You may be asking "do we need bond originators?" Why not approach your bank manager or relationship manager directly? After all, they should know you and your business well enough to immediately approve a simple home loan for you.
Unless you've been into your bank recently, you would not have noticed that your "relationship manager" has moved to a different division or branch, as most banks change their managers as often as every six months. Furthermore, as with bond originators, your bank manager does not approve your home loan application. He merely motivates it, submitting all the required supporting documents and financial information to a division responsible purely for granting home loans.
If you are a property investor or have bought and sold property in the last five years by using a competent bond originator to finance all your transactions, you will find that your bond originator still has all your information on record. Furthermore, if you are a regular property trader, they will know exactly which property has been financed by which bank, whether the properties are tenanted or not, your existing exposure to the banks and which entity (company, close corporation or trust) you normally use to purchase property.
A pre-requisite of being a proficient bond originator is that they need to be knowledgeable of all various mortgage products offered by the four commercial banks, enabling them to identify which bank is more likely to accept your credit profile and which bank, at the time of your application, will offer you the best interest rate. If you opt not to use a bond originator, you will have to approach all four banks individually in order to obtain this comparison.
We have all at one point or another been frustrated by the growing tendency of big corporate organisations employing the service of call centers. Should your query be a tad more complicated than "press 1 for the latest interest rate", you may have to log a query, upon which you will receive a reference number and have to wait for a couple hours or even days for someone to return your call.
Bond originators provide a personalised service. Being well-versed in most aspects of the property and financial industry, they will accurately and efficiently answer your questions and possibly even come up with some beneficial suggestions on how to best structure your next property acquisition.
While banks have the final say on whether to approve or decline an application, originators understand how the credit managers will perceive an application, enabling them to position an application for the best possible outcome. Should irregularities arise in the process of gathering the required documents and information, they are able to advise the client on what steps to take to remedy the situation before presenting the application to the bank. For example, if the client is overexposed to credit, they may advise that he cancels a credit card or two, reducing his credit obligation, prior to submitting his application.
Most bond originators will not hesitate to meet with accountants and auditors, not only to collect the required financial statements and signatures thereon, but also, if need be, obtain a better understanding of the clients current financial position.
Fighting for the best interest rate in the market is only one mission in the average day of a bond originator. Customer education and support, answering queries, motivating applications, liaising with accountants and mediating with bank officials and attorneys are other vital functions they perform on a daily basis, for which they seldom get recognised.
The answer to the original question "Do we need bond originators in this market?" is an emphatic "yes". Bond originators continue to provide a dual service to both the banks and the individual property buyers, saving all parties time, money and unnecessary frustration.
While this remains a relatively young industry, in comparison to other financial sectors, there is no doubt that its benefits to the property industry far outweigh its limitations. If nothing else, it has introduced a healthy competitive edge to the benefit of the consumer.
For more information contact Tess Rodrigues on 0861 106 306 or send an email.
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