Broker registrations are well under way with ASIC, in preparation for Australian Credit Licensing in July.  From all reports, most have found the process easy to complete and not too time consuming.  For those who haven’t registered yet and need to, best to get this out of the way early, to save any last minute rushes.

We are starting to receive supplier requests to provide details of our registered brokers, so it’s important to remember if you’re not registered with ASIC before 30 June (or appointed a credit representative) you will have your accreditations cancelled.  To enable us to collate and report to our suppliers, we are asking for registration to be completed and details supplied to us by the end of May.

Once registered, there is still plenty of time to determine which is the best model to move forward – own licence or credit representative.  We are currently finalising procedures, costs and requirements for brokers to make an informed decision.  There is still a level of detail to be advised and understood by industry in this regard.  The ongoing compliance requirements and costs appear to be the main determining factor in what is the best way forward for each business.  Discussions with agreement holders still undecided are continuing.

A number of nMB brokers have been randomly contacted by ASIC as part of the regulator’s program to better understand the workings of the broker market they will soon commence regulating.  From all reports, it seems ASIC is taking a very proactive and moderate approach in moving into the mortgage space.  I was really comforted to hear from one broker who uses our “nMB Loan Selector” as part of her fact find process that ASIC was very pleased that this process was already built into a broker’s business practices.

Positive news for home buyers in the last few days with the federal government announcing changes to rules for foreign investors.  Temporary residents will now have to seek Foreign Investment Review Board approval to buy property and realise the assets upon leaving Australia.  Purchases of vacant land will require construction within two years.  There is no doubt the changes made to FIRB rules in December 2008 – which are now being reversed - have played a large part in pushing house prices up, and making housing affordability a real issue for many local buyers, particularly first home owners.

During the past month we have negotiated with ING Direct to make available accreditation to all nMB brokers who wish to offer ING Direct products.  This is a very pleasing outcome as ING Direct took the time to look at our business and better understand our internal processes in broker recruitment and management.

nMB Direct is continuing well in its first full month since launch.  We have 50 brokers accredited and have settled our first loans.  The relationship with The Rock Building Society is developing really well and our two businesses are a great fit with each other.

Until next time, stay well!

Gerald Foley - Managing Director
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Emerson once coined the phrase, “Build a better mousetrap and the world will beat a path to your door.”  But regardless of how effective his new mousetrap was, it failed to sell.  The main reason it failed to sell was a lack of marketing.  This landmark event gave birth to the term “Marketing Myopia”.  Marketing Myopia is a terminal disease suffered by businesses that get too caught-up in the technical aspects of their product or service.  So much so, they lose sight of what the customer actually needs or wants or fail to connect with their target audience.

A classic case in point is the Betamax vs. VHS video cassette recorder wars.  Sony’s Betamax technology was far superior, but JVC won the battle - their secret weapon, marketing!  JVC advertised and promoted their system in every possible way and made their product easily accessible.  Sony on the other hand, focused on positioning their product at the high end of quality and after 13 years, only held a share of 12% in what was an oligopolistic market.

Companies with a solid marketing focus pinpoint what their target audience needs or wants before selecting the most effective channels of communication to attract new and repeat business.  So how does a humble mortgage broker working in the suburbs achieve this?  Well, in the final analysis it’s nothing more than people and stuff - people buying stuff from other people.  And it doesn’t take a marketing genius to realise that people are more likely to buy stuff from people they know, feel they know or from a brand they trust.  

So how do you build a relationship with people in your local area so they buy your stuff instead of some other mortgage broker’s stuff?  The simple answer is…..there is no simple answer.  It takes a combination of activities and it takes persistence.  As an example, let’s look at some of the activities real estate agents employ when building and maintaining a strong local presence:

  • Billboard advertising;

  • Local newspaper advertising;

  • Media releases;

  • Editorial submissions to local press;

  • Direct mail to current clients and prospects;

  • Business card drops;

  • Sponsorship of local sporting clubs or events;

  • Supply of display boards for school activities;

  • Auction services for local fund raising;

  • Attendance of local business meetings and other special interest groups; &

  • Brand-leverage.

For the most part, these activities may be replicated by mortgage brokers.  The last point although, requires more discussion. Brand-leverage is perhaps the best way real estate agents build their local presence.  Brand-leverage is achieved where the agency’s clients are paying for the cost of promoting their brand – usually in the ‘properties for sale’ section of the classifieds and ‘for sale boards’. 

But how do you as a mortgage broker engage a third party to promote your brand and your service?  Enter “Affiliate Marketing”.  Affiliate marketing is a variable cost method of advertising your business, meaning you only pay a fee once a product or service is sold.  Here’s how it works…..

An affiliate partner agrees to allow the broker to send sales messages to clients, members and associated businesses within their sphere of influence.  Although the broker would usually prepare the message, it is sent and endorsed by the affiliate.  The sales messages may be delivered via:

  • Direct mail;

  • Newsletters;

  • Seminars;

  • Messages on pay slips or invoices; &

  • Website advertising.

Affiliate Marketing usually includes a revenue sharing arrangement for sales generated by the strategy.  This is where you may leverage the nMB affiliate marketing system to handle the tracking, reporting, payment and invoicing functions of the model.  This will eliminate time-consuming administrative tasks so you can focus on prospecting and selling.  Here's a simple five step process to get you started with affiliate marketing.

1) Make a list of all the local businesses in your area that may have strong, positive and trusting relationships with their customer base.

2) Examine each of these potential affiliates to ensure there is no potential conflict with your service and determine how each may benefit from the relationship.

3) Deliver your presentation to potential affiliates by sending a one-page letter introducing your company and inviting them to consider your affiliate proposal.  Follow-up with a full written proposal clearly defining the relationship, the service proposition, their involvement in the process (should be limited and at no cost), benefits for the affiliate and their customers and the method for tracking, reporting and paying.

4) Follow-up each potential affiliate with a phone call and offer to further explain the proposal during a meeting.

5) Formalise the relationship with a written agreement that outlines the commercial terms and service levels.

Note: All the documents mentioned above are available as templates and stored in the “Broker Toolkit” section of the nMB Mortgage Broker Suite.

The nMB affiliate marketing model has proven to be extremely successful, with over 270 active affiliate accounts held by nMB brokers.  To learn more contact your nMB BDM for assistance in preparing and executing your own affiliate marketing strategy.

Sal Cinque - Director, Sales and Marketing

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certificate
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Welcome to the new Marketing Update section of nMB Intell. Each month the Marketing Update will focus on a different marketing initiative which can be implemented by your business to help achieve your objectives.  You will read firsthand how nMB brokers, as well as businesses in various other industries, have employed these strategies successfully.

The Marketing Update section of nMB Intell will also be used as a vehicle for communicating nMB’s latest marketing activities from time to time.

In this month’s Sales and Marketing Update, Sal discussed the benefits of establishing affiliate partnerships with local businesses, and outlined the steps involved in creating these relationships. This month’s Marketing Update will focus on one way in which you take advantage of these affiliate partnerships in order to grow your business.

The organisation of an industry seminar, in conjunction with one of more of your affiliates, is one such way in which you can leverage your affiliate relationships, and can prove beneficial to your business in two ways. Firstly, it acts as an effective means to keep your brand top of mind with existing clients, so when a new loan need arises you are the first point of contact.  Secondly, it provides an excellent opportunity to establish new leads via presenting to and networking with your affiliates’ client base. By working with your affiliates to organise a seminar, you can spread the preparation workload and costs, maximise the seminar’s value to attendees, as well as making the most of your referral opportunities.

Before deciding whether organising an industry seminar would likely benefit your business, it’s important to understand the ins and outs of managing such an event.  nMB broker, Greg Collins from FirstPoint - who has organised several seminars in the past - has kindly agreed to answer some key questions in relation to his experiences.

1. How do you prepare for seminars?

We hold FirstPoint branded seminars on a quarterly basis as part of our marketing strategy. Initially we approached our strategic business partners - accountants, solicitors, a real estate company and financial planners - and explained the concept of the seminar. They were very receptive to the idea, as they could easily see the referral benefits that could be realised. We encouraged each partner to try and commit to having forty of their clients attend the seminar. We mix it up by working with different strategic business partners at each seminar and usually work with at least three partners.

We project manage the event, which involves organising the venue, food and beverages, as well as coordinating the speakers. The costs of running the event are spread amongst the strategic partners, so they are quite reasonable.

A few weeks prior to the seminar, all speakers meet to discuss appropriate content.  We ensure there is a general theme, or at least compatibility between topics.

2. How do you promote your seminars?

We always draft a generic letter which is then mailed out by each partner to their client databases. The idea of using partners apart from a cost splitting stand point that complement our business is to cross pollinate our databases. We actively follow up invitees by sending out several reminder emails as the event approaches, followed by a confirmation phone call  two days out.  

3. What content have have you presented in your seminars?

We have covered a range of topics, including; Super Lending, First Home Owners information, Mortgage Insurance and Home Ownership information. We also promote products that we feel could be ideal for our clients.

4. What benefits have you seen as a result of your seminars?

It has helped to strengthen our relationship with referrers and has been a great way to acquire new leads from our trusted business partners. In terms of our existing clients, the seminars form part of our client retention strategy, helping to ensure we communicate with our clients face to face at least four times a year on top of our newsletters. The seminars provide an effective means to generate exposure and interest in our business, whilst offering value to current and prospective clients through educating and informing them.

We don’t measure the effectiveness of the seminars by how many loans we settle as a direct result. We are looking to get people talking about our brand and to keep it top of mind.

5. How do you encourage attendee feedback?

We leave a simple 3-5 question feedback form on each seat and encourage attendees to fill it out with the incentive of being entered into a prize draw to win a bottle of wine. We tend to ask questions such as;

  • Did you enjoy the topics that were presented?

  • What would you like more of, less of?

  • Did you think the timing was appropriate?

This feedback has helped shape subsequent seminars.

6. What advice would you give to a broker looking to get involved in a seminar?

  • Choose strategic partners with whom your business has an ideal fit.

  • From our experience, people tend to enjoy the real estate speakers the most. They are interested in topics such as; property hot spots, selling tips, and investment information.

  • Ensure that all partners are comfortable with public speaking and are willing to put in the work required to make the event a success.

  • Mix it up. Don’t present the same content each time. Choose relevant and interesting topics. Ensure the content is not too complicated or in depth.

  • Don’t let the seminar drag on. We only have each speaker present for about 10 - 15 minutes, so clients don’t get bored.

  • Consider inviting a speaker from a different industry to present, to try and break up the seminar. We recently invited directors from a fitness company along to discuss; lifestyle fitness, healthy minds, body and finance. We have found that a lot of inspirational people from the local community will offer their time at no cost, as it is good exposure for them.

  • The time at which the seminar is held is an extremely important determinant of attendee numbers. We find that 6:30pm is the ideal time for most people.

  • Choose a venue that is convenient and has access to cheap parking nearby. There is no need to hold the seminar in an expensive hotel.  Consider bowling clubs, surf clubs or RSLs.

  • Ensure all your staff members attend and wear name tags, so they are easily identifiable.

  • Allow time at the end of the seminar for networking and questions. We provide food and beverages for an hour after the event, so we have time to meet with attendees to discuss the seminar and their needs in more detail.

7. Would you organise seminars in the future?

Definitely! We are currently in the process of organising our next seminar.

If you would like any more information on the steps involved in planning a seminar, please feel free to contact me at kj@nmb.com.au.

Kate Jeremiah - Marketing Coordinator
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Preparing your client for a loan

Given the tighter lending criteria and mortgage insurer scrutiny each deal is subject to in the present market, there is an increasing need for a level of ‘preparation’ for your client, in order to have the best possible chance of being approved for a loan.

There are a number of factors to be considered that can assist in strengthening an application, which a client will need to be aware of when looking to buy, refinance or upgrade. 

Employment:
A borrower starting a new job, regardless of any improvement in financial position, can create a timing issue for an application.  They need to have completed probation and in the case of mortgage insurance, may have to wait up to 12 months before applying for a new loan.   

Self Employed Income:
Two years financials and ATO Assessment Notices are to be provided and can be no greater than 18 months old.  The cut off for provision of the previous year's financials is generally 1st April (earlier with some Lenders), so current applicants will need to have their 2008 and 2009 financials completed for submission.

Serviceable Debt Limits:
Check the clients’ liability position and if there are unnecessary credit card or loan limits that can be reduced in order to strengthen their servicing position, action it prior to application.   Store cards are something that can be overlooked by the applicant and has in some cases been classed as non-disclosure by a lender and resulted in decline.

Credit Enquiries:
Some lenders are taking into consideration the credit enquiries appearing on an applicants file for up to 2 years, which is impacting credit score.  If possible, obtain a copy of the applicant/s credit file and when submitting a deal, provide explanation for each enquiry to be submitted with the initial application.  This may also help remind the applicant of any unnecessary credit they may have such as store cards, which can be cancelled prior to application. 

Jodie Hainey - Lending Services Manager

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Electronic lodgement

One of many changes our industry has made in recent times is the move to the electronic lodgement of loan applications. Many lenders now have the ability to accept loan applications electronically via their own proprietary systems or third party providers.  As an aggregator, nMB is regularly measured on number and quality of electronic lodgements made to these lenders.  I am pleased to advise due to the good work and quality of our broker network, nMB enjoys a very high ratio of both lodgements and quality of business submitted using this medium. 

Much of the success is due to the longstanding partnership nMB has with Pisces. The company’s electronic lodgement application (eApp), has been a component of our Mortgage Broker Suite (MBS) software for over 5 years.  One of the key benefits of using MBS/eApp as your loan lodgement platform is the system's ability to pre-populate data into your electronic application which will not only save you time, but will reduce the chance of input errors arising out of repeatedly keying in the same data.  Another feature is the ability to save and recall applications at a later stage, which means there is no requirement to complete the application form and lodge in one session.  As an example, an application can be taken at a client's home, saved and then later have the information verified and finishing touches made at the broker’s office prior to lodgement.  In addition, further loan applications can be lodged by recalling the existing file and making the necessary amendments.

If you are currently not registered to use Pisces, I encourage you to talk to your nMB BDM about the benefits of using eApp through your MBS.

Kon Avramidis - Director, Operations
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Gerard Tiffen - nMB Broker, Tiffen & Co.

1. Why did you join nMB? 

They are the best! They are great team to work with and have everything that I am looking for in an aggregator.

2. What do you like about being part of nMB?

Great staff and expert advice in all areas of running a mortgage broking business.

3. What do you like about being a broker?

I like the interaction with people and helping them achieve their home ownership goals.

4. My all time favourite food is:

 Weet Bix.

5. The last book I read was:  

We’re going on a Bear Hunt by Michael Rosen. It’s a great children’s book that my kids love.

6. Lately I’ve been listening to a lot of:

 John Mayer , Citizen Cope , and some top 40 stuff.

7. My favourite saying is:

Lately it's ‘SHHHHH, dad’s watching the footy’ .

8. My Ideal Sunday involves:

Sleeping all day probably. Just a stage in my life though (I have a 2 yr old and a 3 yr old who never sleep).

9. My biggest inspiration is:

My family - When you feel like you are really part of something that matters like a family, it encourages you to push yourself harder to make your contribution to them really count. I think you become a better and more creative person in the process.


10. If I didn’t live in Australia I would live in:

California - I have visited there a few times (we have family over there) and really loved Santa Cruz and i'm sure they could use another Mortgage Broker ;)

11. The most extravagant gift I have bought myself was:

A watch.

12. If I could have dinner with anyone (dead or alive) I would choose:

My Wife.

13. Three things I would love to do in my lifetime are:

  • See the Pyramids;

  • Do a Triathlon;

  • See my 2 little munchkins grow up into good, respectful people.

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nMB Professional Development Events

nMB's first round of PD events are fast approaching. If you haven't already registered but would like to attend, please email your state BDM asap.

Brisbane - Thursday April 29

Shepparton- Thursday April 29

Sydney - Tuesday May 4

Melbourne - Thursday May 6

Gippsland - Friday May 7

Canberra - Tuesday May 11

Perth - Thursday May 13