Speed dating for brokers and lenders

In the fast-paced world of mortgage broking, aggregators have developed a way for brokers to make the most of their time with lenders. We look at how speed dating is a perfect fit for brokers and lenders alike

One of the biggest complaints from both brokers and business development managers (BDMs) is that there are not enough hours in the day. Overworked brokers find that they have to split their time between developing new business, servicing existing clients and keeping up to date with new products from all of the different lenders.

If brokers fail to keep new business coming in, they suffer a feast and famine cycle that is unsustainable. If they fail to keep up with their current clients' needs, they lose their reputation of being a competent financial professional.

However, if brokers do not keep abreast of what the lenders are offering, they will inevitably fail to find the best product to fit their clients' financial needs. The major problem with juggling all of these priorities is where one finds the time to fit it all in.

Speed dating

Aggregators such as Australian Financial Group (AFG) and Choice Aggregation Services have found a way to ensure that their members are able to develop relationships with lenders' BDMs as well as keep up with all of the product innovations without devoting huge amounts of time to the cause.

Speed dating events are held around the country and bring together an aggregator's members and 12-18 lenders so that the BDMs can tell the brokers about what they have to offer and the brokers can learn about a large range of products in just one day.

Brokers are separated into groups of seven or eight and sit with each lender for 10-20 minutes. During that time the BDMs have the opportunity to explain how their product differentiates them from their competition, and the brokers are able to ask questions about the policies and processes in getting a loan through to completion.

Brokers are given 'report cards' where they are able to track the different attributes of the loans such as interest rates and credit requirements, and can also take notes regarding which types of clients could potentially benefit from the products.

"A BDM training a new member might take half an hour depending on what they've got to offer, [but] they might go an hour and a half to run through the whole process," says Scott Anderson, state manager of Queensland for Choice Aggregation Services.

"But with our lender forum speed dating event, they only have 10 minutes to say this is what's niche about us. This is our niche product, or two products, and this is our credit policy."

Anderson garnered industry experience from the side of brokers, having worked with ANZ for 16 years and acting as a BDM with RAMS for a couple of years. He says it would usually take up to a month and a half for a BDM to see 80 members to discuss different products, processes and procedures.

Anderson adds that more often than not there was little benefit from all of those visits because the brokers he would visit would only use that particular lender when the need arose.

"In a matter of 10 minutes, the BDMs have discussed their products," he says. "From the member's point of view, they'll improve their knowledge of the product and of the credit policies, so they're happy."

Anderson says that the role of aggregator is to bring the two parties together in events that benefit everyone. He says that Choice Aggregation Services holds speed dating events about once every six months in Queensland, with the last event in Brisbane attracting 80 of the area's 130 brokers.

"It's going to help everyone across the board," he says. "It's all about relationship building."

Everyone's interested

Anderson says that even though the days are not compulsory, they are so popular that there is usually a full house. Brokers like the fact that they can come and speak to so many BDMs who can often be quite difficult to get in contact with.

"To be honest, some of the lender BDMs aren't proactive enough," he says. "I used to be a lender BDM and I can see some aren't proactive enough - they don't conduct a regular calling on our members and this is probably why they don't get as much business from them."

He says that the speed dating events are an opportunity for BDMs to talk to brokers of all levels, not just the ones who have a high amount of business going through their companies.

Anderson says that he knew the aggregator was onto a good format after the first event brought instant success.

"The first one we ran we actually had six deals put through right away because our members didn't know where to put those deals," he says.

Anderson says he has received "fantastic" feedback from brokers and lenders alike, with lenders telling him the sessions are the best events they attend. He says the events provide a unique opportunity to forge relationships, which can be the difference between getting a deal done and watching it die.

"This business is all about relationships, because if there's a tight deal and something happens and you've got that rapport with the relationship manager, there's a great opportunity that they'll fight for it as well," Anderson says.

The popularity of these events has unfolded across the state, as members spread the word about the benefits of hearing straight from the lenders how different products can be right for their clients.

Lenders' view

Provident Cashflow has participated in the speed dating events of several aggregators, including both AFG and Choice. Managing director Matthew Nolan says that the benefit comes from having a closer discussion with brokers about the benefits of Provident's products.

"Broker speed dating provides a more intimate discussion rather than a formal presentation, and allows a lender to focus on and give attention to a smaller group of brokers rather than to a room full of 30 [brokers] or more," he says.

Anderson adds that brokers have the opportunity to ask for elaboration on a particular point or ask questions to make sure they have a full understanding of what the company has to offer, whereas they might not be as comfortable asking the same questions in a room filled with brokers.

Nolan says there are many advantages of the speed dating events, for example the ability to give brokers a quick overview of the product. However, he adds that there needs to be enough time for the BDMs to talk about the product and for the brokers to interrupt the talk to seek further explanation.

"The only drawbacks from a lender's perspective that I've experienced has been not having enough time allocated for each session," he says. "One speed dating day I only allocated 10 minutes per table ... [which] didn't allow for all the relevant information to be passed across."

Overall, Nolan says he thinks that the practice of speed dating will be replicated by more and more aggregators in the future.

Brokers benefit

Brad Beck, principal of Choice Home Loans, says that he has been able to put through several loans that he would not have otherwise been able to, thanks to finding out about products at the speed dating events.

"In today's market most aggregators have in excess of 30 lenders of some description, and it's difficult for brokers to physically meet all of the BDMs," Beck says. "In the space of 7-10 minutes you basically hammer the lender to find out as much as you can in that time. It takes away a lot of the hours and hours of arranging appointments for one-on-one intensive sessions."

Beck says that he enjoys the sessions because they provide access to the more obscure niche products that lenders have. When a broker is just looking to do a bread and butter loan, they will go to the lenders they are most comfortable working with, but each bank has one or two products that sets them apart from the competition and that is where Beck sees the real benefit of the speed dating sessions.

"Banks don't necessarily have a full product set that complements the entire community; they might have one or two products and here's the opportunity to find out what those one or two products are," he says.

Rather than have a presenter address frequently asked questions about the product, this format allows brokers to ask questions that are relevant to their clients' situations, making it more likely that they are able to pair a product to a particular client's financial needs.

Beck says that with 30-plus lenders on an aggregation panel, brokers typically favour the top 10 because of the trouble involved in keeping up with the developments of everyone on the panel.

"Every now and then at these functions someone will say something and you'll find out there's a guarantor product available for first-time homebuyers," he says. "You can go back to your database and say, 'Hey we were talking about this, there's a product available.' "

Beck says he relies on the speed dating days because some BDMs "are virtually inaccessible".

"I know that sounds bizarre, I know they've got a product to sell, but unless you're settling $2m-3m on an individual basis, most BDMs are probably not interested," he says. "It gives us an opportunity to have them all in one room instead of waiting [for] days to get an answer."

Beck says that brokers who do not necessarily attend professional development days tend to go to the speed dating events because they have the same appreciation.

"It seems to be a good deal for both sides of the camp," he says.

Time slaves

Events such as these will continue to be successful as people are placed under increasing time pressure. The pace of business just keeps accelerating and anyone who is unable to keep up will be left behind.

Brokers want to be able to get all of the information they need in the shortest possible amount of time. They also need to be able to develop a rapport with the people they do business with and create mutually valuable relationships, and these relationships can be facilitated through the speed dating events.

With everyone wanting to get one-on-one time with BDMs but with too many for them all to see, it looks as if aggregators have managed to find a solution that makes everyone happy.