2020 MFAA Excellence Awards: National Finalists

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Congratulations, and best of luck to all our National finalists for the 2020 MFAA Excellence Awards.

To be recognised as a finalist speaks volumes of your exceptional practice and professionalism in the mortgage and finance industry.

Finalists

Nick Smith (Red10 Finance) – Commercial Finance Broker Award

Rise High Financial Solutions – Customer Service Award – Business

Rise High Financial Solutions – Finance Broker Business Award

Michelle Towner (Towner Finance) – Customer Service – Individual

Michelle Towner (Towner Finance) – Residential Finance Broker Award

Gerhard Sifkovits (Elite Finance) – Newcomer Award

Elizabeth Arche (The Practice) – Loan Administrator Award

Rebecca McIlwain (Birdie Wealth) – Loan Administrator Award

Josh Bartlett (Mortgage Advice Bureau) – Residential Finance Broker Award

Foti Apostolidis (AFG) – Business Development Manager Award – Aggregator

AFG – Aggregator Award

Australian Finance Group completes $700 million RMBS issue

AFG Head office

Australian Finance Group Ltd (ASX: AFG) has successfully priced its largest transaction to date, completing a $700 million AFG 2020-1 Trust Residential Mortgage Backed Securities (RMBS) issue.

AFG Chief Executive Officer David Bailey welcomed the successful transaction at a time of dislocation in the market brought about by the COVID-19 pandemic.

“The strong support we received for the issue is evidence of the depth of the securitized business.

“As both an originator and a distributor of mortgages, our experience informs our lending practices. Disciplined lending criteria and active management of the portfolio has meant we are in a fortunate position to take our paper to market.

“Our portfolio, 100% broker introduced, has a track record of outstanding performance and we are very pleased to see both new and return investor participation.

“The support from both domestic and international investors has allowed the deal to upsize from $350 million to $700 million.

“On behalf of AFG, I would like to express my thanks to our investors for their support. Support that has enabled the company to issue $3.575 billion of paper into the market over the past seven years.

The $700 million AFG 2020-1 Trust RMBS transaction settles on Thursday 30th July. Details are as follows:

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RBA’s cash rate for July remains unchanged at 0.25%

Reserve bank of australia sign

The RBA has announced that the cash rate will remain unchanged for July with the rate remaining at 0.25%.

The RBA is mindful of rising concerns around unemployment post-JobKeeper, falls in housing and home loan approvals, decreasing property values and decreasing credit growth. The RBA maintains the stance that negative interest rates are not the best option for the economy at this point.

If the COVID-19 crisis is affecting your financial situation, please get in touch so an AFG broker can formulate a plan to manage your loan repayments during these unprecedented times.

With lenders continuing to offer very competitive rates, an AFG broker can help review your situation to ensure you have the right loan for your circumstances.

If you’d like to chat about the best way to manage your mortgage as the COVID-19 crisis continues to unfold, please don’t hesitate to get in touch with an AFG broker.

Brokers called upon as market moves

Street Scape

(ASX:AFG) The AFG Index released today shows the role of broker has never been better illustrated than over the past few months. The dislocation to the economy and the lives of hundreds of thousands of Australian mortgage holders brought about by the COVID-19 pandemic has meant AFG brokers have been a reliable and important avenue for customers seeking assistance to navigate these uncertain times.

AFG CEO David Bailey explained the results. “This quarter saw AFG record its largest quarterly lodgement result at almost $17 billion. This is a 30% increase on the same time last year.

Breaking down the numbers by state, a comparison to Q4 19 is as follows:

State 12 Month Increase
NSW +36%
QLD +34%
SA +21%
VIC +23%
WA +34%
NT +36%

“Banks closing branches and redirecting these resources towards dealing with hardship cases has meant that brokers have been spending considerable time working through the options for those clients who have taken the opportunity to examine their circumstances and make changes to their financial arrangements.

Given these unusual times, AFG has again elected to disclose additional month by month data.

Month Lodge # Lodge Vol Avg Loan Inv % First Home Buyers % Refinance % Upgrader % Interest Only % Principal & Interest %
Apr-20 9,405 $5,217,890,839 $554,800 26% 12% 38% 36% 17% 83%
May-20 11,269 $6,127,419,783 $543,741 26% 14% 36% 36% 16% 84%
Jun-20 10,406 $5,564,824,672 $534,771 22% 21% 23% 42% 14% 86%

“It has been very interesting to see where some of the mortgage activity has come from. Ending the previous quarter, refinancing activity was extremely strong. As some of the refinance incentives from the majors wound down, the market responded in a different manner with a flurry of activity for first home buyers aided by the various government incentives, and an increase in upgraders from those more confident in their financial position.

“Brokers assisting customers to find savings on their home mortgage repayments has seen refinancing activity on a rollercoaster. From 32% in the December quarter refinancing is now sitting at 23% however monthly data shows significant movement during the height of the pandemic, with refinancing activity rising to 38% in April as brokers helped borrowers shore up their positions.

“Supported by federal and state government stimulus packages, First Home Buyers have seized their opportunity to enter the market. First Home Buyer numbers surged to 21% in June, up from 12% in April. In fact, the federal government’s First Home Loan Deposit Scheme saw the largest amount of applications for guaranteed loans, 45%, were made through the broader mortgage broking channel.

Upgraders increased from 36% at the beginning of the quarter to 42% in June.

“Across the past few months, we have witnessed a significant shift in mix of business towards the country’s major lenders. The major banks have used their balance sheet strength to take back market share from the non-major lenders. Once again, it is worth examining the monthly activity for the full picture of movement in the market across the quarter.

Apr-20 May-20 Jun-20
ANZ 28.45% 36.87% 10.16%
CBA 15.21% 17.11% 23.66%
Bankwest 3.75% 4.12% 6.05%
NAB 11.10% 4.48% 7.71%
Westpac 6.93% 4.30% 6.27%
BOM 1.57% 1.05% 2.33%
Bank SA 0.39% 0.27% 0.41%
St George Bank 2.62% 1.93% 3.37%
Major Total 70.01% 70.13% 59.96%

“After peaking at around 70% in the quarter – which is the highest level since 2017 – the flows of business to the major lenders settled back down to 60% in the month of June.

“ANZ was the big winner among the majors, from 9.92% market share last quarter, rising as high as 36.87% in May driven by cash back offers and low fixed rate products. They increased their market share of fixed rate products to 33.66%.

“CBA benefitted from their consistency of service and back office efficiency to reap the reward with their share of the market rising from 14.7% last quarter to 23.66% by the end of June.

Market share of the Westpac group suffered due to a blow-out in turnaround times as they slipped from 20.14% at the close of Q3 to 12.38% at the end of June.

“Extremely competitive offers from the major lenders including cash incentives of up to $4,000 led to a drop in market share for the non-majors. However, processing bottlenecks began to impact turnaround times for the majors by the close of the quarter and the non-majors have begun to take back some ground.

“The role the broker continues to play during this COVID crisis by assisting their clients in making considered choices around their individual home loan circumstances should not be underestimated.

As the pandemic took hold the country’s lenders have responded rapidly to borrowers and have deferred or altered loan arrangements to help homeowners having difficulty meeting repayments.

“AFG Home Loans is no exception. Whilst not reported in the AFG Index, it is pleasing to note that the securitized lending business of AFG has seen the number of customers accessing assistance with the deferral of their repayments decrease from 4.98% in May to 4.34% at the close of the quarter. The number of customers choosing to cease the capitalization of unpaid interest onto their existing home loan by switching to Interest Only payments has slightly increased from 4.30% in May to 4.38%.

“At this time of dislocation in the market mortgage brokers continue to assist their clients by securing better interest rates, fostering competition, and, as evidenced by the lift in numbers, enabling first home buyers to access the market more efficiently with a higher level of certainty.”

Download full report here

AFG appoints industry advocate to NSW team

AFG Head office

AFG has strengthened its broker support team with the appointment Haley Bellamy in New South Wales. Haley joins the Partnership Manager team after working for the Institute of Strategic Management. Prior to that Haley was a highly successful mortgage broker and part of the leadership team at one of AFG’s leading groups, Smartmove.

Head of Sales & Distribution Chris Slater said he was delighted to add such an experienced business builder to the AFG team.

“Haley is extremely talented and brings a wealth of leadership, broker and support team development & lending experience to the team and is well known and highly respected by our lenders and industry partners.

“She worked her way to be one of our top performing brokers in NSW, won the AFG Women in Business Scholarship, is a previous MPA top 100 broker and has been a judge on the panel for the Australian Mortgage Awards.

Haley said she was thrilled to be working with AFG’s brokers. “It’s exciting being able to give back to the industry that has given me so much,” she said. “I look forward to supporting my brokers to deliver exceptional outcomes for their clients through AFG’s industry leading technology, tailored business coaching, training, marketing, events and support.

“The leadership team at AFG and my colleagues are world class and I am proud to be part of an organisation that is so focussed on delivering to its members through innovation and empowerment.

“To join the team in what has been such a challenging time for our members and their clients has only highlighted AFG’s agility and commitment to support its members, doing whatever it takes at every turn,” she concluded.

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