In yet another case of lenders jumping the fence to join the ranks of mortgage brokers, former New Zealand manager for Australian wholesale lender Interstar Raoul Collings and local lending manager Joyti Singh are branching out to form a new broking firm, Mortgage Providers NZ.
Collings says there's "a huge growth opportunity," in broking. Currently brokers in New Zealand account for about 28% of the market while in Australia and the United States brokers account for about 40% and 82% of the market respectively.
Collings says his firm won’t be trying to be "all things to all borrowers."
Instead, they will target particular niches, including the self-employed.
Interstar was one of the pioneers in that segment of the market, like its competitors, providing loans with housing as security based on only declarations of income rather than the full financial statements the mainsteam banks demand.
That doesn’t mean the new company will be trying to be a lender of last resort facility. "We don’t want to present rubbish. If it’s rubbish, we will just flick it," Collings says.
So far, the fledgling company is accredited to Interstar, Liberty, Bluestone, ASB Bank and HSBC.
With their experience on the lending side, Collings hopes he and Singh can set a new standard in broking of providing banks with complete deals without any missing pieces.
Although they have chosen to go it alone in the meantime, Collings acknowledges the future of mortgage broking lies in aggregation. "Banks and lending institutions don’t want to be dealing with 300 or 400 brokers individually."
Once the pair get themselves established, six to nine months down the track, they will be wanting to talk with "like-minded people" with a view to forming a completely new grouping in what Collings describes as "working the model differently."
