driving these efficiencies,” White says.
The future direction of broker technology
We asked White to explain where technology is heading in the mortgage broking industry.
“The future is an end-to-end solution that integrates all aspects of a broker’s job,” he predicts. He describes it as smart technology that will integrate the multiple systems that many brokers are already dealing with. “The integration will start on your website and incorporate all your processing, approvals and settlements.”
White said this one-stop-shop technology would significantly benefit the industry. “Many brokers are working piecemeal, using different digital tools or systems for each part of their work, but technology is advancing to the point that these process gaps will join up.”
White was at pains to point out that tech innovation doesn’t take away the human element of mortgage broking. He said it simply gives brokers more time to expedite opportunities and have the people contact that is so important for business growth.
Listen to our Go Talks podcast – Adaptability in the Broker Market – for the full interview. White talks about the changing dynamics of loan applications, the momentum of open banking adoption and the impact of Best Interest Duty (BID) reforms.
The future of technology for mortgage brokers is here with Equifax Fact Finder, a one-page dashboard of credit activity, income and expenses and ID verification. At the forefront of digital advances, this mortgage broking tool uses trusted data and predictive analytics to improve the accuracy of the screening process. Vital information about your client’s credit activity, salary, liabilities, living expenses and identity verification is available in a single place. Mortgage brokers can understand their customer’s financial situation for targeted and relevant loan recommendations without any extra time burden.
To learn more about Equifax Fact Finder or our other mortgage broker tools and solutions, click here to contact our team.
1 https://www.mfaa.com.au/news/mortgage-broker-market-share-breaks-records-again
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