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Bring in the Experts: Let’s talk Lending: Panel discussion with the experts - Shared screen with speaker view
Stephen Clarke
18:48
It's sunny in Cambridge
Anup Rup
19:10
yes
Andre-Paul Stokes
19:13
loud an clear in dry inside
Kathleen Wright-St Clair
19:13
yes
Katrina Studholme
19:15
all good
Leigh Hodgetts
19:20
Morning!!!
Lynda Spicer
19:24
Good morning
Financial Advice New Zealand
19:29
Good morning everyone. Welcome to our 82nd Bring in the Expert Webinar. You have all been muted and your videos turned off but feel free to ask questions down the side bar in the chatroom and in questions and answers. Katrina Shanks will ask the questions on your behalf. Enjoy the webinar!
Andy Phillipson
20:08
It is a pain in the backside - it has taken all common sense out of lending
Stephen Clarke
20:25
Yes, becoming aware
Brenda Nom
20:25
Mostly but want more definition
Neil Inns
20:28
think so...
Leigh Hodgetts
20:30
Yes been swatting up on it all…
Paul Cootes
20:31
Yes
John White
20:34
Yes, all coming to play Oct 1st
Katrina Studholme
20:34
Yes
Emily TSAI
20:36
YES
Niel Thomson
20:39
Some of it!
Marchy Pang
20:41
yes would like to know the best practice
Paul Fuller
20:42
yes...
Anita Cheung
20:43
Yes. good morning everyone.
Maria Maltseva
20:43
Yes :)
Richard Piechazek
20:44
Yes, Creates a lot of work for advisors. What extra do we get
Bruce Cameron
20:45
Yes
Robert Herbert
20:45
Yup
Jack Lynskey
20:45
Aware of the obligations but not clear on what means for advisers
Marcus Augustine
20:48
Yes
Bruce Patten
20:52
Would be nice to see the banks take the same approach
Shula Newland
20:52
Yes from a Financial Mentor prespective
Kathleen Wright-St Clair
20:54
Yes I think so, looking forward to this info today
Stephen Clarke
20:56
Keen to hear more from lenders though
Charlie Lim
20:58
yes.
Della Woods
20:59
Some of it
Apa Fatialofa
21:00
yes
John Bolsover
21:14
Getting there
Jeffrey Royle
21:36
these are trying to fix something that is not broken, there has never been high risk lending and these on top of RBNZ will keep regualr Kiwis out of buying their furst home.
Shula Newland
22:02
There is harm being done from irresponsible lending, we see it at the coal face
Shula Newland
22:50
But this is mostly from non bank lenders
Stephen Clarke
22:56
Is Baden talking providser risk or structure risk?
Brenda Nom
22:59
What is behind this and does non banks and do other places like loan sharks have to do this as well? I want to know why this is needed.
Andy Phillipson
23:53
It appears that it has turned advisers in to processors, fill in the tick boxes, and the bank overrides all common sense and counteracts our advice. Where does the buck stop?
Andy Phillipson
25:09
that umi calculator is just replacing the actual affordability budgets advisers have actually been doing for years.
Shula Newland
26:15
In the past a lot of assumptions have been made about peoples living costs, you won't be able to do that any more
Brenda Nom
26:43
But if their costs are low will the banks use their benchmark as that is not fair
Neil Inns
26:46
Personally, I think advisers should just need to sign a declaration with each transaction confirming to the Bank that we comply with CCCFA reg's. I do not want to share my I.P. with a Bank around my detailed discussions as that's a competitive advantage. Can each bank please share with us all of your trade secrets?
Andy Phillipson
26:51
Just more unnecessary paperwork to cover the backsides of the banks. The same law applies to ALL banks. Why can't they STANDARDISE the forms and questionaires?
Shula Newland
27:29
Don't have to benchmark by default, that is banks choice
Craig Pope
28:09
Given the amount of extra work Advisers are having to do on behalf of Banks, will they review clawback charges? Giving away less cash back will help fund this.
Brenda Nom
28:26
I am guessing your branch staff will need to be doing the same correct?
Stephen Clarke
29:18
If the rules are the same for everyone then why wouldn't they be interpreted the same?
Andy Phillipson
29:20
Until we get all the information, we cannot recommend a bank. But every bank needs different information and forms completed, so we either complete ALL forms for all banks, OR decide on a bank at the initial interview, taking away our independent advice process and responsibilities.
Andy Phillipson
30:46
Who is responsible for loan document disclosure?
Richard Piechazek
32:19
Can each lender put their "interpretation" on the CCCFA requirements on their policy guides or a separate document that can be retrieved from platforms such as mycrm
Shula Newland
32:31
How is the bank going to capture regular costs that now have to be captured regardless of whether they essential?
Shula Newland
33:00
How many of the banks are using automatic bank statement analysis
Brenda Nom
33:14
So what will you all classify as "discretionary income" as I need another loan for some land and I spend a lot on many things due to working long hours etc so I would like to know what is consider discretionary income as otherwise no one will be getting a loan. Also how do you think this will effect advisers and banks in conjunction with banks reducing loans to 10% of their books on over 80% lending.
Brenda Nom
33:53
Who uses ILLION?
Trish Greenwood
34:14
I use Illion - it's great and well worth it.
Shane Murray
34:16
Yes Illion is good
Kaushik Gorasia
34:25
we use it as well
Shula Newland
34:30
I have been testing Illion on my clients, I can still see gaps in it though
Jacob Annals
34:33
Realistically, could we see ANZ, ASB, BNZ & Westpac agreeing on what information is required so that advisers could gather information relevant to all mentioned banks?For example, some banks consider home insurance essential, and not contents, while others consider these as one in the same.
Shula Newland
35:10
Buy now and pay now, need to see if it is regular or not
Baden Gray
35:18
some after pay is asset purchases not reg expense
Brenda Nom
35:31
Yeah Illion is good but has some gaps. Yes be good if they could all get on same page.
Apa Fatialofa
36:01
What are the lenders view if a couple do want to start a family in a couple of years time. How does that affect their affordability if say they are obtaining finance today?
Steve Wymer
36:21
I agree Apa, how long is a piece of string?
Shula Newland
36:52
If it is in next 12 months, must be taken into account.
Andy Phillipson
37:03
Apa - I actually ASK my clients about family plans. But that is against the law.
Baden Gray
37:12
will proof of contraception suffice?
Martin Robinson
37:20
Will the updated calculators result in reduced approvals?
Kaushik Gorasia
37:57
Already seeing that
Andy Phillipson
37:58
That banks are not the real problem - the real problem in the finance industry are the finance companies and after pay providers
Steve Wymer
38:01
Even if you complete the bank calculators, they always seem to come up with a different number anyway
robyn edwards
38:12
will the lenders decline a loan due to wanting to start a family in say 12-18 months time - this might not even happen! Discrimination ….
Brenda Nom
38:17
Agree Steve
Della Woods
38:28
First home buyers are generally younger members who will generally have children in the future, if they have a savings plan for maternity leave will this need to be considered in the expenses??
Leigh Hodgetts
38:36
Great idea. Adam..
susan aitken
38:46
agree Steve
Andy Phillipson
38:47
What if us advisers can come up with a standard form that meets all requirements and give this to the banks?
Elise Vine
39:02
how are they looking at clients that are in defacto relationships that run their finances separately - not requiring the partners finance info for work that one partner is wanting to do
Andy Phillipson
39:09
Not just the aggregators
Bruce Patten
39:09
👌
Steve Wymer
39:36
We are having to provide more and more information for lenders, a lot of it should be completed themselves.
Andy Phillipson
39:47
There is ONE law, WHY are there 5 different interpretations of the CCCFA?
robyn edwards
40:07
the banks calculators is just a guideline for us - its ridicules. going blind with so much
Andy Phillipson
40:18
I'm happy to develop a standard form.
Paul Michaelsen
40:21
I think Adams comments are fair but banks have never got on the same page in the past and it has been tried several times.
danny blackman
40:38
because no one can understand the one law Andy
Paul Cootes
40:49
Katrina, a Standard from would be similar to the Sales & Purchase Agreements v10 on house purchases.
Shula Newland
41:07
True affordability should be consistent through each application
Della Woods
41:08
Adding to Elise question what about siblings and friends that have or ant to buy a home together, what are the banks thoughts on their future needs that will be outside the other parties?
Andy Phillipson
41:15
Previously the NZMBA had a standard loan application form. Why can't this be done again?
Baden Gray
41:18
it must be a nightmare for the assessors looking at all our different application forms. A standard industry wide one like the old NZMBA but digital one would be awesome but it'll never happen.
Brenda Nom
41:18
Half our appt is disclosures
Jonathan Watts
42:00
Actually we don't want all the banks on the same page. We need and want those differences at times because that provides us with alternatives when we need them.
Baden Gray
42:37
I agree Brenda its a shocka
Steve Wymer
43:04
OK...… so fixed term rollovers. Half of the banks don't even pay a commission for us providers having a quality conversation with our clients and advising on their best options. With the amount of time involved, $150 doesn't even cover your time.
William Slater
43:21
I agree Jonathan. There needs to be points of difference.
Brenda Nom
43:36
100% agree $150 is nothing for our time and effort for retaining one of their clients
Kaushik Gorasia
43:52
Also big difference in the expectation from Advisers as opposed to their own employees or direct channels
Jackie Scott
44:26
The issue with just using rates on their app is that
Andy Phillipson
44:38
With the new requirements, it is only making sense to use a bank that gives trail commission. Otherwise any advice simply becomes transactional and further advice requires charging a fee. This is disadvantageous to the clients.
Jacob Annals
44:46
Which disclosure documents are required for fixed rate rollovers?
Eleanor Rodrigues
44:47
What about time and work going into interest only extension applications.
Karen Renwick
45:18
what if they lock in rate themselves, but this may not have been the most appropriate for their current position/known plans??
Darren Caldwell
45:22
The banks should remove the ability for customers to re-fix via internet banking/phone app without having sought advice first? Given how serious they are with the responsibility advisors must take with the re-fix process it seems unconscionable that they would continue with this no advice practise.
Steve Wymer
45:41
And most lenders don't even pay that. Quality brokers wear this cost because the other alternative is asking our clients to contact the bank themselves, and they get put through to an 0800 number and get people who have never owned a home before :-(
Baden Gray
45:56
Correct Darren
Niel Thomson
46:25
What's required when a new client to the adviser comes to ask for a fixed rate rollover?
Jackie Scott
46:33
The issue with just using the rates on the app is that we aren't privy to that information and we are relying on having the client tell us, so can undermine the benefit of using an adviser. The other issue is when the client can go direct to the bank and get paid cashback again to re-fix, when we as advisers can't offer the same - not a level playing field.
Andy Phillipson
46:38
Well said Steve
Steve Wymer
46:50
I agree Darren, this is the banks passing the buck and having all care and no responsibility.
Craig Pope
46:51
The $150 fee for helping a refix hasn't changed in over 15 years!
Maria Nobilo
46:54
Do banks need to review the auto refix with seeking financial advice first?
Shane Murray
47:29
Agree Darren
Andy Phillipson
47:31
Several of my clients are bank staff themselves. They give advice to clients. But from what I have seen, they know absolutely nothing about reality.
susan aitken
47:43
with my own mortgage the bank just puts the rates up on line and I can pick one and there is no conversation with me by the Bank !!!!
Steve Wymer
47:54
Absolutely Maria, it is antiquated
Tony Caldwell
48:03
There seems to be so much double handling and recording under new regime, is an email trail stored to client file sufficient record without a duplicating diary note, which often just records what has been agreed in email.
Lisa Meredith
48:37
yes - definitely not a level playing field at all.. I went direct recently for my own mortgage and was amazed at what little advice and minimal documentation was required - there is a massive gap from what we do and what happens bank direct - so very wrong
Udita Sood
48:54
Do we need to mention anything our current disclosures about CCCFA, despite of getting additional declaration from different banks.
Andy Phillipson
49:58
Our costs are now exceeding $1000 a month just to stay in the industry. This has to stop.
Steve Wymer
51:06
I agree Andy, it is getting ridiculous.
Darrin McCormack
52:06
The fixed rate process is a shambles across the board. High in admin and advice with very little in return for advice that banks don't want to provide . So it lands on the advisers lap which essentially is free advice (non-trail) but a lot of liability.
Tim O'Connor
52:12
How about offering customers reasonable fixed rates for the entire term like the US?
Sam Parsons
52:13
I agree with Darren. It is interesting that an adviser needs to go through a full disclosure process and declaration + diary notes for every re-fix conversation. This makes more work for the client and adviser. The online re-fix process has become so easy/thoughtless but in my experience does not result in best customer outcomes.
Brenda Nom
52:26
Agree more costs for us more time on disclosures I am feeling really frustrated as no one can go First home loans anymore as caps too low and now banks reducing over 80% to 10% of their book, we will feel it big time.
Brenda Nom
52:54
Agree Darrin.
Shula Newland
53:17
I am currently researching new CCCFA and how lenders are responding to it and looking to develop a standard method for assessing affordability. If anyone is interested in this email me on shula@fullbalance.co.nz
Andy Phillipson
54:12
WIth banks closing branches faster than growth, they are relying on advisers to cover the shortfall in client service obligations. Why can't the banks acknowledge this and work WITH GOOD advisers, and make life easier?
susan aitken
54:36
Well said Andy
Paul Michaelsen
55:25
Fixed price contracts are never fixed price contracts due to the PC Sums. If banks want true fixed price contracts they need to work with Certified Builders or Master Builders Association. However risk with fixed price contract is that if you remove PC sums clients could end up paying more for a build as not all PC Sums are fully utilised.
David Windler
55:26
as advocates of third party id like the panel to give us some comfort that these compliance/regulatory requirements are being applied equally to direct channels within their bank. additionally, can I ask why third party turnaround times can be up to 10 times longer than direct channels?
Steve Wymer
55:32
Unfortunately, we will never get that Andy
Andy Phillipson
56:37
Shula - I have tried this, but the banks are not interested at all. They want their own paper. I suspect it is because they want to tie advisers to them to streamline the application process. I know MANY advisers who only use one bank.
Tony Caldwell
56:52
Whats happening with factory built houses, surely this is the future , enquiries for these houses growing, but cant do anything.
Steve Wymer
58:14
I mitigate ALL of my applications BUT I find the banks very rarely even look at a full diary note.
Adrienne Zwarts
58:18
In years gone by banks would not include the women's income in debt servicing are we going back to this again.
Andy Phillipson
58:27
Same here Steve
Paul Cootes
58:53
I agree too Andy & Steve
Steve Wymer
59:49
When you ask them to read the diary note to answer all of their questions, all it dies is get their back up and I feel the bank then loses interest in tour application.
Andy Phillipson
59:50
It is all about box-ticking. It appears that all common sense has been taken away from the advice and application process. The lending managers simply fill in the numbers and wait for the algorithm to spit out an answer.
Andy Phillipson
01:01:54
Why don't banks use the ACTUAL budget that we supply, and look at age versus stage, and what assets have been accumulated compared to income? The UMI calculators are a farce - they have no bearing on reality.
Della Woods
01:02:53
DTI - will this also be countered with actual rent being paid by clients vs their proposed mortgage lending payments?
Steve Wymer
01:03:47
Exactly, especially when they are already mitigating EVERY application, with servicing and sensibility rates being utilised between 6-7%
danny blackman
01:03:48
Is there any plans to reduce your test rates to make DSR more affordable in the current market
Jacob Annals
01:04:36
I have had clients approach me to try and increase their directly sourced loan offer, only to find that it’s significantly short of servicing what they can afford already.Are the benchmark expenses used for adviser calculators not required for non-adviser applications?
susan aitken
01:06:11
With prices being high in Auckland more young people are looking to buy with siblings etc to be able to pool deposits and income instead of just flatting together, and the solicitors draw up agreements in behind to protect them all, but I find some Banks do not look at the total income coming in to service the application, they expect both parties to be able to cover the whole lot
Stephen Clarke
01:06:12
Is the problem with the pre-fab house due to the fact that the lender can't rely on the improved value until the house is on the site?
Andy Phillipson
01:06:26
Why are banks only accepting 60% of rental income now? We already take into account additional future costs associated with rental properties, and don't take into account any tax advantages. And none of the rental properties my clients have ever had less than 90% occupancy. It appears the banks are double-dipping now.
Paul Fuller
01:06:30
Why do banks charge an recovering cost in a falling fixed rate market, but when rates are increasing (currently), why do banks retain the benefit when a fixed loan is broken by client and not disclosed to clients. It seems banks recover with one hand and retain with the other with client taking on risk. Is this working in clients best interest as its an recovering cost not a fee - does this meet CCCFA?
Andy Phillipson
01:07:19
I don't believe that Adam - I have had applications turned down, but the clients got an approval when they approached the bank directly.
Brenda Nom
01:07:38
I have too Andy
Darrin McCormack
01:08:24
Particularly via mobiles!
Andy Phillipson
01:08:36
One bank has even poached my clients following a decline (on 2 occasions)
susan aitken
01:08:46
I have had that to , but to the Banks credit they have apologised and paid me, but the problem was the damage caused because the client thinks you are an idiot
Jonathan Watts
01:08:46
Good explanation adam
Krish Krishna
01:09:01
Adam I disagree, it happens quite often
Jonathan Watts
01:09:57
Branches actually assess more harshly I have found
Steve Wymer
01:10:05
As an ex MMM for two mainstream banks, I know that there is far more flexibility provided
Lisa Meredith
01:10:08
Agree Susan - have had it several times and been paid by the banks.. but it’s credibility that is the main issue for us
Asher Ingram
01:10:14
I agree with braches assessing more aggresively
Jackie Scott
01:11:12
How are you meeting the advice process in bank when clients are directly re-fixing online without advice?
Neil Inns
01:11:26
Baden M - internal UMI calc is different and openly stated as that from your team. You adopt an additional scoring element that means the UMI form we advisers are given is a best guess...
Darrin McCormack
01:11:26
Is anyone left at the branches?
Jonathan Watts
01:11:59
Are any of the banks considering any changes to adviser commission structures IE: down?
Tony Caldwell
01:12:00
What are the three key things that a good broker does v's not so good broker.....
Stu Pope
01:12:07
I have been told by ANZ that their internal servicing calculator differs from what advisers have, is that correct??
David Windler
01:12:55
good session - thanks heaps
Karen Millar
01:13:00
I have also had on several occasions been told that ANZ's interna servicing calculator is different to what we are provided and expected to use
susan aitken
01:13:05
It is great to have you four on line as we get to let you know what is happening out there directly Thank you
Andy Phillipson
01:13:48
What are the chances of one standard debt servicing calculator used by all banks, that meets the CCCFA requirements?
cherylyn clitherow
01:14:17
the calculator used by the banks differ from the one we have, does not make a fair playing field
robyn edwards
01:14:25
informative - thank you all for coming on the web
Ben Jamieson
01:14:47
Thank you Ben RESIMAC
cherylyn clitherow
01:14:52
the internal servicing calc differ from the ones we use
Alan Pumfleet
01:15:11
Thank you very interesting. Good luck all!
Andy Phillipson
01:15:22
Can we establish a forum where all bank BDMS and a group of mortgage advisers can work together to streamline the process for everyone - clients, advisers, and banks?
Leigh Hodgetts
01:15:39
Great session all…. Thanks.. Hi to Remy too
Trish Greenwood
01:15:48
Thanks for your time and the information :)
Lynda Spicer
01:15:48
Thank you everyone for the commentary
Lisa Meredith
01:16:03
thanks - this has been the most useful webinar in a long time.
Ramesh Parmar
01:16:10
In my view point -all of you on the panel are doing a wonderful job in enabling people to move in to their dream home with changing regulatory environment.
Paul Cootes
01:16:17
Great webinar. Paul SHARE
Tony Caldwell
01:16:20
Good session , Thanks
Karen Renwick
01:16:27
Thank you. Been really great to hear from you all.
Jeffrey Royle
01:16:29
Good discussion around unpleasant and unwarranted changes in CCCFA. I expect to see some non bank lenders drop personal lending completely.
Jackie Scott
01:16:34
Thank you to each of the panellists - informative and helpful.
Steve Wymer
01:16:34
Thanks, an hour well spent :-)
Katrina Studholme
01:16:37
Thank you
Maria Maltseva
01:16:37
Thanks heaps!Super handy ☺️
Moosa Mohammed
01:16:38
Great to have all 3 banks on one platform, and get their perspective, thanks
danny blackman
01:16:42
Thank you all
Simon Russell
01:16:44
Thanks
Moosa Mohammed
01:16:46
*4 Banks
Eleanor Rodrigues
01:16:48
Extremely valuable, thanks!
Lisa O'Neill
01:16:48
Thank you
Chace Olsen
01:16:51
Thank you all!
Apa Fatialofa
01:16:51
Thanks
susan aitken
01:16:52
thanks everyone
Mary Obrien
01:16:53
Amazing from everyone. Thank you so so much
Della Woods
01:16:53
Thanks panelists great discussion
Monalisa Urquhart
01:16:57
Thanks to all
Krish Krishna
01:17:05
thank guys
Nicholas Schnell
01:17:05
Thanks guys
Kaushik Gorasia
01:17:09
Great session. Thanks to all panelists and you, Katrina
Karen Millar
01:17:10
Thank you. Bring on the same forms across all lenders :-)
Brenda Nom
01:17:10
Thank you all take care
Angela Downie
01:17:11
Thanks team!
Vicky Smith
01:17:11
Thank you
John Bolsover
01:17:11
`Thank-you Adam, Liz, Baden and Amanda that was a very useful discussion.
Dave Jochem
01:17:12
😃
Quency Wong
01:17:12
Thanks heaps and is a most useful one with a lot of valid points.
Maria Nobilo
01:17:12
Very useful - thanks to all for your time
Robert Herbert
01:17:14
Thanks
Holly Rogers
01:17:16
Thank you very informative
Charlie Lim
01:17:16
thanks everyone