Australian Broker 17.10

JUNE 2020 ISSUE 17.10

Tech benefits are here to stay Digitisation changes over the last two months are expected to far outlast the pandemic /08

Big trends driving commercial lending COVID-19 has fast-tracked a lot of the trends we were already seeing, says Prospa’s Beau Bertoli /17

BRENDAN WRIGHT Leaders are never tested more than they are in a crisis – but as FAST CEO Brendan Wright says, this is an opportunity as much as it is a challenge /14

01_AB1710_Cover_SUBBED.indd 1

How SMEs must look forward Thinktank’s Peter Vala asks how SMEs will pivot and adapt to the changing environment /20

ALSO IN THIS ISSUE… Rolling 14 facilities into one This refi nance deal takes the cake when it comes to consolidation /22 Your ‘return to offi ce’ strategy Can staff refuse to return to the office if you tell them it’s time to come back? /23 In the hot seat Searching for a career rather than just a job, Deanna Ezzy lucked into broking /30

25/05/2020 8:45:44 AM

NEWS

IN THIS SECTION

Lenders Major bank balance sheet ‘stronger than ever’ /04

Industry groups FBAA: Don’t let clients get trapped in insuitable loans /06

Market Fintech looks to fi ll fi nance gap for JobKeeper applicants /10

Aggregators Connective: Lender behaviour reshaping broker process /12

Technology Lender says digitisation benefi ts are here to stay /08

www.brokernews.com.au JUNE 2O20 EDITORIAL

SALES & MARKETING

Editor Sarah Megginson

Publisher/Sales Manager Simon Kerslake

News Editor Madison Utley

GLOBAL WATCH How is the mortgage and broking world responding to the COVID-19 pandemic overseas?

Here’s your snapshot of the news that matters most to the mortgage industry in North America

TRUMP CORP ASKS TRUMP ADMINISTRATION FOR RENT RELIEF Trump Corporation is reported to have asked the federal government for rent relief on one of its most iconic hotel properties, Washington D.C.’s Trump International Hotel. The hotel, where several countries have been accused of renting rooms to curry favour with the Trump administration, has been one of the Trump Corporation’s most controversial properties. Now, with its bar, restaurant and spa all shuttered, Trump International Hotel is just another hospitality property struggling to make ends meet.

Eric Trump said the Trump Organization was still current on the $270,000 monthly payment it makes to the U.S. General Services Administration, from which it leases the iconic property, but has made a request for a rent delay in line with what has been granted to the hotel’s other tenants.

THE

Production Editor Roslyn Meredith

ART & PRODUCTION

Global Head of Communications Adrijana Monevska

CORPORATE

Designer Jommel Ramos

Chief Executive Officer Mike Shipley

Production Manager Alicia Chin

Chief Operating Officer George Walmsley

Traffic Coordinator Kristine Jamir

Managing Director Justin Kennedy Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil

EDITORIAL ENQUIRIES

Madison Utley +61 2 8437 4700 madison.utley@keymedia.com

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WORKERS PREPARE TO HEAD BACK TO THE OFFICE many companies across North America there has been a massive shift in focus from crisis management, business continuity and workplace resilience to re-entry and reintegration into the office. Each organisation is moving at its own pace when it comes to re-entry.

Commercial real estate firm JLL recently released a guide to returning to work in the new normal. “There are a multitude of possibilities; nothing is off the table. There may be deep change, there may be light change, but what we know for sure is there will be change,” said Ram Srinivasan, managing director, consulting, at JLL. “Effective communication is critical … there’s also a big realisation happening that re-entry is a complex project and it will require cross-functional expertise.”

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HOW WILL COVID-19 AFFECT AFFORDABLE HOUSING? latest numbers show that the US unemployment rate has topped 15%, with THE about 26 million Americans out of work due to the coronavirus. While most renters were able to keep up with rental payments in April, the coming months are going to be more telling as to the impact on affordability in the multifamily sector.

“What we’re hearing from developers and property managers is that impact to subsidised housing is nominal because the government helps guarantee those payments, and the upper-end market is not as affected, but the concern comes from workforce housing and naturally occurring affordable housing,” said Marsha Goff, executive vice president and Fannie Mae and Freddie Mac chief underwriter for Merchants Capital, a mortgage banking firm that specialises in multifamily and affordable housing.

This magazine is printed on paper produced from 1OO% sustainable forestry, grown and managed specifically for the paper pulp industry Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as Australian Broker magazine can accept no responsibility for loss. Australian Broker is the most-often read industry publication, according to independent research carried out by the Ehrenberg-Bass Institute for Marketing Science at the University of South Australia in December 2008. The research also found that brokers rate Australian Broker as the best for both news content and feature articles, followed by sister publication MPA. Overall, on all categories, Australian Broker ranks top followed by MPA. The results were based on a sample of 405 respondents who were the subject of telephone interviews.

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25/05/2020 8:48:49 AM

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25/05/2020 8:49:44 AM

NEWS

LENDERS NON-BANK LENDER ISSUES $1.25BN RMBS

CBA HOME LOAN DEFERRALS Source: CommBank, 30 April 2020

says it has “effectively reopened” Australian debt capital markets with a $1.25bn residential mortgage-backed securities (RMBS) raising. It was the largest securitisation in the world since COVID-19 took hold in March and, according to the group, has confirmed Australian residential mortgages as a global safe harbour investment. La Trobe Financial saw support not only from Australian institutional investors but also global investment houses in Asia, the US and Europe.

Proportion of CBA deferral requests by loan type*

LA TROBE FINANCIAL

Owner-occupier loans

71%

Investment loans

29%

Interest-only loans

16%

Principal and interest loans

84%

LENDERS CALL IT QUITS ON ACQUISITION 13 May, CML Group announced to the ASX that its proposed acquisition by Scottish Pacific would not be proceeding.

CML Group provides debtor, equipment and trade finance to SMEs. Over the past few months, the group has been the subject of a takeover offer from Affinity-owned Scottish Pacific, but the deed that set out the key terms of the arrangement has been terminated by “mutual agreement”. Scottish Pacific will pay CML a $1m break fee to cover costs associated with implementing the Scheme of Arrangement.

ON

“Our banking businesses have performed well, resulting in above-market growth in deposits and home lending” Matt Comyn CEO, CBA

Commercial Loans

Note: Figures based on 144,000 home loan deferral requests

MAJOR BANK REPORTS BALANCE SHEET ‘STRONGER THAN EVER’ CBA has detailed its support for customers affected by COVID-19, saying this was backed by a strong balance sheet update for the March quarter highlighted the support it has provided to the Australian economy and provided updated statistics around the utilisation of its COVID-19 support package.

The report said the bank’s balance sheet was “stronger than ever before”.

“Since the start of the pandemic, we have provided support to approximately 100,000 businesses and one million personal customers,” said CBA CEO Matt Comyn.

“This includes the deferral of repayments on approximately 240,000 home, business and consumer loans, lower interest rates for borrowers, increased CBA’S

interest rates for depositors, and waived fees and charges.”

As of 30 April 2020, the bank had received deferral requests for 144,000 home loan accounts with balances totalling $50m. Of these, 71% concerned owner-occupier loans and the remaining 29% were for investment loans. Just 16% of deferral requests were for interestonly and 84% for principal and interest loans. For business lending, CBA registered 70,700 loans for repayment deferrals with a balance totalling $15.2bn.

On 1 May, CBA reduced repayments for all variable principal and interest home loan accounts to the minimum required, releasing up to $3.6bn of additional cash flow into the economy.

By 6 May, the major had also approved over 6,500 applications for more than $555m worth of new lending through the Coronavirus SME Guarantee Scheme, split between the retail trade (18%), construction (16%), accommodation, cafes and restaurants (14%), and business services (12%).

“We’ve been able to do this quickly, thanks to our investments in digital banking and technology and the support of tens of thousands of people in our branches and Australia-based contact centres,” said Comyn.

“Through our strong operational execution, our banking businesses have performed well, resulting in above-market growth in deposits and home lending, and continued growth in business lending. Our balance sheet is stronger than ever before. Compared to pre-GFC levels, we now hold three to four times the provisions for credit losses, and our capital ratios are more than double on a like-for-like basis.”

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25/05/2020 8:50:21 AM

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25/05/2020 8:51:37 AM

NEWS

INDUSTRY GROUPS ACCC PROPOSES DATE FOR AFG-CONNECTIVE DECISION ACCC has set a new proposed date of 18 June 2020 for its decision regarding the AFG-Connective merger. The original date was 7 May, but the decision was postponed following a request from AFG for more time in light of the COVID-19 pandemic. “We are looking forward to the outcome of the decision and are confident we can satisfy the ACCC’s requirements,” said Connective CEO Glenn Lees. News first broke in August 2019 that AFG and Connective were set to merge in a deal valued at $120m.

THE

INDUSTRY WEIGHS IN ON DEFERRAL OF BID 8 May, ASIC announced that the best interests duty (BID) and remuneration reform were among the royal commission measures that had been deferred for six months. The industry has welcomed the decision, saying it shows that the government recognises the important role brokers play. However, several key players are clamouring for more clarity on when the final regulatory guidance can be expected, saying its release is crucial to their best use of the preparation time.

ON

DON’T LET CLIENTS GET TRAPPED IN UNSUITABLE LOANS, SAYS FBAA The FBAA has warned brokers against allowing their clients to be ‘lured’ into low-priced yet unsuitable fixed rate loans have been encouraged by the FBAA to take extra care when walking borrowers through the pros and cons of fixed rates so their clients don’t find themselves with a loan that becomes unsuitable when it reverts to a variable rate down the line.

While the big banks have the resources to offer attractive fixed rates, borrowers who are “lured” in by low prices may regret their decision unless they carefully examine the variable rate product of the lender.

“We want to ensure that our clients are not trapped,” said FBAA BROKERS

managing director Peter White.

“Borrowers may eventually find themselves with a variable interest rate that is not the best for their particular circumstances, and they may be prevented from changing lenders due to lender fees, new valuation costs and maybe even LMI insurance.”

While fixed rates can sometimes be the best option, White urged brokers to ensure their clients understood phrases such as ‘caveat emptor’ or ‘let the buyer beware’.

He said this not only underscored why people benefited from using a finance broker but emphasised the

importance of clients having access to non-major lenders that offer more choice of long-term products.

“Borrowers will never consider these options if they only look at the immediate fixed rate,” he said.

Further, while the introduction of the best interests duty has been deferred, White pointed out that it would still come into effect shortly, and brokers needed to take every action possible to ensure loans were not unsuitable.

“Banks [and mortgage websites] have no legal obligation to act in the borrower’s best interest, and if they can seduce you with a low starting rate they will, and they can whack you later,” he said.

“It is imperative that borrowers obtain a thorough examination of their needs and desires for a mortgage that is not unsuitable for them now, but more importantly in the coming years.”

“It is imperative that borrowers obtain a thorough examination of their needs and desires for a mortgage that is not unsuitable for them” Peter White Managing director, FBAA

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25/05/2020 8:53:02 AM

NEWS

TECHNOLOGY

NON-MAJOR INTRODUCES DIGITAL SIGNATURES non-major bank has joined the ranks of lenders that are making big strides forward in digitising their home loan processes in the COVID-19 environment. ING has announced that, effective immediately, applications submitted via ApplyOnline can be accepted with electronic signatures provided through a platform such as DocuSign.

The bank said its introduction of e-signatures was designed to simplify the application experience, as well as complement its recent decision to allow brokers to verify the identity of home loan applicants via digital video technology.

ANOTHER

LENDER SAYS DIGITISATION BENEFITS ARE HERE TO STAY Digitisation changes over the last two months will deliver long-lasting benefits, according to one non-bank lender digitisation of processes and communication methods brought about by the need for social distancing will deliver benefits that far outlast the pandemic, says Liberty group sales manager John Mohnacheff.

He believes the key benefit of digitisation is the time reclaimed by brokers through the enhanced efficiencies it offers.

“For most brokers, this is invaluable, as it gives them more availability to nurture important customer relationships, improve professional partnerships and prospect for new leads,” Mohnacheff said.

Liberty has encouraged brokers to put the time freed up by the elimination of commuting and the need travel to meetings into exploring new methods of establishing authentic customer connections.

“Engaging on social media is something brokers may now want to invest more time in doing,” Mohnacheff said. “It not only THE

MERGED FINTECHS LAUNCH HOME LOAN PLATFORM Australian fintechs have merged to establish a “revolutionary” online home loan auction platform. The digital marketplace formed as a result of Joust and LoanDolphin’s partnership connects home loan customers directly with lenders and brokers who bid for the customer by offering the best home loan rate. The group says the “reverse auction model” enables lenders to access customers fairly and on the same terms. Both companies were founded in 2015 by ex-bank executives. Together they have processed $3.3bn in loans and reduced the average customer’s interest rate by 0.74%.

TWO

8

offers a way to reach more potential customers but to bond over shared experiences. Sharing regular updates can be a great way to showcase more about who you are and build trust with your followers.

“Consider what you have in common. Are you homeschooling children? Spending more time in the kitchen? Finding new ways to work out? Whatever platform you choose to use, remind customers that you understand what they’re going through and highlight how you can still support them with their finance needs.”

Communicating through technology rather than in person does not prohibit brokers from having the same deep level of personal connection with their customers, as far as Liberty is concerned.

“By consistently showing up for customers and supporting them in weathering this storm, brokers may find their personal connections become even better

than before,” said Mohnacheff.

“You might even find that some customers actually prefer the flexibility that comes with seeing their broker online as opposed to meeting with them in person.

While COVID-19 may have slowed us down for the time being, the reality is that many people are time-poor.

“From phone calls to email and video, brokers have access to a range of options that allow them to continue to support customers with their lending needs. Often, these methods are so effective that there is little interruption to the level of service that customers have become accustomed to.”

Mohnacheff encouraged those struggling to keep up with the industry’s digitisation to reach out to their team, aggregator or BDM. “It’s also worth having a conversation with friends or colleagues about what technology or tools they are using within their own businesses. Find out what works for them,” he added.

“Remember, integrating technology into your business isn’t about overhauling your usual practice. It’s about enhancing your existing operations, strengthening your offering, and ultimately, making life easier for you and your customers.”

www.brokernews.com.au

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25/05/2020 8:53:38 AM

TECHNOLOGY UPDATE

BOUTIQUE BROKER SHARES RECIPE FOR SUCCESS the unparalleled turmoil and disruption that we’ve been living through over the past 18 months – namely new compliance requirements, bushfires and COVID-19 – boutique brokerage Your Elite Broker (YEB) has been powering ahead since its inception three years ago.

YEB was founded by husband and wife Azad and Dersim Jolan, who believe their decision to focus heavily on technology has given them a distinct edge.

“I would put it down to the trust factor and our early adoption of technology,” says Azad.

Dersim adds that “another key point of brand difference is that YEB is a husband and wife team approach. Our diverse backgrounds add to the trust factor and the expertise we can offer clients.”

Dersim completed a Master of Law at Stockholm University and briefly practised as a lawyer in Sydney prior to meeting Azad and shifting into the mortgage broking industry.

“Azad is innately tech-driven, a trait that contributed to his success during his many years as a licensed real estate agent,” says Dersim.

YEB addressed upfront their tech stack in a concerted effort to drive maximum back-office efficiencies and uphold the strength of their trusted brand.

NextGen.Net’s ApplyOnline platform is a vital part of their technology approach.

“ApplyOnline is the industry standard for electronic lodgement, and our aggregator, My Local Broker’s CRM, integrates deals directly into ApplyOnline,” says Azad.

“As we grew to understand it more through NextGen.Net training sessions, we learned how to maximise its tools, which led to increased efficiencies and slashed our time to approval.”

NextGen.Net has invested significantly in product training to support brokers and enhance the awareness and understanding of ApplyOnline’s many time-saving features.

“Initially I wasn’t very tech savvy,” Dersim laughs.

“Taking on the back-end role meant I had to learn how to process the deals. It wasn’t a DESPITE

Azad and Dersim Jolan, founders, Your Elite Broker

hard transition. The training taught me a lot.”

Straight-through processing (STP), the ‘Holy Grail’ of the mortgage industry, is an achievable reality with NextGen.Net’s approach to innovation and strong focus on ensuring users maximise the technology available to them.

“NextGen.Net has released a number of valuable features over the past couple of years, and we want to ensure our customers reap the full benefit,” says NextGen.Net Chief Customer Officer Tony Carn.

“We’ve been amping up our training, especially via webinars during COVID-19 lockdowns, to support our customers and increase awareness of these tools.

“Brokers have been facing major challenges recently,

and witnessing YEB’s success through embracing and using the ApplyOnline platform effectively is very pleasing.

“We’ve seen a real spike in broker attendance at our webinar training sessions – further validating the need and value of helping brokers ‘retool’ during these challenging times,” says Carn.

Azad points to the ApplyOnline Supporting Documents service tool e-Sign, which he says has given YEB the ability to bypass face-to-face interviews during the COVID-19 crisis. “e-Sign and the recently launched Document Verification Service coupled together are powerful tools in this environment,” he says. “I advocate that all lenders turn it on.”

Dersim agrees, noting that from her perspective the main

misconceptions regarding ApplyOnline come from a lack of understanding of how tools work.

“When a broker invests time out of their business to attend a NextGen.Net training session, they often experience light-bulb moments,” declares Carn.

As Azad explains, “The success of our business rides on our reputation, and intrinsically linked to our mission to go above and beyond for our clients is a system that’s reliable and easy to use.

“We’ve been very happy with ApplyOnline because it’s always been responsive and reliable.

This is critical to upholding our brand promise while also reducing our workload and costs, which can ultimately make or break a broker’s business in the current market,” he says.

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25/05/2020 8:54:12 AM

NEWS

MARKET SOLUTION FOR SENIORS SHORT ON CASH FLOW investment platform DomaCom has invited expressions of interest from seniors who would prefer to access equity in their home to ease cash flow concerns, rather than raid their superannuation or sell other assets in today’s depressed market. DomaCom’s equity release solution for seniors differs from more traditional reverse mortgage models and the government’s Pension Loan Scheme. Its fractional model is a shared-equity structure that allows seniors to sell part of their home to one or more investors, while remaining in the property as long as they want.

FRACTIONAL

AUCTION WITHDRAWALS CAUSING ‘ARTIFICIAL LOWS’ declines in the auction clearance rate “can be explained through an engineered slowing of auctions”, said CoreLogic head of research Eliza Owen. “This is important to note, because clearance rates and changes in home values have historically been closely correlated,” she said. “At face value, the sharp fall in clearance rates implies housing values could follow a similar trend; however, there is a good chance the relationship has at least temporarily disconnected due to the high withdrawal rate dragging the clearance rate to artificial lows.”

RECENT

FINTECH LOOKS TO FILL FINANCE GAP FOR JOBKEEPER APPLICANTS A finance and investment marketplace has launched a cash flow solution for small businesses while they wait for approval of their JobKeeper applications has developed a new payment gateway offering, UnLock, to assist small businesses while they wait for JobKeeper payments to come through. By paying suppliers upfront, UnLock can extend a business’s payment terms on invoices, thus freeing up its cash flow to be redirected to staff wages rather than supplier and agency invoices and commercial rent.

“UnLock is a business-to-business buy now, pay later method that enables small and medium-sized businesses to improve their working capital to have financial flexibility as needed in the current operating environment,” said Marketlend CEO Leo Tyndall.

“UnLock extends payment terms on invoices, and suppliers are MARKETLEND

paid upfront in return for a fee.

Businesses can use UnLock funds, starting from $50,000, immediately rather than dipping into their accounts before sales are acquired.

“By creating cash flow, paying suppliers and transferring the risk to ourselves, UnLock enables businesses to have more financial flexibility, particularly during this unpredictable time.”

The government’s $130bn JobKeeper scheme was launched to assist businesses that are struggling to pay wages through the COVID-19 economic slowdown.

More than 900,000 businesses have registered their interest in accessing payments, and 500,000 have filled in formal applications.

However, the scheme has presented cash flow issues for

some businesses, particularly those that are earning no income while waiting for their application to be reviewed and approved, as they must continue to pay eligible employees a minimum of $1,500 per fortnight in order to meet the criteria for receiving the payments.

“The JobKeeper payments are paid out as a reimbursement.

That means, in order to be eligible to claim, employers must have already paid out employees’ wages from March 30 to the time they receive the payment,” said Tyndall.

“For some employers, this means they will have to cover at least five weeks’ worth of payroll before being reimbursed. Businesses have an option of taking out a loan, which includes an overdraft, or looking at other options, such as UnLock.

“The JobKeeper initiative is a great help for businesses who want to retain staff. If cash flow is managed well with a working capital solution, the business will have the flexibility to keep suppliers paid with the same payment terms and pay their staff wages.”

“Some employers … will have to cover at least five weeks’ worth of payroll before being reimbursed [by JobKeeper]”

Leo Tyndall CEO, Marketlend

JOBKEEPER PAYMENT STATS Source: Marketlend

10

900,000

500,000

$130bn

Number of Australian businesses that have registered an interest in accessing JobKeeper payments

Number of Australian businesses that have filled in formal applications for JobKeeper

Value of the JobKeeper scheme to assist businesses that are struggling to pay staff wages through the COVID-19 crisis

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25/05/2020 8:55:01 AM

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NEWS

A G G R E G AT O R S

AGGREGATOR LAUNCHES PODCAST SERIES FAST has launched a new, diversityfocused podcast series, ‘Adjust the Contrast’. CEO Brendan Wright says the case for diversity has “never been stronger” than it is now, as the COVID-19 pandemic is pushing businesses to adapt their business models and approaches. “The podcast series is all about demonstrating how diversity can protect businesses from risk and … create opportunity,” he said. “Creating a culture that enables diverse thinking, knowledge and capability across the team can really help differentiate businesses so they stand out, particularly in a service-led industry.”

AGGREGATOR

CONNECTIVE: LENDER BEHAVIOUR RESHAPING BROKER PROCESS Aggregator refashions lender program as brokers look for new ways to source information on changing lender policies says its Digital Lender Splendour program is intended to help ease the challenge for brokers of staying up to date with rapidly changing lender products and policy due to the COVID-19 pandemic.

The new portal will ensure that brokers can access lender information, real-time updates on policies and products, and other lender resources “whenever and wherever” they need them.

The difficulty of keeping up with changing policies has not just led to a spike in broker demand for new ways of accessing lender information, says Connective executive director Mark Haron, but has also begun to reshape the broker process of securing home loans for customers.

According to Haron, brokers’ processes have traditionally CONNECTIVE

OPEN BANKING WILL HAVE ‘WINNERS AND LOSERS’ aggregator’s head of digital has urged brokers to act now to prepare themselves to leverage the new capabilities created by opening banking so they can offer an improved customer experience.

“The open banking train is leaving; if you’re not on board, you’re going to be left behind. There will be winners and losers as a result of this,” said Loan Market’s Jason Furnell.

He believes thriving in the new environment will reflect what good brokers already do – create trust.

“Customers need someone they trust to understand how to use and control their data,” he said.

AN

12

followed the same trajectory: they start with working through how much a customer can afford to borrow, then figure out the product type they want, and finally, they look at the policy of each lender to deduce whether or not the borrower would be able to secure the loan with that institution.

However, he said, “Now, a lot of brokers are no longer waiting until a customer makes an enquiry about a particular bank.

“They’re going and taking a look at banks’ information on a regular basis and keeping that information in the back of their mind so, when they then need to have a more thorough look, they’ve got a better chance of knowing which avenues to begin exploring. Being able to see the most recent lender changes helps them get a quicker result in terms

of analysis for their customers.”

The last point is crucial, as Haron said the most commonly cited concerns voiced by brokers were around turnaround times.

While some banks have maintained their time to approval and gone to great lengths to make sure brokers know that’s the case, others are struggling under the weight of COVID-19 enquiries.

“When considering a loan, if one of a customer’s highest priorities is that it gets settled in a timely manner, then that for me, from a best interests point of view, becomes a key factor in determining which lender to proceed with,” Haron said.

“I’m hearing anecdotally now some horror stories of lenders missing settlement dates because they’re not able to get documents out fast enough for the customer to sign and reply to, and obviously it’s causing a lot of stress for people.

There’s not much point going with the cheapest lender who has the highest cash rebate if the loan is not going to settle in the time frame the customer wants.”

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25/05/2020 8:56:13 AM

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LEADING YOUR TEAM THROUGH A CRISIS Leaders are never tested more than they are in a crisis, and Australia has never faced a crisis quite like this pandemic. Brendan Wright, CEO of mortgage aggregator FAST, shares why he believes what we’re experiencing now is an opportunity as much as it is a challenge

no denying we’re facing unique and challenging times at present. To complicate matters further, the state of play seems to be changing daily.

Restrictions have been imposed by the government and then slowly wound back. Workplaces and incomes have been massively impacted and then supported via hundreds of billions of dollars’ worth of stimulus packages.

As the situation continues to evolve, it’s up to the leaders in our business community to shine a light on the most effective and efficient ways to move forward. And that begins by keeping everything in perspective, argues Brendan Wright, CEO of mortgage aggregator FAST. “These are very difficult times, but we won’t be here forever,” he says.

THERE’S

“This is a crisis, and the pandemic is having an impact globally, which means it’s really important to focus on what matters. How do you focus in a crisis? There are three key things that matter most: one, take

Wright’s first point, about looking after yourself, draws parallels with the instruction we’re given before take-off on a plane: the one that reminds you to fix your own oxygen mask in an emergency before

“You can be a leader in your role, and you can take a leadership point of view … and you don’t have to be running the show to do that” care of ourselves. This allows for number two – so you can look after each other. And number three is to deliver what matters. These three things are crucial in a crisis.”

attempting to help anyone else.

It sounds admirable in theory, but in practice it can be challenging to administer self-care when there have been so many logistical,

mental and health issues to address along the way.

Wright says it starts with certainty through recognising the unexpected rewards, however insignificant they may seem.

“Now that people are working from home, many of them have been able to tidy up their home offices and set up a space that is organised, uplifting and really makes them feel good about spending time there,” he says.

“Then there’s the value of autonomy: it’s important to maintain a sense of creating structure in your day. From keeping track of how much water you’re drinking throughout the day to ensuring you get some exercise in, it’s about moving your body outside and getting active. It really makes a difference around the loss of

HOW TO FOSTER RESILIENCE IN A CRISIS

Building a sense of resilience during difficult times comes down to three key areas, says FAST CEO Brendan Wright: certainty, autonomy and relatedness:

Certainty is about controlling those things you can control, by creating a clear structure to guide your day

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Autonomy is about empowering yourself to commit to your highest and best use of time and resources, by adopting habits that sustain you

Relatedness is about connecting with others, whether through long phone calls with friends, Zoom meetings at work, or meeting up locally with loved ones

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In partnership with

Brendan Wright, CEO, FAST

autonomy that can come with [living through a crisis like COVID-19].”

If you set yourself up as best you can to succeed, this puts you in a position to give customers the best possible service.

This is where Wright sees the current environment as providing “a leadership opportunity as well”.

“You can be a leader in your role, and you can take a leadership point of view and behaviour within a business – and you don’t have to be running the show to do that. Anyone can step up and show their value as a leader through their actions in these times,” Wright says.

“Whatever role you’re playing, remaining calm is critical because it enables others to see a way forward.

When you’re calm, you’re able to be clear about the situation and

the actions you need to take and the progress that is being made.

Calm doesn’t mean laid-back; it means you’re being measured and thoughtful – and being consistent in your language, in your actions and in

he adds, while also prompting us to reflect on previous challenges and the strategies we used to overcome them.

“The industry has experienced some interesting and challenging times before COVID-19, through

“The value of mindfulness and connectedness plays a key role these days around how people deal with stressful situations, crisis and change” your behaviours. This is particularly important given the uncertain and challenging times we are in right now.”

The pandemic is teaching us a number of lessons about resilience,

which we’ve learnt about the importance of working together from an industry perspective. If you think about the journey we’ve had as an industry over the last couple of years,

from the ASIC review into broker remuneration, which flowed through into the royal commission, it’s really brought us together,” Wright says.

“The one thing you can always count on is change – it’s happening all the time. In a changing environment, those who can leverage diversity, be inquisitive, and involve those people who are impacted most in the decisionmaking process will be the most successful. As a leader, simply saying, ‘Here it is – this is what’s happened and this is how we’re doing it now’ will understandably scare people, especially those who are recipients of the change.

However, if you can involve the people who are going to be impacted and have them contribute to the process, it creates ownership www.brokernews.com.au

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25/05/2020 8:58:23 AM

FE AT URES

IN THE SPOTLIGHT: DAVID MCCLEERY, MCP GROUP As the co-founder and executive director of MCP Group, David McCleery is leading a diverse national team of industry professionals across the banking, finance, legal and insurance industries. In the current environment, he’s drawing on decades of business and leadership experience to not only shepherd his own business and team forward but also help mortgage clients through the COVID-19 crisis and beyond.

Since the onset of the pandemic, McCleery says he has embarked on a “resharpening or refocusing” of his leadership approach.

“I don’t want to sound too strategic, but people are crying out for context. They want to know: what does this pandemic mean for me? That’s where brokers have a critical role in helping during these times,” he explains.

With mortgage clients, McCleery says the key has been to try to offer context, rather than just “giving our clients a data dump”.

“So much is anecdotal, and the facts that are being reported are lag indicators, when what we really need is leading indicators. We’ve been reaching out a lot, talking to a number of people and trying to get the pulse of what’s happening so we can keep our clients updated,” McCleery says.

“Some of the communication we’re sharing is also very specific, such as the next steps to do with hardship applications and deferring mortgage repayments. On the other side of this, there are people contacting us for funding to leverage opportunities in this market, so it’s become important to offer context of the issues in the short term that need responding to now, but also recognising how it will fit into the longer term.”

McCleery’s leadership approach has been distilled to a key focus on offering as much straightforward, simple direction as possible, with a preference for action-oriented strategies over platitudes.

“I think this is a great chance for brokers to confirm or adapt the positioning of their brand and the services they provide, or who they want to provide services to,” he says.

“The most important thing is acknowledging that we don’t have all the answers. But what we do have is some great people on our team and in the industry, including other FAST brokers who we can reach out to for support and to help you move forward.”

and understanding of the change.”

Wright also believes that, in terms of effective leadership, mindfulness and connectedness play a huge role that shouldn’t be underestimated.

It was significant before COVID-19 but has become integral since the world as we know it was essentially flipped on its head.

“The value of mindfulness and connectedness plays a key role these days around how people deal with stressful situations, crisis and change,” Wright says.

“It’s about, what are you doing to give yourself some headspace?

How are you clearing your head and getting crystal clear about what’s going on in your life right now?

Having structure in your day makes a really big difference.”

Wright points to a small but significant change he made recently in an effort to practise what he preaches – by adapting his technology habits.

“Something that I have done personally, and this is backed by science, is address the ‘blue-light disco’ – the one that comes from your iPad or phone. I took the micro step of removing those devices out of my day an hour before I went to bed. I’m not even reading a book on my iPad. If I’m going to read before bed, I’ll read a book,” he explains.

“Locking those devices away an hour before I go to bed means the 16

first thing I do when I wake up in the morning is not reach for my phone.

I have an old-school digital alarm clock, so I don’t fall into the trap of saying, ‘I need my iPhone for the alarm’. I started doing this last year, and I am genuinely sleeping better because I no longer have that blue light messing with my melatonin levels and impacting my sleep.”

Adopting mindfulness habits also extends to setting clear boundaries with your workload so you don’t “run the risk of burnout”, Wright says.

“If you’re looking at emails and

your people so you can deliver what matters most, brokers are also navigating a new business environment.

Right now they are at a unique intersection: one that places brokers in between banks (handling an unprecedented storm of hardship assistance) and customers (hit by loss of income and freedom of movement or joblessness).

In this landscape, how can brokers reinforce their worth and commitment to Australian businesses and the economy?

“Brokers have always been, always are and always will be essential to a healthy finance system” replying at 10.30pm or in the early hours of the morning, that’s sending the wrong message to your people, your management team and your clients as well,” he says.

“Having some discipline with your inbox demonstrates that it’s OK to switch off on a daily basis, to spend time away from the devices, and that you genuinely care about that balance between work and life.”

Alongside all these efforts to look after yourself and look after

“Brokers have always been, always are and always will be essential to a healthy finance system. In times like this, so much innovation has come to light from a lender perspective on how things are done – from processes and digitisation to updated policies. There’s also a wide range of support that lenders are providing to customers, including businesses, then there is the comprehensive support that federal and state governments are giving.

It is a lot to navigate,” Wright says.

“How brokers understand that level of support and how it relates to their clients, and how well they communicate their service and value to their clients is the real opportunity for brokers at the moment. They are so well placed because brokers themselves are business owners. This enables them to have a unique mindset and offer insights from their own personal perspective. They can really demonstrate empathy and understanding.”

As restrictions continue to ease and the economy transitions out of hibernation, “some things will go back to the way they were, and some things won’t, but that’s OK; innovation has been accelerated with long-term benefits for us all”, Wright adds.

“In the environment we’re in now, the forthcoming best interests duty formalises what brokers are mostly already doing. It puts a legal framework around that and enables brokers to go to their clients and say that we are required to demonstrate to you and others that we put you and your needs first,” he says.

“We do that every day already, but we’re now required to do so by law, and that creates certainty for consumers.” AB

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FE AT URES In partnership with

BUSINESS VIE W

BIG TRENDS DRIVING COMMERCIAL LENDING COVID-19 has fast-tracked many trends that were already emerging in commercial lending. Now, Beau Bertoli, co-founder and chief revenue officer at Prospa, says the agile fintech is well placed to offer speedy turnaround times so SMEs can get back to business sooner

MFAA’s most recent Industry Intelligence Service (IIS) report, released in April 2020, shows that the number of mortgage brokers writing commercial loans as well as residential mortgages had increased to a fresh high of 3,670

by September 2019.

The uplift suggests that “in a challenging home loan market, more brokers are turning to diversifying into this sector, expanding their portfolio beyond just residential home loans into other growth sectors”, the report found.

This promising growth in the THE

in this new environment, and speed, simplicity and great service are now more important than ever.”

Indeed, brokers have embraced the rapid shift towards adopting more flexible ways of working, including virtual verification of identity processes that have the potential to speed up the financing of property.

Of course, for Prospa, speedy turnaround times have long been part of its core offering.

“Our online applications take 10 minutes, and our credit decision engine analyses over 450 unique data points in around 15 seconds. We’re

“Our credit decision engine analyses over 450 unique data points in around 15 seconds … and a response and funding are possible in 24 hours” commercial space seemed set to continue well in 2020 – until the COVID-19 pandemic hit, that is.

The commercial lending market has been one of the hardest hit by the pandemic. However, Beau Bertoli, co-founder and chief revenue officer at Prospa, says the biggest trend driving SME and commercial lending right now is digitisation.

“Microsoft research signals there has been two years’ worth of digital acceleration in a couple of months.

Government support has boosted awareness of non-bank lenders like Prospa and accelerated the adoption of digital products and services,” he says. “Small business customers, brokers and lenders are all operating

committed to lending responsibly, and a response and funding are possible in 24 hours,” Bertoli says.

“We just had a tiling business client in Victoria who used a loan to cover upfront costs for a big renovation project. He had to move quickly to get the order in from overseas and say yes to the opportunity. That speed is a huge relief for customers that want to get back to business.”

Bertoli adds that, as a fintech, Prospa is well placed to face the evolving challenges of the current market. The depth and breadth of its ability to offer funding can provide solutions across a range of finance types, from those small businesses that require funding to help with cash flow,

Beau Bertoli, co-founder and chief revenue officer, Prospa www.brokernews.com.au

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25/05/2020 9:00:38 AM

FE AT URES

foPROSPA BACK TO BUSINESS LOAN AND LINE OF CREDIT: TERMS

No repayments for the first six months

Loan term of up to 36 months or revolving line of credit for up to 24 months

No fees payable for the first six months

No asset security required

Supported by the government’s Coronavirus SME Guarantee Scheme

PROSPA BACK TO BUSINESS LOAN AND LINE OF CREDIT: ELIGIBILITY CRITERIA

      

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Small businesses with an annual turnover of less than $50m are eligible to apply.

The business must be registered and operating in Australia under a valid ABN. Funding must be used for business purposes only.

Funding must be used to support current and upcoming cash flow needs (including working capital, liquidity and operating expenditure).

Funding cannot be used to refinance existing loans with Prospa or any other lender.

The total funding supported by the government’s SME Guarantee Scheme (including funding from other financial institutions) must not exceed $250,000.

Prospa continues to responsibly lend to new and existing customers. Small businesses applying for a Prospa Back to Business Loan or Back to Business Line of Credit will need to demonstrate monthly turnover figures and that they have been trading for at least 24 months.

to equipment and vehicle finance, machinery or business car loans and business overdrafts. Prospa can meet the borrower’s needs in a variety of ways, with products and interest rates tailored to the client’s specific risk.

“We’re agile and can adapt quickly.

We use smart technology to assess risk, so we can continue to deliver a fast response in the current environment,” Bertoli says.

“Small businesses are navigating an uncertain time right now, and a quick application and decision means they can focus on getting back to business.

We’re also a cloud-based business, and our team can provide the same level of customer and partner support working remotely.”

While current conditions may be challenging, there are also plenty of reasons to be optimistic about the future. The value of commercial loans settled by brokers peaked at around $9bn in April–September 2019,

seeing a strong appetite for funding from a range of businesses.

“Recently there’s been strong appetite from businesses that have been able to end hibernation earlier than expected and are thinking positively and proactively about their recovery,” he explains.

“There are also businesses in certain industries that are experiencing increased demand for products and services and need funds to support growth. In addition to this, we’re seeing demand from otherwise viable businesses experiencing temporary cash flow issues due to COVID-19 that need funding to get them through this period.”

One of the biggest advantages Prospa offers SMEs right now is its speed of service, he adds. At a time when brokers are struggling with lenders that are taking several extra weeks to process even the most straightforward commercial loan

“The future is going to look different, and the brokers that win in this new market will be the ones that are agile and can adapt” according to the IIS report, with the total book value of commercial lending by mortgage brokers reaching a record high of $43.1bn.

Programs such as the government’s Coronavirus SME Guarantee Scheme, in which Prospa is participating, should put a foundation under commercial loans while the scheme is in operation – until September this year. Furthermore, they will go a long way towards raising small business awareness and consideration of non-bank lenders in the future.

“There is a lot of energy and enthusiasm from the broker community around the inclusion of non-bank lenders like Prospa in the scheme. It’s great to have this support, and we’re working closely with partners to responsibly distribute funding quickly to small businesses.

We’ve started rolling out our new Back to Business loan and Line of Credit products under the scheme, and these will be widely available to partners soon,” Bertoli says.

Prospa offers loans of up to $250,000 under the SME guarantee and $300,000 more broadly, and is

applications, Prospa remains able to deliver decisions within 24 hours – with funds available just as swiftly.

“We know small business owners don’t have time to fill out masses of paperwork or wait six weeks for a response. We offer a simple online application and use smart technology to deliver a fast credit decision, which is what small businesses need right now. They need to be able to make their next move,” Bertoli says.

“Looking ahead, one of the greatest opportunities we see is in the digital acceleration that has taken place. The future benefits for productivity, efficiency and communication are huge.

“Everyone is operating in a digital world right now, and this is an opportunity for brokers to re-evaluate how they run their business and deliver their services. I encourage brokers to consider investing in cloudbased solutions that can help them scale and deliver a seamless customer experience. The future is going to look different, and the brokers that win in this new market will be the ones that are agile and can adapt.” AB

www.brokernews.com.au

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THE NEED FOR SMALL BUSINESS LENDING



Invoice factoring: Also known as invoice finance, this allows small businesses to receive part of their outstanding invoices immediately to help maintain cash flow in the short term. Prospa doesn’t offer invoice factoring; however, SMEs that need help with cash flow or a way to boost working capital may find a Prospa loan or Prospa line of credit to be the right solution.



Equipment financing: Equipment loans, a way to finance purchases of equipment, are usually secured against the value of the business asset to be purchased. For borrowers who need to purchase business machinery, IT equipment, tools or even work vehicles, a Prospa business loan could be a good alternative to equipment finance.



Vehicle finance, business car loan or machinery finance: This can be a handy way of updating your fleet vehicles or covering the cost of large assets such as harvesters, excavators, commercial cookers, etc. A Prospa small business loan or Prospa line of credit may be able to cover these items.



Business overdraft: Also known as a business line of credit, this finance can help small businesses cover short-term cash flow gaps. For instance, it is useful to pay suppliers on time if you’re waiting for your own invoices to be paid by your customers.

www.brokernews.com.au

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25/05/2020 9:01:56 AM

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BUSINESS VIE W

HOW SMES MUST LOOK FORWARD The impacts of COVID-19 will reverberate for months and years to come. As we face these new challenges, Peter Vala, general manager partnerships and distribution at Thinktank, asks how SMEs will pivot to adapt to the changing environment – and what opportunities are emerging THINKTANK AT A GLANCE

2006 The year Thinktank was formed, with an aim to provide a superior range of borrowing options and service for SME businesses and commercial property investors

$2.5bn Since then, Thinktank has been able to meet the needs of borrowers throughout Australia by writing more than $2.5bn in loans

$1bn Thinktank has issued over $1bn in AAA-rated bonds (by Standard and Poor’s) to Australian and international institutional investors

125+ years Between them, the five members of Thinktank’s executive team have over 125 years of banking, finance, securitisation and capital markets experience gained at leading global institutions

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world, especially the SME sector, has been shaken like never before.

Cash has always been king for all SMEs, and cash flow has never been more important than in the current environment. This is when a trusted broker and lender are worth their weight in gold.

One of the key priorities for brokers should be working with their SME clients to explore ways to preserve and improve cash flow.

These should be carefully considered in order to address the individual circumstances of each client, such as restructuring debts from aggressively amortising loans to longer-term facilities; converting facilities from principal and interest arrangements to interest-only monthly payments; consolidating facilities to reduce monthly repayments; and releasing equity for capital purchases. Every option between these and others should be on the table.

At Thinktank we can help brokers and borrowers work through their options. Our commercial property loan terms are geared towards helping borrowers maximise their cash flow and equity, and we work hand in hand with our brokers to produce flexible and workable solutions for SMEs. A number of other issues and opportunities are emerging, with one consideration being greater credit scrutiny.

A key feature of the COVID-19 environment is the increase in ‘real-time’ credit assessment.

Traditionally, lenders have looked at historical income from secured property as one of the main criteria when doing serviceability THE

calculations. But in today’s unsettled climate this may no longer provide a clear picture, especially where business revenue may have decreased and/or increased, depending upon the industry or sector the SME borrower is active in.

Producing additional supporting financial information may now be required in the form of debtor/creditor ledgers, ATO portals and bank account statements to substantiate the current trading performance and cash position of a business moving forward.

Financial statements might show healthy amounts owing in accounts

commercial property sector turning from a lessor to a lessee market, in which the tenant has more power to drive the end rent of a property.

As we know, out of a crisis always comes opportunity. Those SMEs with borrowing capacity will be well placed to take advantage of any short-term pressure on commercial property values.

What are some of the other opportunities that SMEs can look towards with a positive lens?

The way we work during isolation has presented tremendous challenges but also opened up new ways of operating. This

We work hand in hand with our brokers to produce flexible and workable solutions for SMEs receivable, but how many debtors are paying on time or perhaps even paying at all?

Again, having trusted advisers, such as a broker, lender and accountant, will be critical for SMEs to work their way through all of these more stringent conditions.

With the dramatic changes in the economy, available funds have been diminished for a host of purposes, including the purchase of commercial property. This has near- and medium-term implications for property values.

Commercial property rentals have also been impacted due to many leases being renegotiated and vacancy rates increasing as businesses close their doors.

This may result in parts of the

could have a significant impact on organisational and property decisions moving forward.

Does working remotely work, and will embedding a more flexible structure be better for the business?

Can we downsize? Or for a business that requires their team to be under the one roof, do we need larger premises to maintain safe distancing?

Yes, all these questions present their own challenges. But they could also pave the way for a more productive, safer and happier workforce.

If an SME has the means, there may well be the opportunity to acquire freehold assets at fair market, or even temporarily reduced values, for investment or to house their own business.

www.brokernews.com.au

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25/05/2020 9:02:54 AM

In partnership with

Peter Vala, general manager partnerships and distribution, Thinktank

Out of a crisis always comes opportunity; those SMEs with borrowing capacity will be well placed to take advantage of any short-term pressure on commercial property values It could also be the perfect time to look at refinancing to open up cash flow and funds for investing, particularly within an SMSF. At Thinktank, we know how difficult it is to navigate through tough economic times, especially for SMEs. Our own business was

formed shortly before the GFC hit in 2007.

It’s why we have structured our commercial property finance solutions to provide the greatest flexibility and choice for borrowers – a factor that is particularly important right now.

Our view has always been to allow borrowers to seek funding over the longest term possible. This allows repayments to remain as low as they can be, and if circumstances change it provides the ability to pay off a loan quicker if the borrower desires to do so.

We are seeing many borrowers take up our 25-year loan terms (30 years on request) to lower their monthly loan repayments and improve cash flow. We do offer shorter terms, but as part of a longer-term facility. We believe this structure provides greater assurance for borrowers in the event that plans to pay off a short-term loan do not eventuate. Who saw COVID-19 coming?

Our non-revaluation policy is another way of providing greater comfort and security for SMEs. It means that if property values start to fall, provided a customer’s loan repayments remain up to date, there are no technical defaults or revaluation requirements needed.

Similarly, our ‘no annual review’ policy allows customers to focus solely on their business rather than continually having to prove their financial position for no benefit. Provided a customer’s loan repayments remain up to date, there is no need to worry if their 2020 financial statements have fallen short on previous years because of COVID-19.

Ultimately, we know there are many more challenges to face in the weeks and months ahead.

It will be more important than ever to work as one in responding to these challenges, whether that’s as an SME, broker, lender, landlord or investor.

These are unique times. They call for unique solutions backed by experience.

We’re ready to help. For any advice or to discuss a specific situation, please talk to your Thinktank relationship manager today. AB www.brokernews.com.au

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25/05/2020 9:03:29 AM

PEOPLE

Have an interesting deal?

Had a particularly difficult or interesting deal? Why not share it with us? Email:

sarah.megginson@keymedia.com

BIG DEAL

Consolidating debts is fairly straightforward, but this amalgamation of over a dozen facilities even surprised long-time broker Ken Stephens, founder of KT Financial Services THE FACTS

Client Couple in a de facto relationship

Loan size $606,000; 30-year term

Goal To refinance and consolidate a number of credit cards and personal debts

Location Brisbane

Lender MyState Bank

Aggregator Interactive Mortgage and Finance/Connective

three months’ worth of statements, and each statement was three or four pages long, so multiplied by eight credit cards and four personal loans it was reams of paper.

Along the way, the client’s partner did say a few times, “Hmm, I didn’t know about that debt.” That happens sometimes; I’m not trying to say that people hide things from their partners on purpose, but sometimes they’re just too ashamed to reveal it all.

I then had to sit down and tell the client, this is it – if you go down this track again, you won’t be able to refinance again, or if you do, it will be at a much higher interest rate.

THE TAKEAWAYS

six months, I would hate to see what position she would be in now. She was very stressed, and I think if she hadn’t taken action on her situation she could have fallen so far into arrears that we may not have been able to help her.

THE SCENARIO

I’ve been in the industry a long time, and I arrange business finance, vehicle and equipment finance, as well as residential loans. But this particular refinance is probably one of the hardest residential loans I’ve ever done.

I knew the borrower through her parents, who I’d helped with a loan many years prior, and I’d arranged a mortgage for this client and her former husband about five years earlier as well. They had split up and I hadn’t heard from her for a while, then she approached me and said she wanted to refinance her home following the divorce.

Sounds straightforward, right? Well, this one involved a home loan that was split into two facilities, together with four personal loans and eight credit cards – all rolled into one mortgage.

We were working with multiple lenders: Westpac, Citi, NAB, Virgin and more.

The borrower had fallen into a financial mess following her divorce. She told me the split was very messy and she had been scrambling to find any sort of funds to live off, which explained her multiple personal debts.

She had ended up in this very complicated financial situation, but the debt wasn’t all hers. Her new partner had some debts also, and they were joining forces financially and rolling all of their credit cards and personal loans into the one mortgage.

By the time she reached out to me, she was robbing Peter to pay Paul all the time. I don’t how she kept track of all the different due dates. She contacted me at the right time; if they had left it another 22

THE SOLUTION

A lot of lenders wouldn’t even touch this refinance because of how complicated it was. However, once I explained the situation in detail, I found some lenders who were willing to come to the party.

The client had some equity in property, so the final loan amount we were

This deal took place around 12 months ago, when it was much easier to get credit.

The industry has tightened things up, and it’s far harder now to get into this sort of trouble with credit cards and loans. A few years ago, it was so easy to obtain credit, and this shows how detrimental that can be to your life.

The couple’s relief at how much money they were going to save was palpable.

I think in the end we reduced their monthly obligations by $2,000–$3,000.

They could never have got ahead with that noose around their necks, and today they are so much better off. They also have a plan to pay off the loan as quickly

This one involved a home loan that was split into two facilities, together with four personal loans and eight credit cards – all rolled into one mortgage

Ken Stephens Founder, KT Financial Services

requesting came to 80%, which was good as that meant no lenders mortgage insurance was payable. Ultimately, with their two incomes it all still serviced. It was a matter of finding a lender that didn’t perceive the client’s messy financial affairs to be high-risk.

Fortunately, we didn’t have to go to a lender that was charging higher rates, as with a bit more research I was able to talk to the BDM at MyState, who confirmed we could get it across the line.

In the end, it took about five months to get it all sorted, as there was so much paperwork involved. The banks needed

as possible so they are not paying these credit card debts for over 30 years.

Obviously, not all of my clients are like this, but this is a great example of what broking is all about and the assistance we can offer to the public, who won’t get the same result if they only go directly to their bank.

As brokers, we can imagine these clients going into a bank and the bank saying, “No, sorry, we can’t help you”. But what we can do as brokers is search for a number of options and provide solutions that a customer can’t always access by going straight to the lender. AB

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25/05/2020 9:04:23 AM

FE AT URES

OPINION

CAN YOUR STAFF REFUSE TO RETURN TO WORK? As Australia begins its return to ‘the new normal’, it’s important that brokers decide on their strategy regarding employees returning to work. They must consider the legalities when it comes to the question: can staff refuse to return if you tell them it’s time to come back to the office? the beginning of May, Prime Minister Scott Morrison announced Australia’s ‘3 Step Framework for a COVIDSafe Australia’.

As businesses move towards recommencing their normal operations in accordance with the framework, employers will be asking their employees to return to the workplace.

In some cases, a business cannot operate without its employees being physically present at the premises: a restaurant cannot serve meals without wait staff, just as a shop cannot sell goods without shop assistants. But in office environments where face-to-face contact with others isn’t critical, the timing of a return to the workplace may not be so clear-cut. To survive during the pandemic, businesses have had to move to models that allow work to be performed remotely and with increased flexibility – and some employees may want it to stay that way.

Being able to throw a load of washing on while waiting for the kettle to boil, saving hours on the commute and still hitting work targets has been seen by some as a new and better way to work.

Following positive feedback from employees and a realisation that fewer bodies in the office may save on commercial rent, cleaning, heating/cooling and other incidental office costs, some employers have already determined that a number of their employees will make working from home a new norm.

Before an employer directs its employees to return to the workplace, it must ensure that a ‘COVIDSafe plan’ has been developed, taking into account the public health orders in place at the time to avoid breaching restrictions. At present, this would require any COVIDSafe plan to include measures for physical distancing and, in some workplaces, the four-square-metre rule.

As a result, the employer may need to relocate desks to facilitate 1.5m distancing

between employees, or, where an office cannot be easily rearranged, have teams of employees attend the workplace in shifts so fewer staff are present at any one time.

Employers must also ensure they provide a safe working environment to comply with work health and safety laws.

COVIDSafe plans must cover systems and processes for maintaining effective hygiene, monitoring the health of employees and visitors to the workplace,

AT

to be in the office to supervise others or need to be supervised themselves, and whether the employee has to interact with co-workers and clients face-to-face.

Ultimately, if the employer wants the employee back in the workplace, they can direct the employee to return. Any refusal to follow a reasonable directive could have disciplinary consequences.

Employers should consider whether the way their employees travel to work will

Being able to throw a load of washing on while … saving hours on the commute and still hitting work targets has been seen by some as a new and better way to work

Erin Kidd Special counsel, Employment Law Group, McCabe Curwood

and ensuring satisfactory cleaning.

Some organisations have already flagged that certain members of their workforces will continue to work from home following the end of the pandemic. They have realised that reducing the number of employees at their premises may result in bottom-line savings on workplace costs when weighed against the costs of facilitating work from home, such as ongoing costs for more sophisticated IT systems.

But what if an employee refuses to return to the workplace once they have been told, “It’s time”?

Employers will need to carefully consider the circumstances of any such refusal.

Where a proper COVIDSafe plan has been developed and any employee can safely travel to and from work without a great deal of disruption, it largely becomes a matter of employer discretion as to whether the employee can continue to work from home.

Relevant matters to consider include the employee’s level of productivity at home versus in the workplace, whether they need

be affected by COVID-19 restrictions.

For example, while public transport services are affected by social distancing, it may be impractical for employees to return to the workplace.

Those employees with disabilities or carer responsibilities will also require additional consideration by the employer if they cannot legitimately return to the workplace due to matters related to COVID-19, or in circumstances where they submit a formal request for flexible working arrangements under the Fair Work Act. Hasty decisions by an employer with respect to those employees may give rise to a breach of employment and discrimination laws, so care must be taken and obtaining legal advice is often a good idea.

At the end of the day, the health and safety of employees is paramount. However, if it is safe for employees to return to the workplace, the employer can decide for itself whether to allow an employee to continue to work from home, both as we emerge from lockdown and into the future. AB www.brokernews.com.au

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23

25/05/2020 9:05:26 AM

PEOPLE

Get involved in the discussion Share your thoughts at

brokernews.com.au

FROM THE FORUM

Top comments from trending stories on brokernews.com.au

MAJOR BANKS COMMIT TO SWIFT TURNAROUND TIMES

AUSSIE ANNOUNCES AGGRESSIVE EXPANSION PLANS

A couple of major banks have announced a series of changes to their consumer credit policies. Westpac aims to continue helping customers purchase properties in a “responsible and sustainable way” throughout the COVID-19 crisis via a change to its income verification process. As of 30 April, all PAYG and casual employees must provide more recent proof of income for servicing a prospective loan. Under the updated policy, the latest payslip or other relevant document must be no more than 14 days old, or one month old for monthly pay cycles, at the time of application submission. Further requirements are being introduced for self-employed income verification as well.

In order to verify income for all self-employed applications, additional documentation is required, including last quarter BAS, the BAS from the corresponding quarter the year before, and the last three months’ bank statements and transaction summaries. There are then three new conditions that must be met, in order to proceed with assessing the application. Meanwhile, CBA has doubled down on its commitment to speedy turnaround times, declaring the efficient processing of client enquiries as its “key focus” during the COVID-19 pandemic.

Aussie has announced major expansion plans, aiming to recruit 200 new brokers in 2020 and increase its retail stores to 300 nationally by 2023. The group says it’s looking to recruit talent from various backgrounds to expand its network of brokers across Australia and is talking to executives and small business owners who are looking for a professional change. The group will offer cash flow support to each successful recruit over their first six months, according to Aussie CEO James Symond, who says, “We believe providing our newest brokers remuneration during this period will help give them the kick-start they need to become successful and long-term brokers with Aussie.” Announcing growth plans during the pandemic is always positive, but what has the broker response been like?

I’ll let the brokers who are happy for their client’s application to sit in a queue for 31 business days worry about this.

No thanks

What a stark contradiction to CBA’s attitude to brokers during the royal commission. Now that bank staff and some branches are closed due to COVID-19, they are supportive and thankful of the support of the broker channel in bringing in business. Just goes to show how two-faced the bank can be when it suits its own selfish needs. I wait to see the turnabout face once COVID-19 is over and they have their full branch facilities back.

I support the Broker Industry

24

I’ve always wanted to know why Aussie keeps having to recruit new brokers. Is it because of an extra income source from the new recruits who pay a sign-up fee? Is it because they offer a low commission so the average broker is unable to make a reasonable income and leaves? So why, Aussie, don’t you put more resources into the success of your existing brokers, and I don’t just mean the ones you perch on the pedestal either (every aggregator has those). How about better commission splits for leads supplied and self-sourced, ongoing leads regardless of broker status. Get rid of your restrictive contract and allow a broker to pay an agent or accountant for a lead. Example: be more like Loan Market!

This is just my opinion, but if you made the effort to ask why so many of your brokers leave within the first three years, you might be surprised.

SydneysideB

Great: more unqualified and inexperienced people being enticed into the industry so a struggling aggregator can make more money selling franchises. Yuk. Harry

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24_AB1710_Forum_SUBBED.indd 24

25/05/2020 9:06:06 AM

PEOPLE

Do you have a question for our broker mentors?

Email your question to:

sarahmegginson@keymedia.com

BROKER ON BROKER Narelle Kerstan, owner of Gloss Finance, is one of Hobart’s busier mortgage brokers. Despite a substantial drop in enquiries, she has plenty to keep her busy as she is using this time to focus on working ‘on’ the business rather than ‘in’ the business

You’ve been in the industry for 25 years, working for 15 of those years as a broker. Is this pandemic the wildest ride you’ve experienced in the industry? is the biggest shift I’ve ever A This seen or experienced, absolutely, and it’s the one that has had the biggest impact. Everyone was stressed out about the royal commission in the last few years, and about all of the legislation changing, but I don’t stress about things like that – it is what it is; we have to accept it and see how it

Q

volume we do with just the two of us, so I’ll actually be looking at getting someone else to assist us going forward.

Would you say you have experienced any benefits due to the pandemic?

In some ways, yes. Because of A coronavirus and the economic slowdown, I’m not taking work home until 11pm at night any more. I’ve slowed down a lot. We’ve made some positive changes at the office, things like my PA, Toni, and I are actually

Q

“I’ve just sent a personal email to my database, and that generated about 10 to 15 enquiries alone. Working on your database is so important” pans out. But something like this is impossible to prepare for or predict, and it impacts everyone.

What has been the biggest impact COVID-19 has had on your business?

I’m one of the lucky ones.

A Having been in the industry so long means I have a decent trail commission, and I’ve still got plenty of work to keep me busy. I only have one staff member, and we have more than enough work that I don’t need to reduce her hours. I work with Specialist Finance Group as well as PLAN, and they cannot believe the

Q

taking a break for 30–40 minutes at lunch and going for a walk. I never would have done that before, when I was madly working 60 hours a week.

Now I’m working closer to 40 hours a week, and when I’m at my desk I’m busy, but when I go home I switch off.

What advice would you give to brokers who are experiencing a drop in activity and looking for ways to optimise their business?

You do all of these things in A the first few years of business, but then as you get busier they fall by the wayside. I’ve just sent a

Q

Narelle Kerstan, director, Gloss Finance

personal email to my database, and that generated about 10–15 enquiries alone. Working on your database is so important. I’d like to go in and look for any clients that I haven’t seen in five years or more, and I plan to get on the phone to

them so they know that I’m still here and I still care. You can miss out on the chance to provide that personal touch when you get to this busy point in your business, but this is a relationship-based business, so it’s crucial to keep in touch. AB

PITSTOP MENTORING Are you new to the industry, or simply keen to learn from experienced brokers who have words of wisdom to share? This is your opportunity for pitstop mentoring! If you have a question you’d like a senior broker to answer, contact us and look out for an expert answer in a future issue.

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25

25/05/2020 9:07:01 AM

DATA

SOUTH AUSTRALIA

WA SPOTLIGHT

Adelaide prices rise in spite of falling housing activity due to COVID-19 An annual growth rate of 2%-plus across Adelaide’s housing market has raised values to a new median price following nearly a seven-year run of slow but steady increases, according to Domain’s House Price Report for March. The unit market hasn’t performed quite so well, with both metro and country apartments recording a slight loss over 12 months.

Director at National Property Buyers Katherine Skinner says there has been a rise in investors wanting to take a back seat due to COVID-19, though some are still looking to take advantage of a less competitive climate.

“April definitely saw a drop in investor sentiment across the market, with unemployment rising rapidly and concerns over just how long the economic downturn will draw out due to COVID-19,” Skinner says. “Publicly advertised stock levels were almost non-existent.”

Despite the uncertainty, house prices continued on the uptick, with CoreLogic reporting a slight rise in values in April.

Area

Median

Quarterly

12-month

Weekly

Gross

price

growth

growth

median

rental

rent

yield

Metro (H)

$471,000

0.4%

2.7%

$385

4.3%

Metro (U)

$322,250

-1.4%

-0.6%

$330

5.1%

Country (H)

$281,550

0.0%

2.0%

$270

5.1%

Country (U)

$218,000

0.0%

-0.5%

$210

5.2%

NEW SOUTH WALES

As the greater economy hangs in the balance, Sydney prices hold their own

Median

Quarterly

12-month

Weekly

Gross

price

growth

growth

median

rental

rent

yield

Metro (H)

$905,000

1.1%

-2.1%

$550

3.1%

Metro (U)

$703,500

0.0%

-2.8%

$525

3.9%

Country (H)

$490,000

1.1%

2.1%

$400

4.3%

Country (U)

$430,000

1.8%

3.2%

$350

4.3%

26

Perth’s marathon effort to regain market growth may be put on hold by the pandemic a 0.2% increase in property values over April, Perth was one of the few capital cities to surpass its average six-month growth rate, according to CoreLogic’s Home Value Index.

For the WA capital, the recovery over the past few years has been a slow burner, with its strong will to lift itself out of a five-year-long decline overshadowed by high unemployment and a sluggish local economy.

Domain’s House Price Report for the first quarter of 2020 shows that values are currently around 14.4% below the peak experienced in late 2014. Nevertheless, the capital has “regained 1 per cent from the 2019 trough”.

While steady progress has been made since the start of the year, this is likely to be disrupted by the economic impact of the health crisis.

The number of new listings slowed from late March and sales activity is expected to drop, RECORDING

but “this will be counterbalanced by the shrinking supply”, Domain’s report states.

Damian Collins, president of the Real Estate Institute of WA, says, “With the current median house price sitting at $477,000, it is positive to know that despite the current economic conditions, sellers are not being forced to sell and lower their sales price to do so.”

“Another positive for sellers this month is that it is quicker to sell a house now than it was a year ago, with the median days to sell sitting at 65 compared to 77.”

According to Domain’s Rental Report for March, Perth is also the most affordable rental market. “This month we saw Perth’s median rent lower slightly to $350 per week; however, if we break this down into units and houses, the unit median remained stable at $340 per week and the house median lowered only $5 to $375 per week,” Collins says.

PERTH HOUSING STATS – APRIL 2020

Since restrictions on public auctions came into effect nationwide in March, the pool of properties being sold off-market in Sydney has grown.

“The property market was powering along in February, and auction clearance rates were tipping 80%,” says Rich Harvey, buyer’s agent and CEO at Property Buyer. “But then COVID-19 hit during March and consumer sentiment plummeted along with auction clearance rates, which dropped to 35% due to large volumes of properties being withdrawn from auction.”

Despite a shift in how properties were being transacted, Sydney values stayed in positive territory, rising by 0.4% over April and 3.2% over the quarter, as per CoreLogic’s Home Value Index.

“There is always a lag effect with figures, and I expect to see modest price declines in the next few months. The lack of listings is having a counterbalancing effect and holding up pricing as there continues to be a lack of stock over the next few months,” Harvey says.

Area

UPHILL BATTLE CONTINUES

Sources: Real Estate Institute of Western Australia, May 2020; *CoreLogic Hedonic Home Value Index

40%

1,277

0.2%

drop in volume of property sales

number of homes sold

increase in median property values*

6

65

77

number of months in a row that values have increased or stabilised

median number of days a property currently sits on the market

median number of days a home sat on the market 12 months ago

SUBURB TO WATCH: NORTH FREMANTLE Median price (houses) $1,150,000

Median price (units) $777,500

12-month growth

3-year growth

Average annual growth

Indicative gross rental yield

5%

20%

4.7%

3%

12-month growth

Average annual growth

Weekly advertised rent

Indicative gross rental yield

-8%

1.3%

$530

4%

www.brokernews.com.au

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25/05/2020 9:08:19 AM

AUSTRALIAN CAPITAL TERRITORY

Property values in Canberra remain firm, but demand for rentals dips While greater economic forces impact the market, Canberra has managed to remain in its stable position as the city’s strong employment levels shield it from a downturn due to the pandemic.

CoreLogic’s Home Value Index reports that values remained largely unchanged throughout April, although higher supply and softening demand have impacted rental conditions.

Canberra’s rental market has emerged as one of the most affected in the country, with a 0.7% decline in rents.

The past four and a half years have seen year-on-year growth in Canberra’s rental market, making it one of the most expensive capitals for renting a house, according to Domain’s Rental Report for March. However, the report adds, “Given the current situation is unprecedented, if rentals become vacant in large numbers, it could result in rent prices falling.”

Canberra’s rental yield for April remains strong, as per CoreLogic data, which indicates just a minor dip from the previous month.

Area

Median

Quarterly

12-month

Weekly

Gross

price

growth

growth

median

rental

rent

yield

Metro (H)

$695,000

0.7%

3.3%

$580

4.4%

Metro (U)

$444,500

0.7%

1.2%

$480

5.7%

NORTHERN TERRITORY

Darwin sales volumes drop as city continues to record limited price movement

HIGHEST-YIELD SUBURBS IN WA Suburb

Dwelling

Gross rental

Median

Quarterly

12-month

Average

type

yield

price

growth

growth

annual growth

SOUTH HEDLAND

H

11%

$207,550

-1%

8%

-6.4%

KAMBALDA WEST

H

11%

$108,500

1%

19%

-4.3%

DERBY

H

10%

$150,000

0%

15%

-4.1%

PINGELLY

H

10%

$131,250

-5%

38%

1.1%

BOULDER

H

9%

$177,500

-6%

-11%

-4.3%

MOORA

H

9%

$150,000

-6%

-17%

0.3%

BROOME

U

9%

$211,250

-9%

-22%

-3.7%

SPALDING

H

9%

$125,000

-2%

4%

-6.7%

SOUTH KALGOORLIE

H

9%

$205,000

-7%

-15%

-2.5%

BILINGURR

H

7%

$425,000

-15%

-13%

48.9%

In the midst of a softening market nationally, Darwin continues its long-term trend of recording negative to nil capital growth across the board.

But while the COVID-19 crisis has exerted price pressures, Quentin Kilian, CEO of the Real Estate Institute of the NT (REINT), spotlights the extent to which the Top End’s market has adapted to the changed conditions.

According to the REINT’s Real Estate Local Market Report for the March quarter, sales volumes dropped by 27%. “But the good news is that they are still some 12% above the same time last year,” Kilian says, with equally good news being the city’s stable median price, sitting at $470,000.

Alice Springs has also experienced a considerable decline in volume of 28.6% for the quarter, but values still showed an improvement of 1.6%, the report states.

“For Greater Darwin, volumes fell 14%, but that is still 34% higher than this quarter last year,” Kilian says.

Area

Median

Quarterly

12-month

Weekly

Gross

price

growth

growth

median

rental

rent

yield

Metro (H)

$470,000

-0.9%

-4.9%

$480

5.4%

Metro (U)

$326,250

0.0%

-11.2%

$370

6.4%

Country (H)

$440,000

0.6%

-4.7%

$500

6.3%

Country (U)

$284,000

-4.8%

-6.3%

$373

6.5%

www.brokernews.com.au

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25/05/2020 9:08:54 AM

DATA

QUEENSLAND

Brisbane’s leading drivers of growth could be compromised by the virus According to Domain’s House Price Report for March, values in Brisbane stabilised over the first quarter of this year, with the city remaining very affordable compared to its counterparts to the south, recording a median price of just over half a million dollars.

“The low cost of debt, improved credit access and borrowing capacity had helped to entice demand and absorb supply,” the report says.

Melinda Jennison, property investment adviser and managing director at Streamline Property Buyers, says Brisbane’s values prior to the virus were being pushed upwards due to buyers considerably outnumbering sellers. However, more recently there has been “a real drop-off in demand”.

“We have seen a real shift in sentiment, and a lot of buyers, particularly investment property buyers, are taking a wait-and-see approach,” Jennison says, noting that this is likely to be the result of “short-term uncertainties”.

Median

Quarterly

12-month

Weekly

Gross

price

growth

growth

median

rental

rent

yield

Metro (H)

$535,000

0.0%

1.1%

$420

4.0%

Metro (U)

$385,000

0.0%

1.3%

$395

5.3%

Country (H)

$441,000

0.0%

1.1%

$400

4.7%

Country (U)

$380,000

1.1%

0.0%

$350

4.9%

The combined capital city preliminary auction clearance rate bounced back above 60% this week for the first time since late March, with 64.5% of homes selling. The higher clearance rate was across a lower volume of auctions over the week, with 473 scheduled, down on the 612 auctions over the week prior when a preliminary clearance rate of 59.6% was recorded, which later revised down to a final result of 47.5%. Of the 333 results collected this week, 22% returned a withdrawn result, well below the withdrawal rate of 56% recorded a few weeks ago when a much larger number of auctions were scheduled to proceed. The lower withdrawal rate is the main factor driving an improvement in clearance rates. With news over the week that the ban on onsite auctions and inspections as a result of COVID-19 will now be lifted in NSW, WA and more recently SA and Queensland, alongside a broader relaxation of social distancing policies, there’s likely to be a lift in confidence and volumes over the coming weeks.

Total auctions

21

Cleared

12

Uncleared

8 61.9%

Clearance rate

PERTH Total auctions

7

Cleared

1

Uncleared

6 14.3%

Clearance rate

Houses

$900,000

Median

Quarterly

12-month

Weekly

Gross

price

growth

growth

median

rental

rent

yield

$0

Capital city

$462,500

$680,000

Melbourne

-0.1%

-0.5%

2.5%

12.5%

Brisbane

0.0%

0.2%

2.0%

4.1%

Adelaide

0.2%

0.4%

1.1%

1.6%

0.0%

0.0%

1.1%

-2.5%

0.0%

-0.1%

3.1%

10.2%

5.3%

Perth Combined 5 capitals

5.2%

$450,000

14.8%

$400

5.2%

$388,500

4.4%

8.0%

$270

$487,500

0.1%

0.6%

$325

$349,000

0.0%

$399,000

3.5%

$418,000

Sydney

Metro (U)

8.3%

Canberra

12-month change

4.8%

1.6%

Darwin

Year-to-date change

$460

1.5%

Hobart

Monthly change

8.7%

$339,500

Perth

Weekly change

3.1%

$289,000

Adelaide

CAPITAL CITY HOME VALUE CHANGES

$540,250

Country (U)

Sydney Melbourne Brisbane

$322,000

$100,000

$444,000

$200,000

$422,500

$300,000

$500,000

$500,000 $400,000

$555,000

$600,000

$670,000

$700,000

Metro (H)

Country (H)

Units

$800,000

$676,000

House prices in the state capital started to veer into negative growth territory in March, though they recorded surprising growth of 2.2% in the first quarter of 2020, according to CoreLogic.

“Hobart has the most exposure of any capital city, at least proportionally, to the industry sectors most heavily impacted by COVID-19 in terms of employment, with 12.7% of the workforce employed within accommodation and food services, and arts and recreation services sectors,” says CoreLogic’s head of research, Tim Lawless.

Domain’s House Price Report for March mirrors this outlook, stating, “It is likely Hobart will be more exposed to the economic shock of the coronavirus pandemic than other Australian cities.”

New listings began to drop in mid-March, the report states. Furthermore, buyer activity is expected to wane as many households lose income sources, while low wages coupled with the steep growth in values of recent years could see regions with higher loan-to-value ratios “more exposed to mortgage defaults”.

$282,500

Buyer activity is expected to diminish in Hobart as incomes take a hit

28

ADELAIDE

MEDIAN HOUSE AND UNIT PRICES

TASMANIA

Area

WEEK ENDING 11 MAY 2020

$835,500

Area

CAPITAL CITY AUCTION CLEARANCE RATES

*The monthly change is the change over the past 28 days

www.brokernews.com.au

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25/05/2020 9:09:23 AM

BRISBANE CANBERRA Total auctions

34

Cleared

31

Uncleared

13

Total auctions

16

Cleared

8

Uncleared

8 50.0%

Clearance rate

61.8%

Clearance rate

SYDNEY Total auctions

144

Cleared

102

Uncleared

42 70.8%

Clearance rate

TASMANIA

MELBOURNE Total auctions

116

Total auctions

0

Cleared

70

Cleared

0

Uncleared

46

Uncleared

0

Clearance rate

Clearance rate

60.3%

VICTORIA

Area

n.a.

Median

Quarterly

12-month

Weekly

Gross

price

growth

growth

median

rental yield

rent

Melbourne was on a steady path of rising capital growth – until COVID-19 As record-high values have begun to moderate across Melbourne, the effects of the pandemic threaten to thwart the capital’s quarter-on-quarter gains. CoreLogic reports that values dropped by 0.3% in April, signalling “the sharpest reversal in growth conditions” of all the capitals. The Domain House Price Report for March shows that values had risen over four consecutive quarters, with metro unit prices reaching a median of $570,000 and house prices topping $725,000.

“Like Sydney, Melbourne had been experiencing year-on-year price growth rates of around 5% and quarterly growth … prior to the COVID-19 outbreak,” says Brendan Kelly, director of Property Predictions. “It is likely that full-year growth rates will climb … once conditions improve.” Meanwhile, Real Estate Institute of Victoria president Leah Calnan says the state government’s decision to allow onsite auctions and open for inspections to restart in Victoria with restrictions will “inspire increased confidence in our economy”.

Metro (H)

$725, 000

1.1%

0.4%

$430

3.1%

Metro (U)

$570,000

1.6%

7.1%

$430

3.9%

Country (H)

$388,000

1.9%

5.6%

$350

4.8%

Country (U)

$299,975

1.7%

9.3%

$280

4.9%

Source: Except where otherwise stated, all data sourced from CoreLogic, May 2020

www.brokernews.com.au

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25/05/2020 9:09:52 AM

PEOPLE

IN THE HOT SEAT

Deanna Ezzy lucked into a broking career after she decided that property was the industry for her, and applied blindly for every job that was even vaguely related to real estate. That’s how she met her mentor, and 10 years later she says there’s nowhere else she’d rather be

How did you get into the mortgage broking industry?

When I started out as a broker, I’d reached a point in my former A job where I knew there was just nowhere to go. I remember walking around the block, thinking: what is something that really interests me? Not just a job but a career path. I owned one investment property at the time and thought, OK, let’s look at something to do with property. I started to apply for any and all jobs that had anything to do with property. It was a fluke that I stumbled into this industry – and that I enjoyed it and was good at it.

Q

Did you work with someone initially who took you under your wing?

I’ve had amazing mentors over the years, and it’s taken me a A long time to catch up to their way of thinking about me.

I would hear my old boss, Ed, say to clients, “You’ll love Dee. She’s the queen of communication.” And I would think, “He’s lying! I am not!” It took me about three years before I actually believed him and realised, hmm, I’m quite good at this!

Q

Do you aim to pay it forward by being a mentor yourself? now that I’m a boss, running More Than Mortgages, A IYes, want to be just as good a mentor to my team as the ones I’ve had over the years. Broking has really changed my life. I’d never been in the position to earn decent money before. I grew up in a very low socio-economic household where there was domestic abuse, and I was an only child, so I had to go through that all on my own. We had no money, no car for three years. This industry has changed my whole way of thinking. In the last 10 years my life has completely changed trajectory.

I look at myself and say, “Who am I?!”

Q

Q A

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What has surprised you most about the broking industry?

I think broking is an incredible industry, and what you can actually achieve is limitless. There can be one million things that need to be

done, and that can feel overwhelming at times. But if you learn to focus and you’re prepared to put in the hours, there is the capacity to be able to earn a really decent income. I have a friend who is a neuropsychologist.

She studied at uni for seven years and the max she could earn in Canberra was $130,000. Broking offers much greater income potential; it is a huge opportunity to sink your teeth into something that can be rewarding in so many ways. AB

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