Broker. October 2019

October 2019

2019 FBAA National Industry Conference, Gala Dinner & Awards of Supremacy

Magazine

MARTIN GRUNSTEIN

THE IDIOT THEORY OF LIFE – AND BUSINESS

GET YOUR HEAD IN THE GAME!

Niik Stewart

on how to improve your sales game, achieve your goals and create the career and life you want.

IS NOW A GOOD TIME TO INVEST IN PROPERTY? • DIVERSIFYING YOUR MORTGAGE BROKER BUSINESS

LE INSTANT LOAN ASSESSMENT

Australia’s fastest and most sophisticated platform for business finance brokers.

BE M BROKERS RETAIN FULL CONTROL

AP SAME DAY COMMISSIONS ARTIFICIAL INTELLIGENCE

Lend Capital Pty Ltd ABN 12 612 877 442

ACCESS ENDSCORE™

EST LENDER MATCHING SAVE TIME

ALL-IN-ONE LENDING PLATFORM

SINGLE PPLICATION FACILITY

Register to become a Lend Partner today Gain access to tools and technology, such as LendScore™

partners.lend.com.au

CONTENTS

4

06 08 14

From the chair

18 24 28 30 32 34

Lender news

48

GET YOUR HEAD IN THE GAME

With Tony Carter

INDUSTRY UPDATE Moving onwards & upwards

AGGREGATOR NEWS Should you diversify into asset finance broking?

SME lending 101

NATIONAL INDUSTRY CONFERENCE Challenge the Future

Gala dinner & awards of supremacy Back to the 80s

The Idiot theory of life - and business

By Martin Grunstein

The mental health discussion With Peter White AM

Brokers are at the frontline of the industry

By Lyall Mercer

With Niik Stewart

Broker Magazine

44

IS T IN

24

THE COUNT DOWN IS ON! 2019 FBAA National Industry Conference

S NOW A GOOD TIME TO INVEST N PROPERTY?

EDITOR & HEAD OF CONTENT Peter White AM MANAGING EDITOR Krystal Camilleri STAFF WRITER Rachel Licciardello CREATIVE DESIGN & PHOTOGRAPHY Jodi Hadcroft Jessica Camilleri Matthew Gianoulis Krystal Camilleri ADVERTISING Krystal Camilleri TELL US WHAT YOU THINK We appreciate hearing from readers. If you have feedback, news or have a story idea you would like us to cover, please contact us using the below details NEWS, ADVERTISING AND ADMINISTRATION e: editor@fbaa.com.au p: 07 4721 1174 w: www.fbaa.com.au All information and images are subject to copyright. No part of this publication may be reproduced without prior permission in writing to the Finance Brokers Association of Australia Limited. The views and opinions of the authors and advertisers do not necessarily reflect the opinions of the publisher.

While every effort has been made to ensure the accuracy of information at the time of publishing, the publisher accepts no responsibility or liability for errors, omissions or subsequent consequences including loss or damage from reliance on information in this publication.

Broker Magazine

5

FROM The Chair - Tony Carter

H

ow time flies... Here we are in October and it seems only yesterday we were stressing over the outcomes of the Royal Commission and Federal Election. Today there is a clear path ahead and reports of a lifting market from several informed sources. Aggregators are seeing an increase in applications and settlements with some predicting a strong November/December outcome.

Real Estate data is showing a lift in major eastern states’ housing demand. Hopefully you are working on the one-percenter items that make your business thrive.

In the background, FBAA is part of the conversation with legislators and regulators on how they plan to implement the findings of the Royal Commission. One thing is abundantly clear; there will be changes to how the industry operates.

The best we can do is ensure common sense prevails and changes are created that enable the industry to deliver great outcomes for their clients.

One thing will never change and that is; Brokers work for their clients to give them choice that helps them achieve their goals faster and quicker.

Brokers will always provide multiple choice where banks only ever offer their own product range.

The prediction is Brokers will write 70% of the home mortgages within the next 3–5 years with likelihood of higher in longer term.

The recent FBAA EGM resulted in changes to our constitution. The major changes are designed to deliver a progressive Board that is more flexible and consistently refreshed through restriction on total term directors can serve. This ensures FBAA Brokers have the best and most proactive representation in the years ahead.

We recently completed the first Annual Members Satisfaction Survey and received some great suggestions, many we will explore further. The Satisfaction Score achieved 89.6, indicating FBAA is on track to achieve at the highest levels for its members. This year we are chasing 95. You would not expect anything less, I am sure.

At the AGM in November we will produce our first Annual Report. This will ensure you have the full picture of the outcomes FBAA achieves for its members as well as full transparency on the financial position.

One of the biggest achievements this year has been the introduction of the new FBAA Membership App. It is found on our website and is designed to process your membership application or renewal in real time, and in record time. No more waiting to get started as a Broker. It is an industry first and was developed by FBAA from the ground up to meet the needs of our industry.

Finally, I can’t let you go without mentioning the Annual FBAA National Conference. This year there is lots to discuss and it is pleasing to see the advance numbers are up in both sponsors and delegates. It will be a great day of learning and a massive night at the Gala Dinner and Awards Presentation. Do not miss this one.

Thank you for your continued support of FBAA. The team at FBAA can only achieve the association’s goals with your full support.

Tony Carter Chairman

6

Broker Magazine

FBAA Broker Full Page Ad – 210x297 – Unsecured Loan

Hassle-free short term loans up to $250,000 Simple process, no hidden surprises Our Short Term Loan gives your small business clients fast, fuss-free finance from $10,000 to $250,000 with no hidden fees, charges or security caveats. We take a personal guarantee, but there’s no security anchored against personal or business assets.

For more information or to join our Broker Partner Program: Visit www.ondeck.com.au/fbaa Email broker@ondeck.com.au Call 1800 831 294

Broker Magazine

7

After a turbulent year, FBAA Managing Director Peter White says we need to shift our focus, refresh our perspectives and push the industry, and our businesses, forward.

8

Broker Magazine

INDUSTRY UPDATE

Moving onwards and upwards

Broker Magazine

9

INDUSTRY UPDATE

Moving onwards and upwar 3) How we believe the discussion around Best Interest Duty will resolve. The pieces we are still working on include Best Interest Duty, Regulatory Alignment Work, and Codes Of Conduct.

BEST INTEREST DUTY

I

t may feel like our battles have been fought and won, and to an extent they have, but there is still plenty on the table for mortgage and finance brokers. Now is the time to grow your business, to engage with the FBAA and to contribute to a healthy, upstanding industry.

With all that we’ve been through as an industry over the past 12 months, I can say with pride that we have fought three pretty strong battles and won them all. We had the Federal Election in May 2019, which we believed would significantly impact the mortgage broking sector; we had the Royal Commission which became a major item for our industry; and during August/ September we dealt with the Financial Abuse Declarations.

We achieved significant change on all three, which I believe is due in part to the FBAA’s strategic response to each.

10

Broker Magazine

Our industry has been burdened with a heavy weight on its shoulders, which is why we now need to shift that weight and push forward. Onwards and upwards.

The FBAA’s position around the Best Interest Duty discussion is that we do have a concern the penalty for breaching the Best Interest Duty is excessive.

It’s currently a $1.05 million fine – which is 5,000 penalty units at $210 each – and we feel that should be significantly less. Under the NCCP, the maximum breach penalty is 2,000 units, which is about $400,000. That makes the Best Interest Duty breach penalty more than double the NCCP maximum. We are looking to debate this, and work towards achieving a more reasonable penalty.

ENGAGING WITH FBAA Our focus since the election has been to continue to engage with members and industry at large, beyond our memberships and aggregator groups. Personally, I have been travelling the country to meet with many of you at FBAA events and answer your questions in person. In total, I estimate I was part of at least 1,000 broker conversations, in August/September alone.

The main questions you asked were around: 1) The future of commissions, especially trail commissions; 2) The Liberal Government’s Three Year Review in 2022, and what we expect will come from that; and

“I estimate I was part of at least 1,000 broker conversations, in August/September alone.”

rds IMBF The International Mortgage Brokers Federation (IMBF) continues moving from strength to strength. The Federation – Australia, Canada, USA and UK – have been meeting via video conference every month. Our discussions have covered various topics, including the existing Codes Of Ethics in different segments of the market. In exciting news, we are looking to deliver a world-first Global Digital IMBF Conference in 2020. Obviously, the logistics in delivering this are challenging, but we are working through these.

Eventually, we hope to deliver a face-to-face conference. As FBAA members, you will be one of the first groups to be notified of updates regarding the digital conference.

Regarding the expansion and strengthening of the IMBF, I am in conversation with the Netherlands, Germany and Ireland and I expect at least the Netherlands and Ireland to join the Federation the year. I hope to see Germany become part of the Federation next year, but we are in early talks at this point. My aim is to have 10 countries in the IMBF

by the end of 2020, and we will be, unquestionably, leading the conversation for our industry.

FBAA MEMBER MILESTONES There is nothing like riding a rollercoaster to make you appreciate the people who sit alongside you for the ride.

We are currently developing a service recognition program to acknowledge members who have been part of the FBAA for a significant period of time.

More on that to come in future updates.

Peter White AM Managing Director

Commercial Loans NO ONGOING FEES OR CHARGES

Growth - Strength - Integrity

Mortgage Origination Pty Ltd

Lease Doc Loans from 4.09%

Full Doc Loans from 4.09%

Add 0.10% for interest only loans

Commercial 65% LVR • Industrial 55% LVR Specialised Security 50% LVR • Residential 65% LVR www.mopl.net.au

credit@mopl.net.au

0418 439 912 Broker Magazine

11

Strive Financial launches into the Australian market This year, Strive Financial launches into the Australian market. Strive Financial will offer Australian small businesses with personalised lending solutions and will bring together the bridging business finance of Crown and Gleeson Business Finance, with the medium-term loans of Australian Mortgage Fund into a one-stop shop for Australian small businesses.

Strive Financial credits their ability to turn around loans from application to funding within 24 hours by streamlining the legal process through their own law firm, Strive Law, headed by Kasey Lee. Kasey’s blend of experience and qualification helps expedite the loan process for clients and provides a unique point of difference.

The move enables brokers and clients to work together with a single point of contact to find the right solution, whatever their needs. Strive Financial Director Jonathan Lee believes this will create an even better experience for their clients. “For many small businesses, the delays and hurdles of going through the big banks mean it simply isn’t an option.

Being small and agile allows Strive Financial to help clients and brokers find the right solution in as little as 24 hours.”

About Strive: Strive Financial provides lending solutions to Australian small businesses. Specialising in rapid approval short term loans and medium term finance, for over 15 years the directors of Strive Financial have been helping Australian businesses seize the moment or save the day. Visit www.strive.financial for more information, or phone Jonathan Lee on 1300 478 748.

“Being small and agile allows Strive Financial to help clients and brokers find the right solution in as little as 24 hours.”

12

Broker Magazine

Talk to your BDM or visit businesspartners.suncorp.com.au to find out more.

Broker Magazine

13

Is diversifying your mortgage broker business to offer asset finance products a smart move?

And is it as easy as it seems?

College Capital Australia’s Director Neil McKay takes us through what’s involved.

14

Broker Magazine

Aggregator news

Should you diversify into asset finance broking?

Broker Magazine

15

AGGREGATOR NEWS

Should you diversify into asset f M

ortgage Brokers can diversify to offer their clients Asset Finance products, but is it as easy as it seems?

Following recent changes to the broking industry and the outcomes of the Hayne Royal Commission, much has been written about mortgage brokers transitioning to selling asset finance products, with a view to not only build their customer base but to also increase and diversify their revenue.

While as an aggregator College Capital Australia welcomes new participants to the asset finance industry, this transition is not as simple as it may seem.

The asset finance industry consists of the motor vehicle sector and many other specialised assets.

In fact, based on our 2019 volume, motor vehicles make up approximately 50% of the asset volume written. Most of these transactions are funded via the banks’ processing platforms which streamline the application process for the broker. For a mortgage broker, these systems will be quite familiar and user friendly.

The remaining asset finance volume written consists of specialised assets across a broad industry base including, but not limited to, transportation, civil construction, mining and manufacturing. In more recent years, the assets funded have expanded to include solar panels, LED lighting and even software.

“

Some commercial broking firms prefer to specialise in asset classes, building extensive client bases in those industries with a deep knowledge of the assets funded.

Some commercial broking firms prefer to specialise in asset classes, building extensive client bases in those industries with a deep knowledge of the assets funded. This has been established over many years by developing relationships with suppliers of equipment and industry experts. Some brokers prefer to take a different approach with diversity across asset classes and introducing additional products to meet their clients’ entire financing requirements.

Imperative to the broker is to be knowledgeable about the customer, their industry and the asset type.

The banks or asset financiers expect their accredited brokers to have this knowledge and be able to share this

16

Broker Magazine

through the application process.

Financiers will make, as part of the decision-making process, an assessment of the asset and its value throughout the term of the contract and at end of term. This is important particularly when establishing a residual position or balloon payment at end of term.

”

On many occasions, the asset finance broker will be presented with difficult company structures including various types of trusts.

Understanding the structure and the flow of funds through those entities is required at time of application to assist the financier to understand the borrower’s ability to service the proposed commitment and make decisions on what guarantees should be taken to support the transaction.

The broker must balance this with the expectations of the client on security offered to the financier.

Decisions then need to be made on the most appropriate financier for the transaction who will provide the right facility at a competitive interest rate. All of this done with the best interests of the customer in mind.

Another consideration for brokers entering the asset finance industry is remuneration. A component of

finance broking? the remuneration to a commercial asset finance broker is paid through volume bonus incentive plans, in most cases via the aggregator. The question needs to be asked: ‘Does the broker’s current mortgage aggregation

company have financiers accredited to fund the transactions to be introduced and what are the volume bonuses paid?’

proposes to deal with, their success will be determined by the desire to invest time and effort to develop the knowledge required.

So, depending on the types of assets and customers a broker

Neil McKay Director College Capital Australia

Broker Magazine

17

SME Lending 101

LENDER NEWS

Does your broking business offer commercial loans? Why is commercial an important segment for brokers to tap into? Pepper Money’s Head of Commercial, Malcom Withers offer his top tip to brokers working with SMEs.

18

Broker Magazine

Broker Magazine

19

LENDER NEWS

SME Lending 101

M

alcolm Withers, Head of Commercial at Pepper Money shares his thoughts on SME lending and introduces Pepper Money’s latest venture, commercial loans.

Why is commercial an important segment for brokers to tap into?

Small and medium businesses (SMEs) make up 97% of Australian businesses and employ around 4.7 million people. This group is rapidly growing, and it is predicted that in the next 12 months 250,000 new small businesses will open their doors – an 8% growth compared to the last 12 months. They are nimble and dynamic, and can move quickly to gain efficiencies or accelerate growth through different business stages. But they can also struggle to obtain access to capital to support their changing needs. While we have

20

Broker Magazine

“

…

in the next 12 months 250,000 new small businesses will open their doors.

seen growth in lenders in the SME space, we are also seeing traditional bank lenders become more restrictive in their approach to credit and slower in handling applications due to the recent regulatory reviews. Brokers play a vital role in helping these businesses manage cashflow in growth periods, manage asset and equipment needs, along with their property requirements.

What is your top tip for brokers when working with sme customers?

I would recommend really understanding the customer and their business – what drives their business and what makes them successful. In too many cases, a

”

broker will know what the client needs by way of finance but not actually understand how it will impact their business if they do not achieve it. Without this understanding, many brokers will dismiss specialist lenders as too expensive when in fact this is not necessarily the case. With a change in mindset, comes an enormous pay off and opportunity to grow both the broker business and those of their business clients.

Common reasons why sme borrowers go to pepper money.

I’m pleased to report that brokers are embracing Pepper’s commercial solutions for their SME clients as it extends the

breadth of their loan offerings and generates new revenue streams. It is our holistic view of a client, along with flexibility and agility that sets Pepper apart. In developing our new commercial business, we wanted to ensure our products and policies deliver what clients and brokers are asking for:

a unique set of solutions to meet their all their needs and a lender who can deliver these in a flexible and simple way.

We are also working hard to ensure brokers and their clients receive strong support and high service levels that have

become Pepper’s trademark.

We understand the emotional rollercoaster ride that many borrowers face while seeking property loans, and we do our best to make things as simple and stress-free as possible.

Malcolm Withers Head of Commercial

Broker Magazine

21

Easing Pain Points for Aussie SMEs

By Nathan Wright CEO & Co-Founder of Funda The numbers are in and they confirm what some in the industry are already capitalising on – Australian SMEs’ access to suitable finance solutions are still a pain point for millions of businesses.

According to new Sensis data collated in August from more than 1000 interviews with small to medium business owners, 30% of SMEs (with that number jumping to 37% in rural areas) believe access to finance has got harder in the last six months, while 56% believe it has remained the same, and only 14% believe it has got easier. The research also confirms that a quarter of businesses are using credit cards to access finance, and more than one in five are increasing overdraft facilities.

What does this mean for finance professionals?

Australia’s small and medium businesses have an appetite for business finance, however getting their

A Better Solution For Your Clients Our loans give businesses an interest rate that is considerably lower than what some other non-bank lenders offer. We provide market leading loan terms of up to 5 years.

But not only that, we do not penalise our customers repaying their loans early.

Giving business owners the freedom to ensure our financial solutions are working in their best interest.

hands on suitable funding solutions in a timely and cost effective manner can be elusive. As a broker you must be equally frustrated when your wine retailer client needs fast access to capital in order to benefit from a wholesaler’s bulk stock order deal, or when your successful butcher client has difficultly securing finance through a traditional bank to enable his expansion into a new location.

That’s where Funda come in.

Funda Finance is a national non-bank lender on a mission to help small business owners reach their potential. As a solutions-based lender, it is able to provide the benefits of alternative lending such as quick turnaround times, less paperwork and the ability to assess a business’ loan application based on business fundamentals and story, rather than the ridged metrics traditional banks rely on. Funda offers a fair cost of funds, as well as leading loan terms of up to five years.

Seize your opportunity.

Funda is looking to partner with likeminded commercial and mortgage brokers looking for better options for their clients. Funda offers competitive commissions and individual client managers. Find out more at funda.com.au/partnerships

Fast & Fair Business loans Helping Australian businesses reach their potential $5,000 - $250, 000 business loans.

Lightning application process for loans under $20,000.

Revolving line of credit option.

Secured and unsecured options.

Assessment within 24 business hours.

We value our Referral Partners Commissions paid on settlement, a dedicated client service manager and lifetime customer status, are just some of the ways we take care of our referrers.

Fair Products. Fast Process. Your Finance Partner.

To find out more head to funda.com.au/partnerships

funda.com.au 1300 647 996

22

Broker Magazine

hello@funda.com.au

PROFESSIONAL INDEMNITY INSURANCE

YOU MAY BE INSURED, BUT ARE YOU COVERED? As every Finance Broker knows, Professional Indemnity (PI) Insurance is an essential part of doing professional business in todays world.

However, most PI policies on the market are generic in nature, ie they are structured to cater for most professional occupations - not so with Finance Brokers PI Plus!

Our exclusive policy has been specifically designed & continually upgraded over the years to meet the particular & unique needs of the Finance & Mortgage Broking industry - indeed, we have been the appointed Insurance Brokers to the Finance Brokers Association of Australia (FBAA) Since 2000.

EXPERIENCE THE INSURANCE ADVISERNET AUSTRALIA DIFFERENCE Policy meets, & in most cases exceeds, all ASIC National Licencing requirements.

NIL EXCESS applies on claims lodged via AFCA. Easy on-line application process – takes minutes to complete.

Personalised service, including all claims handling disputes.

Pay by month option available.

Premiums start from a very low $650 (plus Gov’t charges & fees) for a $2M limit of cover.

Contact us for your no obligation assessment today.

1300 769 163 dloades@iaa.net.au www.insuranceadviser.net/drloades

Darren Loades is an Authorised Representative of Insurance Advisernet Australia Pty Ltd, No: 262182 AFSL No. 240549

Broker Magazine

23

IT’S TIME! 24

Broker Magazine

As we look to Challenge the Future during the 2019 National Industry Conference, our annual Gala Dinner and Awards of Supremacy will be throwing back to the bright colours and big hair of the ‘80s!

Broker Magazine

25

NATIONAL INDUSTRY CONFERENCE

He’s a wise man that Slim Dusty: “Looking forward, looking back, I’ve come a long way down the track.

Got a long way left to go…” Those lyrics sum up the FBAA’s two signature events this year, both themed around time – the future and the past.

Time and health are key to everything we do, both in business and in life. Following a tumultuous year, it’s time for you to refocus.

The 2019 National Industry Conference is themed Challenge the Future, and is the inspiration you need to plan the future you want, to grow your business, to equip you with the motivation, tools and tips to really push you to the next level.

Featured on this edition’s cover is the event MC, Niik Stewart. His enthusiasm and straight-shooting way of stating the truth is just the energy we need for this year’s conference.

“It’s not easy to keep your own energy levels going high all day, let alone, keeping a crowd in the same manner,” says FBAA Managing Director Peter White.

“I think Niik is one of the individuals that has that ability. He’s a very motivating guy, with high energy and great insights.”

Other speakers include marketing guru Carolyn Miller, economist Stephen Koukoulas, futurist Steve Tighe, mental health speaker Anthony Hart, and ASIC.

26

Broker Magazine

SPEAKER LINEUP MC Niik Stewart

Mental Health Anthony Hart

Niik Stewart is well considered by most in the industry to be the #1 success mentor for mortgage and finance brokers in the world. In the area of personal and professional development, high-performance and income-increasing strategies for salespeople Niik is unmatched.

Three million Australians are living with anxiety or depression. In the workplace, one in five employees will take time off due to mental healthrelated illness, costing Australian business approximately $10.9 billion per year; and this doesn’t factor in any loss in productivity while at work.

With a career spanning over 17 years of speaking to, coaching and training mortgage and finance brokers, no one has as many testimonials from assisting and helping mortgage brokers to achieve their true earning potential and “next level” of success that Niik does.

Anthony Hart is a passionate social entrepreneur, an advocate for mental health and a man on a mission to shift the narrative around mental health in Australia. At the heart of his message ‘Mates who wear Masks’ is a desire to empower others with simple tools to inspire, activate better conversations, connections and to build positive communities designed to remove the many masks of mental health.

Niik will be leading the way to help you challenge your future.

Futurist Steve Tighe Steve is renowned for his clever use of metaphors, images and case studies. He will take his audience at the 2019 conference on a virtual journey into the future, alerting us to the drivers of future change and the implications for our businesses.

A practising futurist, Steve is the former Foresight Manager at Foster’s and has worked with some of Australia’s leading companies, looking at the future of their industries and the strategic opportunities for their businesses.

Marketing Carolyn Miller For over 20 years Carolyn Miller has been working in the marketing and advertising industry and has been a strategist at multiple award-winning agencies. She’s also a regular panellist on the highly popular ABC television program Gruen, where advertising industry experts review and discuss marketing creative concepts and strategies.

Carolyn has featured as a contributor in the best-selling book, The Gruen Transfer, and is regularly featured in a variety of television shows discussing advertising, including Sunrise on Channel 7 and The Today Show on Channel 9.

Economist Stephen Koukoulas Stephen is the go-to economist for many businesses, investors, fund managers and the media. His views and analysis are presented without fear or favour, making him a much sought-after speaker.

As a speaker Stephen has been called upon to discuss the economy with diverse audiences, from the corporate world to school students. This is an affirmation of his ability to turn complex economic analysis into terms mere mortals can understand.

At the 2019 conference, Stephen will deliver a detailed economic report on the next 12 months and see if we really are challenging the future.

ASIC In what has become an industry stand-out session, hear directly from our industry regulator on the matters that have affected the financial services sector in 2019.

ASIC’s front-line team will be there to deliver the 2019 review and what is ahead for 2020, and answer any questions conference attendees may have regarding the changes that are coming in to effect.

This is one of the only industry opportunities to hear it straight from the regulator and, if time permits, have your questions answered directly.

Broker Magazine

27

GALA DINNER & AWARDS OF SUPREMACY

As for the evening events – the Gala Dinner & Awards of Supremacy – the night will be one of colour, crimped hair and your favourite ‘80s music.

The 2019 FBAA National Industry Conference, Gala Dinner and Awards of Supremacy will be held Friday, 8th of November at Sea World Conference Centre on the Gold Coast.

“It’ll be a blast from the past,” says Peter. “We want you to show us your best ‘80s fashion, your neons, your favourite ‘80s pop star or movie character tributes. This is a night to relax, have fun and shed a bit of that stress from the last 12 months.”

For details and to arrange tickets, go to

DON’T MISS the finance industry FRIDAY 8TH NOVEMBER | SEA World, Gold Coast Limited TICKETS Available!

GET TICKETS NOW

28

Broker Magazine

2019

fbaaconferences.com.au

4 Good reasons to consider a trainee If you only knew that hiring a trainee could be beneficial to your business!

KNOWLEDGE NOVICE ECONOMICAL WILLINGNESS

Millennials may bring a myriad of new skills to your business, including technical skills, use of social media and mediums to engage the community.

Coach your trainee to meet your business needs.

Trainees can often commence at a lower salary than those with more experience.

Learn and develop new skills in an industry which has so much potential to build a long term career.

Based on the Federal Australian Apprenticeships Incentives Programme, employers may receive up to $4,000 in funding. Further incentives may be available for regional businesses and school-based apprentices.

For a limited time, AAMC Training are offering traineeships for FNS40815 Certificate IV in Finance and Mortgage Broking or BSB30115 Certificate III in Business for $1,500 including the traineeship administration fee. *Price quoted is only available in some metropolitan locations, additional fees may apply in some locations and states.

Contact us today to find out more on 03 9391 3643 or email info@aamctraining.edu.au.

RTO 51428 Unit 1, 421 Blackshaws Road, Altona North, Victoria 3025

+ 61 3 9391 364 www.aamctraining.edu.au info@aamctraining.edu.au

Broker Magazine

29

THE IDIOT THEORY OF LIFE – AND BUSINESS Martin Grunstein

is an in-demand speaker on Outstanding Customer Service, having delivered outstanding results with over 500 Australasian companies. For more info, visit martingrunstein.com.au

Everybody has his or her own theory of life. Mine is called the “idiot theory of life” and it has become the central focus for all of my teachings in customer service. It goes like this.

When you are about 12 or 13 (but at different ages for different people) you are sitting in your bedroom one day and it dawns on you – that you’re an idiot! This probably happens as a result of making a goose of yourself with the opposite sex and you think to yourself, “boy, am I an idiot? I hope nobody’s noticed.”

It becomes your mission as a teenager to hide the fact that you know you’re an idiot from everyone else. You dress like the crowd, you act like the crowd and it’s risky to ask the opposite sex out for fear of rejection; that’s how we live our adolescent years.

But, you never grow out of it! As adults, it intensifies and it becomes your mission in life to hide the fact that you know you’re an idiot, forever.

30

Broker Magazine

Eventually, you meet one person in the world who you fool completely, so you marry that person! You meet another group of people who know you’re an idiot and accept you.

We call these people friends. There’s a the third group of who know you’re an idiot, but they don’t let you know that they know you’re an idiot. And these are the people to whom we give our money in business! And I mean that most sincerely.

For example, I had to buy a computer for my business. Now, I am an idiot when it comes to IT, so I try to hide the fact that I’m an idiot from the person serving me by saying all the things you are meant to say when buying a computer (even though I don’t know what I’m talking about). Two seconds after I open my mouth the salesperson knows I’m an idiot from the way I speak but if that person lets me know that they know I’m an idiot, I’ll run a mile because we don’t give our money in business to people who humiliate us in the sales process.

Most of your clients know very little about mortgage broking or financial services in general. They just need a home loan.

One of the main reasons the mortgage broking industry exists is that home loan customers were frustrated by the bank’s systems and the bank lender’s lack of customer service skills.

The best brokers don’t just provide the best loan recommendation, they do it in a way that makes the whole experience stress free.

They answer questions, return phone calls, they are on time for meetings with clients, they meet deadlines. If a client doesn’t understand something, they explain things in a way that doesn’t humiliate them. In general, they provide a good service experience and they never let the client feel that he/she is an idiot.

I really believe the success of the broking industry has been less to do with offering the cheapest home loan rate and more to do with independent brokers caring about their clients and providing a good experience in organising their home loan. In the wake of

the banking Royal Commission the bar has never been lower when it comes to providing a better service experience than the banks. I believe brokers should be talking about this much more when selling their services.

There is an adage in customer service that says the customer is always right. It’s the greatest load of garbage I’ve ever heard!

The customer is wrong almost 100% of the time. In fact, sometimes the customer is an idiot, just like you and me. But whether the customer is right or wrong is irrelevant to the success of your business.

“There is an adage in customer service that says the customer is always right.

It’s the greatest load of garbage I’ve ever heard!”

The only thing that matters is whether the customer walks away from dealing with you thinking he/she is right or at least not being humiliated in the process when you need to correct them. If you can get that into the way you do business and get it across to your staff there is a good chance you will increase the number of your repeat and referral clients.

Broker Magazine

31

With the topic of mental health still front of mind for the FBAA, Peter White recently joined the James Veigli and Ash Playsted from The 10X Broker for a mental health discussion. This video is available for you to view for free.

One in five people are suffering from mental health illness at this very moment. Issues like depression and anxiety are most common; and the broking industry is far from being immune.

In 2016, the FBAA initiated the conversation to the broking industry around mental health.

“The FBAA’s mental health initiative is growing in leaps and bounds,” says Peter White, FBAA’s

32

Broker Magazine

Managing Director. “Suncorp has recently joined our mental health initiative as a major sponsor, and we continue on an even bigger mental health journey as we go through 2019 and into 2020.”

Recently, Peter joined The 10X Broker’s James Veigli and Ash Playsted for The Mental Health Discussion, as part of The 10X Masterclass Sessions. These sessions are usually reserved for 10X Broker members, however, given the importance of this topic, James has made this video available for you to view at no cost.

To watch The Mental Health Discussion, play this video or visit the10xbroker.com.

It’s also reported2 the average overall cost of cancer to a household is an estimated

$48k

Broker Magazine

33

EDITORIAL

BROKERS ARE AT THE PR front line FOR THE INDUSTRY

By Lyall Mercer Managing Director

The term ‘public relations’ (PR) is widely misunderstood, and terms like ‘spin’ misrepresent its importance to every company and industry. Put simply, PR means to have a relationship with your ‘publics’ (a PR term for stakeholders). In that sense all businesses do public relations – some just do it better than others.

A successful relationship with your publics is built on a foundation of trust. Trust is the key to any relationship, be it personal or business. A relationship of trust with your stakeholders – clients, potential clients, employees, regulators, lenders, aggregators and others – is vital because people deal with and recommend those they trust.It is clear the finance broking sector, despite some negative commentary, enjoys a high level of trust with consumers. This is why over 60% of mortgages are now settled through

34

Broker Magazine

brokers. When the industry was the focus of illinformed comments and recommendations from the banking Royal Commission, MPs reacted quickly to the intense lobbying from groups including the FBAA, because they believed what they were hearing. If the industry wasn’t trusted, these voices would have fallen on deaf ears.

Trust isn’t built overnight, but it is fickle and can be eroded quickly. Once lost it can take a long time to regain. The taxi industry was crippled by the rise of rideshare despite rideshare at first being illegal and offering almost zero safety measures, because people just didn’t trust taxis. Theme parks lost revenue following the Dreamworld tragedy because trust was broken in the aftermath. Federal Labor lost the “unlosable” election because voters didn’t trust their policies or promises enough to elect them.

Consumers’ trust in finance brokers can be broken if they started to believe the negative messages from a minority of opponents, often driven by selfinterest. This is why the FBAA is active in the public domain and works hard to counter these inaccurate messages with informed commentary.

Finance brokers also have a very important PR role to play, because trust can be broken by their actions.

One instance of unethical or criminal behaviour by a broker can affect the entire industry. One act of

These days we live in a strange media world, where outrage and offence are everyday occurrences. My advice to brokers is to manage your social media carefully, promoting positive messages but equally always considering the ramifications and possible unintended consequences of what you post.

Avoid making comments that divide or alienate because your clients come from all walks of life.

Present yourself as the expert, providing advice freely and offering information that reinforces your specific expertise.

Talk up the industry because your success and the trust in the sector as a whole are linked.

‘‘

TRUST ISN’T BUILT OVERNIGHT, BUT IT IS FICKLE AND CAN BE ERODED QUICKLY.

If you can’t manage your social media effectively, engage an expert who can look into what you are doing from the outside, and see both opportunities and risks that you may not notice.

‘‘

poor customer service shared widely on social media can diminish trust. One wrong marketing campaign or comment can cause outrage.

Finance brokers are the PR front line for the industry. If what the FBAA says on a national level is not being backed up by members at the local level, trust is damaged. Conversely, when brokers provide excellent customer service, produce great results for clients and manage their marketing and social media presence in a way that promotes the industry positively, it enhances the sector and builds trust.

Overall, let your actions back up your words, and do business with integrity, honesty, transparency and morality. When others trust you, they will talk about you and that’s when you know you have excelled in public relations.

Broker Magazine

35

Broking that’s safer than houses.

prospa.com/partners

✓ ✓ ✓ ✓ ✓ ✓

OVER

SPEAK TO THE DECISION MAKERS

36

Broker Magazine

FUNDING AUSTRALIAN BUSINESSES

OVER

$100M FUNDED LOANS

24 AVERAGE TIME TO FUND A LOAN

EDITORIAL

Is Motivation Destroying our Identity?

A

n outstanding life is not about littering your day with lifehacks hoping for that magical transformation to your health, relationships and bank account. Transformation is such a misused word that has somehow become synonymous with ‘instant’. The reality is that it takes much longer than that. It’s a process of becoming who you want to be rather than what you want to achieve. This principle not only applies to you as an individual, it also applies to businesses, families, and sports teams.

You will notice that the most outstanding and pioneering companies are not focused on outcomes such as optimal PE ratios or dividend yields; that’s what mediocre companies focus on. Outstanding companies are instead focused on what they stand for, their values and the impact they want to make on the world. Wharton Business School studied these companies and called them “Firms of Endearment”. These were businesses focused on purpose before profit. But what the team at Wharton discovered, stunned everyone. These same companies financially outperformed the S & P 500 by a ratio of 9:1 over a 10-year period. They, ironically, made the most profit!

This is the way we should live. It is “goal-less” thinking. It is about who we want to become as a process of daily refinement where there is no finish line. It is about taking daily action and following a system for conscious living without any attachment to the outcome. And letting the results take care of themselves, slowly over time.

This is certainly how I live in my eight areas of life.

For example, when it comes to health, I don’t have goals that sound like this: “I want six-pack abs” or “I want to go to the gym three times a week”. Such outcome-based goals and process-based goals set us up for disappointment. What happens if I don’t get six-pack abs? What if I miss going to the gym? I end up feeling like a failure and blame myself for not having (wait for the big M word) – motivation!

By Sam Makhoul Broker Magazine

37

EDITORIAL

FOCUS ON BECOMING WHO WE WANT TO BECOME, THEN WE NEVER GIVE UP BECAUSE “IF WETHERE IS NO DEADLINE AND NO FIXED OUTCOME; WE ARE A WORK-IN-PROGRESS.” Our addiction to motivation is one of the reasons why there are so many anxiety disorders in our society. Anxiety lives in the gap of where we are in our lives right now versus where we want to be.

We have a restless desire to achieve but no system for achieving. Then we start comparing ourselves to ‘successful’ people who have great lives, great businesses (and great six-packs) and say, “they must have more motivation, more money, more luck, more opportunity,” etc. when, in fact, they just have better systems for living. This helpless way of thinking makes us ‘give-up’ and slip back into a default state of mediocrity where we wake and live by old habits, slowly drifting in the direction of our greatest weaknesses; whether that is mindlessly scrolling social media, eating too much, procrastinating, binging on TV or blaming and arguing. If we focus on becoming who we want to become, then we never give up because there is no deadline and no fixed outcome; we are a work-inprogress. When we focus on this identity change, we start to naturally focus on systems for living rather than on motivation.

Hope (motivation) without habit (systems) is hopeless.

Hope without habit will also cause an inevitable identity crisis as you drift from one fad to the next in search of an identity that is not really yours. I urge you to start with who you want to become in all eight areas of your life depicted above. This will

38

Broker Magazine

spark the right kind of motivation: Identity-based motivation. Not results-based. This kind of ‘intrinsic’ motivation can be the spark that starts your quest for behavioural change. But to stick it, you need to implement daily systems. It is systems that lead to progress. It is systems you can count on. Bit by bit, day by day, your efforts compound and you reach a tipping point where your life just becomes so much easier. What seems like an overnight success to everybody, really began many months or years before. Just ask any founder of a great business or any athlete what their overnight success looked like. Behind every game is many hours of training. Behind every product launch is a series of workshops with trial, error, research and painstaking review.

I recall that first day in 2008 when I realised that I really wanted to become a runner after ‘attempting’ the Sydney City to Surf. I loved the freedom and the meditative trance of sneakers hitting the pavement.

The next week I started ‘trying’ to run. I woke every morning at the same time and walked a bit, ran a bit, puffed out, slowed down and repeated the process. I didn’t give up because I was not focused on a result and therefore no measure to live up to. I was focused on becoming a ‘runner’ and that relaxed me into a state of patience and perseverance. I committed to the process and surrendered to the outcome. That’s the beauty of asking yourself who you want to become and not what you want to achieve.

My running gaps started getting longer and rest periods shorter. Two years later I ran a halfmarathon in 96 minutes, not that I am bragging about that result. It is just to demonstrate what is achievable when you keep going. The outcome is what it is. What I considered impossible two years earlier became who I am. Now being ‘a runner’ is part of my identity. It is one part of who I am.

When you start a new habit that is congruent with who you are, you are more inclined to stick to it. So, don’t try and be something you are not simply because you saw a celebrity doing it or an Instagram model ‘living it’. Be true to yourself and who you want to become.

For more practical tips on upgrading your life and pivoting during tough times, download Sam Makhoul’s free eBook: GUIDE TO GREATNESS by clicking here.

Character based lending.

Because the solution is in the story.

As one of Australia's leading specialist auto and personal lenders, we focus on your customers' story to find a tailored solution.

. Provide a streamlined and consistent decision process . Confidence in deals submitted for approval through our new, simplified matrix .. Fast settlements process credit scoring or risk fees . NoAttractive commission structures Our commitments to Brokers include:

loanu.com.au

For more information, please contact our National BDM

.

manny.rosales@loanu.com.au 0408 999 789

Broker Magazine

39

Have you overlooked the off-the-plan property markett?

By Zak Wilford

Specialist Recruiter working with Mortgage Brokers

Rising to the challenge is a mindset that seems ever-present in the mortgage broking space. With so many recent challenges faced, it’s good to hear the conversation slowly switching to discuss a more positive future for the industry.

Having recently joined urban.com.au, my experience of the mortgage market has widened as I begin to work closely with property developers and real estate agents in the off-the-plan property market.

This is a market often overlooked by brokers because of delayed settlement times and risk.

However, it’s certainly a market that’s growing, and the sentiment is becoming increasingly positive.

Urban.com.au sees up to 5,000 property enquiries month to month with property seekers categorising themselves into three buckets; first home buyers (37%), investors (30%) and next home buyers (33%).

40

Broker Magazine

When discussing the challenging future and how brokers can embrace this, there are conflicting ideas around capitalising on the off-the-plan market.

Consumer demand to buy off-the-plan is still there, the spread across buyer types is relatively even, and it’s my opinion that brokers can easily demonstrate a lot of value here.

Because of the “high risk” perception, consumers are often seeking reassurance and someone to provide transparency of a process that right now has very little. Brokers can play a role in closing this gap and working with property seekers to ensure they understand the finance side of buying off-the-plan.

Brokers often talk about a customer for life, a longterm relationship that sees repeat business and multiple touchpoints. The benefits are obvious but with this comes a lot of work that, because of how brokers are renumerated, can often be for little reward. The off-the-plan market offers an opportunity for brokers to build long-lasting relationships and set the expectation from day one.

“Brokers can play a role in closing this gap and working with property seekers to ensure they understand the finance side of buying off-the-plan.”

Rather than a quick transactional deal that no doubt everyone loves, this offers an opportunity to begin a relationship that is invested in over some time and allows multiple touchpoints. These should be seen as opportunities for referrals, amongst other things.

To invest in these relationships will undoubtedly pay dividends in the future.

There’s no denying that real success often comes from dominating a niche. Identifying a section of the industry and becoming the go-to expert within that space. Demonstrating credibility and experience fills people with confidence, and, in turn, keeps customers coming back and referring friends.

Stef and Ivan run a booming cafĂŠ and have a dream of owning their commercial property. But limited finance options have put their grind to a halt.

Welcome to real life.

Luckily, they had a great broker who knew all about Pepper Money Commercial, which meant their business goal was about to become real.

Call 1800 737 737 crescenarios@pepper.com.au Pepper Group Ltd ACN 094 317 665 Australian Credit Licence Number 286655 is the servicer of loans

by Pepper Finance Corporation Limited ACN 094 317 647.

The Real Life Alternative

Broker Magazine

41

FBAA APP

The new technology also helps users to manage and monitor industry requirements and user needs all year-round including

This Web App “ makes the process

move faster, because time is money.

The previous membership application process could take anywhere from one week up to two months to complete. That meant brokers could be waiting a significant period of time for the

Broker Magazine

“The development of this Web App impacts the industry as a whole because massive data analytics capabilities actually help us understand our membership composition, member needs and specialisation learnings.

“I’m told that as far as industry associations go, this is a worldfirst. We are currently looking into how we can further use this Web App to support members,” says Peter.

“As always, your feedback and suggestions are encouraged.”

D A PA PPRPORVOEV E D

NEW OR EXISTING MEMBERSHIP?

42

”

“It’s called a ‘Web App’ because you don’t have to download anything, you just have to go to the FBAA website and it’s there,” explains Peter.

d 6n 0 6 0s e c o n o n d sec

“How this Web App makes new and existing members’ lives easier, is that it simplifies and speeds up common processes like membership applications or renewals, credit and bankruptcy checks, insurance and ombudsman requirements as well as education and training,” says FBAA Managing Director Peter White.

“The App triggers key dates in the system, so when it comes time to renew all you do is click ‘yes’ and the system either runs automatic payments or generates payment at the time of acceptance without headaches or clumsy requirements and more forms.”

in a i n l e s s t ha h less t n

In July, FBAA launched its innovative, high-tech Membership App to the world.

tracking protection and indemnity insurance issues and compulsory professional development needs.

s

With the goal of streamlining processes and better managing time and health, the FBAA has revealed its newest creation, an innovative Membership App.

“This Web App makes the process move faster, because time is money. When you work as a broker, time can quite literally mean money – finance for your clients and income for your business.

s

High-tech Membership Web App a world first

required certification they need to complete their accreditation with aggregators and lenders.

Broker Magazine

43

GET YOU HEAD IN THE Game!

He’s a high-energy former pro basketballer turned sales trainer, motivational speaker and life coach who has worked with brokers for almost two decades to help them perform at the top of their game – in both career and life. We caught up with Niik Stewart ahead of November’s 2019 FBAA National Industry Conference, at which Niik will be MC. They say that when it comes to meeting people, you won’t remember everything they say, you may not even remember their name, but you will remember how they made you feel.

Meeting Niik Stewart, the feeling that comes to mind is energised.

During the past 19 years, Niik has worked with mortgage brokers, real estate agents and direct sales professionals, as well as elite athletes, pro sporting teams, Fortune 500 companies and successful individuals like comedian Kevin Hart and musician Sting.

44

Broker Magazine

UR N !

Broker Magazine

45

COVER STORY Despite being a motivational speaker, life coach and sales trainer, Niik’s the first to say that it’s not his intention to motivate his clients or his audiences, because the only person who can motivate you is you. He just talks sense; and he shoots it straight at you.

“We are only what we practice daily – our attitudes, disciplines and habits,” says Niik.

“That is who we are as human beings.”

And that applies not just to your career as a broker, but also to your life at home. Niik says he gets two types of clients; those who are already successful in their careers but their home lives and physical health are out of shape, and those who have great home lives but need to fire up their careers. The solution, says Niik, is the same.

“You change your attitude, you change your mindset. You change your mindset, you change your life. Don’t be looking for your business and your employees to change until you shift your attitude, shift your mindset. Don’t look for your husband/wife/partner to change – it all starts with you.”

Those who attended last year’s FBAA National Industry Conference will remember Niik as the day’s final speaker. This year, he will take the role of event MC. “My role will be to facilitate the energy, the effort and enthusiasm of the people in the audience that day,” says Niik. “There’s a lineup of great speakers to help the people in that room go to the next level. My job is to remind people, that ‘hey, you’ve turned up, so turn on.

Be present. Take it in. You only get out what you put in.”

46

Broker Magazine

This, Niik knows to be true: you only get out what you put in. Growing up in one of the most notorious neighbourhoods in the US – South Central, Los Angeles. “I grew up in a very tough neighbourhood, in a single parent home,” shares Niik. “I tell my story to show that it doesn’t matter where you come from, it matters where you’re going. It matters what your focus is, what your goal is.”

“Successful people do what unsuccessful people don't feel like doing.”

His talent for sales and his understanding that you get out what you put in, became apparent at the age of eight.

“I wanted to buy something, but my mother didn’t have the money,” recalls Niik. “I asked her, ‘how do I get it?’ She said, flippantly, ‘sell something!’ Now, I was eight – I’d never thought of selling anything.

NIIK STEWART

“We lived near a corner, and I must have understood presentation is important because I took one of her nice blankets and put it down on the grass in front of our apartment – it was 40 years ago and I remember like it was yesterday, my first yard sale – and I put my toys out on the blanket. I made $4.48 that day, which, when you’re eight and in a poor neighbourhood, it might as well have been $500.”

That success sparked something inside Niik, who then began buying wholesale lollies from Costco to sell to his friends, which led to a successful side-hustle charging kids in his neighbourhood to play his video games.

At 13 years old, he discovered basketball. In 10th Grade, his mother told up she wouldn’t have the money to send him to college. He knew a scholarship would be the only way to get him there, so he began training six, then seven, days a week.

He got a scholarship for five years of college, valued at $115k.

But that scholarship wasn’t initially offered to him though – he had to go after it. Niik cold called the coach and pitched himself. “The coach thought it was a practical joke because he’d never had an athlete who had called him!” tells Niik, who went on to play professionally in Italy, Asia and Australia.

When his basketball career concluded, Niik returned to his original career – sales. In the almost 20 years since Niik left basketball, he has cemented a career teaching sales and empowerment strategies, bringing his high-energy and positive attitude to everything he does. Here, he shares some tips to help you fire on all pistons.

These, he says, are just common sense.

Broker Magazine

47

NIIK’S TIPS TO IMPROVE YOUR Sales

Game

1. KNOW WHAT YOU’RE SELLING. “Every broker has products and services, and as far as the potential clients are concerned, you're all the same,” says Niik. “People can only buy your personality, they're only buying you, so I say you're selling three things: you're selling yourself, you're selling your company, and then you're selling your products and services. But if they don't buy you, they don't care who you work with and they don't care what you got.”

This is why customer service, relationship building and being comfortable in showing your personality is key.

2.POSITIVITY IS PARAMOUNT. “You have to have an engaging, positive attitude, otherwise, you're pushing away business that you want,” says Niik. “Like attracts like. Energy is everything.

“We train people how to treat us – both in business and our personal lives,” he continues. “After potential customers interact with you, you want them to think, ‘yes, I want to do business with her even though I’ve seen three other brokers, because she’s excited which makes me excited’.

“I've worked with people who are earning $100 million a year, I've worked with Usain Bolt, I've worked with Kobe Bryant, I worked with Sting, I've worked with people at the very top of their profession, and they all have great attitudes. It's the people at the very bottom of business who don't have the best attitudes. So, I always say attitude precedes performance.

“If you start off with positivity, your client knows they are dealing with someone that's proactive and positive, so this process, even if there's challenge, will still be proactive and positive.”

3. SET SPECIFIC GOALS. “Without direction, you’re floundering,” says Niik. “I’d say 90% of people struggle with direction.” Direction isn’t just about goal setting either, it’s also about goal resetting. “When people don’t reset goals, they stagnate, they flounder, and then they kind of lose 48

Broker Magazine

direction, and they become cynical, sceptical and negative.” And that makes success, and happiness for that matter, a whole lot harder to obtain.

“I coach a lot of mortgage and finance brokers, and these are very smart men and women, because they are investing in themselves. Goal setting and resetting is always the starting point, because if you don’t know where you want to get to, anywhere will do. The more specific your goals are, the better the chance you will act on them. If your goals are vague, well, you have a problem.

Another problem is a poor strategy to achieve your set goals. “A goal without an action plan is just a really good idea,” says Niik.

4. TAKE ACTION. EVERY SINGLE DAY. “I believe in positive thinking, but positive thinking without action is the beginning of delusion,” says Niik, who references his earlier mantra of attitudes, disciplines and habits. “Successful people do what unsuccessful people don’t feel like doing.”

This could be making cold calls every morning to generate leads. It could be going to bed each night at 9.30pm and wake at 4.30am to exercise, to give your mind the best shot at good health and productivity through sleep and physical activity. It could be that when you attend a conference, you stay until the end and watch every speaker. Be present in what you are doing. Give it all you’ve got, to get the most out of it. “If you turn up, you have to turn on,” says Niik.

One daily activity Niik promotes is meditation.

“Meditation is just deep breathing for five or 10 minutes; it quiets your nervous system, it calms you down, it refocuses your energy.” The result? “You don’t want to tell people to f*^k off as often.”

5. RE-VISIT YOUR VOICEMAIL. “If you don’t have a positive voicemail message, you’re already losing,” directs Niik. “First impressions are everything, and first impressions are unconscious; 93% of communication is non-verbal.

So, it’s body language, facial expression, and tone of voice which comes through in your voicemail. If people can’t relate to you or they’re not engaged by you, they’re not interested.

“When people see me again after a conference, it might be a month of two or even a year later, and they say, ‘I changed my voicemail message and that was the starting point for my whole business changing’. Why? Small things make a big difference. The big shit is obvious. Small stuff equals big deal.”

To book your ticket/s to the 2019 FBAA National Industry Conference: Challenge the Future, go to fbaa.com.au

Finance for Real Estate Agents Access working capital today If you’d like to:  Service more clients

 P ay off debt

 E xpand your business

 B uy out a business partner

 Purchase another rent roll

rentrollloans.com.au For more information, call us on 1300 222 733

Rent Roll Loans allows you to borrow against the income from you rent roll today, enabling you to fund and grow your business.

No property security or annual reviews are required, just a simple assessment to ascertain your borrowing capacity.

“The product offering was great, suited my business and was low in fees. In fact, as no valuation was required I saved even more money. I could not have asked for a better funding option.

– Jessica Arabia

Broker Magazine

49

Is Now A Good Time To Invest In Property?

50

Broker Magazine

d t

By Grant Bailey Deposit Power For years now, property pundits have been warning of a coming Armageddon in the Australian property market.

In 2004, The Economist magazine described Australia as “America’s ugly sister” with the OECD warning the Australian housing market was more than 50% over valued.

Fast forward to 2019 and we have seen the same sorts of dire predictions in the mainstream press. Headlines like, “Let the bloodbath begin” (1) and, “House prices could fall by half in Sydney and Melbourne” (2). Yet, whilst the market in certain areas has declined on a number of occasions in the past 30 years, it has not ‘crashed’ 40% or 50%.

During its 30 years in Australia, Deposit Power has seen a number of property cycles come and go. Given they issue hundreds of guarantees every month through their aggregator partners, they need to have a good grasp on what is happening in the property market and where it is heading as part of their risk mitigation strategy.

“What we have seen over the past two years is a market correction that happens in all markets from time to time,” says Grant

Bailey, General Manager of Deposit Power.

“Prior to that, for five years we saw property prices in each Sydney and Melbourne grow by around 10% per annum, largely driven by population growth of at least 100,000 new residents in each city, each year. At some point, various market forces impact the current state of play,” he says.

“What makes this downturn unique is that it has been caused solely by a restriction in the availability of credit. This has not only impacted mum and dad investors but also property developers who struggled to get finance for their projects.”

JLL’s Apartment Market Report published in October, 2018, noted that the Melbourne unit pipeline had fallen by one third for the September quarter compared to the same quarter in 2017.

“Whilst there have been predictions over the past few years of an oversupply of property, the reality is that the impact of APRA lending restrictions for investment purposes, has had the effect of limiting this oversupply.

Indeed in recent years, the apartment pipeline of projects approved but not yet built, has contracted over 30% in both Melbourne and Brisbane compared to the 2016 construction pipeline,” Grant continues.

Broker Magazine

51

EDITORIAL However, the tide has now turned following the recent relaxing of credit after the RBA warned of the negative impacts of a tightening in the availability of credit.

If the current property market decline has been caused by a tightening in credit, then it makes sense that its recovery will be greatly assisted by an improvement in the availability of credit. In recent months we have seen ABS housing finance data record an increase in the number of valuations. suggesting lenders have eased credit.

“Now that the market correction is largely behind us and lenders have started to ease borrowing requirements, we will soon see an end to the monthon-month property price declines followed by the market recovering in the second half of 2020,” predicts Grant.

So where is a good place to buy? “Certain areas of Brisbane represent good value relative to Sydney and Melbourne,” says Grant. “When compared to similar stock, there is definitely a significant price gap. Brisbane also has a lot of infrastructure work going on for the next five years or more. However, you need to do your research. My tip is always look

at smaller boutique properties which have a 60% or more owner-occupied mix, that are close to schools, shops and transport.

Historically, the Brisbane market has performed well in the periods post a Sydney growth cycle such as we have seen up until the end of 2017. Relative affordability in the Brisbane market compared to Sydney and Melbourne has usually resulted in an increase in interstate migration to Queensland.

The graph below is based on Australian Bureau of Statistics (ABS) data and tracks the level of interstate migration to Queensland over the period between 1980 and 2018.

Source: Binnari Property

Do you have clients with low credit scores?

Are they struggling to pay high establishment fees or high interest rates?

At Credit Fix Solutions, we offer fast and friendly, no result no fee credit repair services.

Award winning Australianowned business.

Be a hero broker and save your clients thousands in interest and establishment fees.

Our CEO, Victoria Coster, has repaired thousands of reports, and has removed negative listings up to $2,000,000 from a report.

52

Broker Magazine

creditfixsolutions.com.au

No obligation, free assessments info@creditfixsolutions.com.au available for any credit reports on 02 8896 6256 | Toll Free: 1300 43 65 69 behalf of your clients.

BRISBANE | SYDNEY | MELBOURNE | ADELAIDE | PERTH

Head of Research and Acquisition at Binnari Property, Dominic Cavagnino says, “In each of the periods where interstate migration has exceeded 30,000 per annum, we’ve seen the annual compounding growth rate between 9.42% and 15.83%. The figure above indicates that Queensland’s interstate migration has risen from a low of around 7,000 per annum and is re-approaching the 30,000 people mark. This, coupled with slowing supply of new stock and a significant infrastructure pipeline, will drive the Brisbane market performance in the next five years.”

In saying this, understanding the market is critical.

There are certainly areas of Brisbane which should be avoided. Identifying tightly held, blue chip areas without a high level of exposure to increased supply are key to investing successfully.

Despite Melbourne’s market also experiencing a correction, its performance has been different to Sydney’s, leaving pockets of opportunity.

Over the growth cycle, Melbourne’s housing market significantly outperformed the apartment market. As a result, the correction has occurred disproportionately in the housing market, prices

peaked at $750,000 in December 2017 and have since fallen to $680,000 as recorded in June 2019.

Median apartment prices have remained more stable, falling from $560,000 to $535,000 over the period.

Melbourne’s market is underpinned by the strongest population growth in the country, achieving annual growth in excess of 100,000 people for almost five consecutive years. The strong apartment investment opportunities in Melbourne are scarce but do exist in some suburbs where supply has been limited and demand remains high.

“These factors are all combining to making it an ideal time to invest in some areas of the Brisbane and Melbourne markets,” Grant concludes.

Sources: 1. Report by LF Economics founder Lindsay David. 2. Ninemsn.com.au.

Chifley Securities | Private Commercial Lending

With more deals and more lending alternatives, your chances of settling are BIGGER with Chifley!

Rely on our STRENGTH to complete all your Commercial Property transactions... ✔ ✔ ✔ ✔ ✔ ✔

Earn your full commission No clawbacks Full support throughout the transaction On the job training where needed Payment within 3 days of settlement Benefit from our rewards programme

www.chifleysecurities.com.au | 1300 782 210

Broker Magazine

53

STATE PRESIDENTS FOR

2019

Queensland & Northern Territory - State President

New South Wales & ACT - State President

Liberty Network Services Mobile: 0434 338 584 Email: qld@fbaa.com.au

Founder & CEO of Property Loan Advisor Mobile: 0417 024 300 Email: nsw@fbaa.com.au

Trent CARTER

Victoria & Tasmania - State President

Western Australia - State President

General & Commercial Financial Services Pty Ltd Mobile: 0478 040 714 Email: vic@fbaa.com.au

Head of Finance & Advisory Provident Lending and Business Solutions Mobile: 0448 773 310 Email: wa@fbaa.com.au

South Australia - State President Director Finance Opportunities Mobile: 0419 820 149 Email: sa@fbaa.com.au

Broker Magazine

Felicity HEFFERNAN

Brendon KURTZ

Joff O’SHANNESSY

54

Christine GREEN

Would you like more information on an FBAA event or PD Day thats happening in your local area? Maybe you have some feedback or an issue you would like to discuss?

Finance Brokers Association of Australia Street: Level 1, 116 Ipswich Road, Wooloongabba Qld 4120 Post: PO Box 177, Coorparoo Qld 4151 Phone: (07) 3847 8119 Email: info@fbaa.com.au Web: www.fbaa.com.au

BOARD OF DIRECTORS

Tony Carter

Peter J White AM

Chris Szigeti

Cert IV FS (FMB), Graduate Management Qualification (GMQ) – UWA

Cert IV FS (FMB), CPFB, FMDI, MAICD

AFB, Cert IV FS (FMB), Dip (ML) Sec

Managing Director Special Responsibilities Government, Media and Strategy

Inst, LREA, MAICD

Peter has vast experience in Banking and Finance spanning over 40 years, which includes his most recent admission onto the advisory board of the Small Business Association of Australia. Peter is highly engaged with Government and Industry Regulators ensuring beneficial outcomes for current & future reviews that are, and will be undertaken. Peter has held FBAA roles of NSW President, National Vice President, National President, Chairman of the Board of Directors and Chief Executive Officer.

Chris has been involved in the finance industry since 1975, running his own Mortgage and Finance business, Chris Szigeti & Associates t/as CSA Finance and Mortgages Can Do since He started his finance career with IAC ( Citibank ), then 10 years with AGC, where he held senior managerial roles covering all aspects of Finance. Chris was a founding member of FBAQ in 1992 which evolved into the FBAA. He was Queensland State President (2004-2009), first elected to the Board in 2009 as National Treasurer (2009-11). Chris was admitted to the status of Life Member in 2014 in appreciation of services provided to the Association and Members.

Phone: 07 3847 8119 Email: pwhite@fbaa.com.au

Managing Director Chris Szigeti & Associates Pty Ltd T/as CSA Finance & Mortgages Can Do Phone: (07) 5592 2635 Email: cszigeti@fbaa.com.au

Director Special Responsibilities Chairman of the Board of Directors

Tony has been involved with the motor and finance industry for over 40 years, the last 20 as Dealer Principal/Director of 3 motor dealerships. He has been engaged with finance since early career days at AGC and was a Licensed Finance Broker in WA from 2004 to 2013 ending as an ACL holder when he resigned from the motor dealership position.

Today Tony holds a Credit Rep role under his son’s company Echo Finance and runs his own Vehicle and Finance Brokerage in WA – Brokerage WA. Over the past 20 years Tony has been on three NFP boards – BIZLINK – Chairman, Asthma Foundation WA – Chairman and Asthma Australia – Director.

Principal Broker Brokerage WA Phone: 0418 911 220 Email: tcarter@fbaa.com.au

Director, FBAA Life Member Special Responsibilities - Vice Chairman and IDR Chairman

Broker Broker Magazine Magazine

55 55

BOARD OF DIRECTORS

John Mulcair

Kim Szigeti

BBus, CPA, GCM, DipFS, MAICD,

JP (Qual), AFB, Cert IV FS (FMB), Dip

Director, FBAA Life Member Special Responsibilities – Treasurer and CFO

FS (FMBM), MAICD

Director Special Responsibilities Company Secretary, Director Policies, State Branches

John Mulcair has vast experience in banking, finance and accounting spanning more than 50 years. John joined FBAA in 2002, was appointed ACT Representative in 2003, ACT State President in 2005, first appointed to the Board in 2006, National Treasurer 2006-08, Board Consultant 2009-11, then re-appointed to the Board as National Treasurer in 2011. John was admitted to the status of Life Member in 2009 in appreciation of services provided to the Association and members.

Kim Szigeti has vast experience in finance and mortgage broking spanning more than 20 years, and currently holds a Real Estate Licence. Prior to this Kim held various positions in retail and hospitality, as well as volunteer in previous and present positions with community organisations.

Kim joined FBAA in 2005, was Secretary of QLD Council 2007-2009, and elected to the Board in 2015.

Director Wilde Mulcair Pty Ltd Mobile: 0416 049 423 Email: jmulcair@fbaa.com.au

Mortgages Can Do Phone: (07) 5592 2635 Email: kszigeti@fbaa.com.au

56

Broker Magazine

Stephen Rasmussen AFB, Cert IV FS (FMB), B.Com (Prof Acct), MAICD

Director Special Responsibilities­­ Audit & Risk Committee, Chairman- Equity Release/ Reverse Mortgage Committee Stephen has been involved in the finance and banking industry for more than 40 years, starting with the CBA in a branch environment. Stephen started his own broking business in 1995, essentially as a one-man operation. Stephen was appointed as QLD/NT State President in 2009, and then elected to the Board in 2016

Managing Director Tailored Lending Concepts Mobile: 0412 295 875 Email: srasmussen@fbaa.com.au

Rick Nieuwenhoven

Jan Kirstein

AFB, Cert IV FS (FMB), B.Com (Prof

Director, FBAA Life Member Special Responsibilities Board Liaison for State Presidents

Acct), MAICD

Director Special Responsibilities – Member Finance, Audit and Risk Committee

Dip Fin Serv (MBM), Cert IV, FSMP, Dip FP, Com Dec, AFB, MAICD

Gus Gilkeson Director Special Responsibilities – Governance Committee

Rick Nieuwenhoven has vast experience in accounting practice and education, finance, financial planning, property investment, and mortgage broking spanning more than 15 years, and currently is a registered agent of ASIC. Rick joined FBAA in 2012, was SA State President 2013-15, and elected to the Board in 2015.

Jan commenced his finance career in 1976 and has worked principally in senior lending and sales roles. Jan joined the broking industry in 1996 and formed his own broking company in 1998. Jan joined FBAA in 2002, was appointed North Queensland representative of the Association in 2002, and has been a Director since 2005. He has held several positions on the board such as National President, Chairman of various committees and has been Chairman of the Board for a number of years. Jan was admitted to the status of Life Member in 2013 in appreciation of services provided to the Association and members.

Gus has spent 19 years in financial business development, product development and origination – primarily responsible for loan origination and structuring. He has held successful roles building and running teams with domestic trading and investment banks, financial advisory firms, private lenders, mortgage and funds management, commercial finance broking.

Gus has reviewed thousands of individual business and property finance applications in most sectors and has completed billions of dollars worth of loan settlements. Gus holds tertiary qualifications in Information Technology, Financial Advisory, Mortgage and Finance Broking

Business Owner Nieuvision Phone: (08) 8263 4009 Email: rnieuwenhoven@fbaa.com.au

Principal Brokir Pty Ltd Phone: (07) 3847 8119 Email: jkirstein@fbaa.com.au

Managing Director Grow Capital Phone: 0423 001 002 Email: ggilkeson@fbaa.com.au

Broker Magazine Broker Magazine

57 57

CHALLENGE THE FUTURE

The future depends on what you do today.

- MAHATMA GANDHI

58

Broker Magazine