Gidday Ferdinach,It seems toe me you have the tiger by the tail a little, so I hope this helps:1. Timing – An approval in principle takes no time at all and if you allow a week that should be plenty. However you have to make your loan selection before you make your application and you probably want to allow another week to skill up for this.1b.…[Read more]

Gidday Pokeutpia,Back when I owned bSmart, I know that the brokers were able to arrange cash backs without a full refinance. The policy will vary from lender to lender and also on the skill and experience of your broker or borrowers agent.Although dealing with a regular cash back mortgage broker is fine, they still carry the bias hazards of…[Read more]

Dan42,With respect, Alistair has declared that he charged a fee for his advice which means that it should be in the best interest of the client. Do you disagree with that idea?And what's this about a few bucks ? $32,000 in today's' money according to your calculations on page 2 of this thread:

Dan42 wrote:
What Alistair is saying is that the…[Read more]

Gidday Alistair,So what you are saying is your client paid you a fee for service as a financial planner to get advice on income and loan structure as he could have done with any other suitably qualified and licensed planner.If your client were a prudent investor as you seem to suggest, why wouldn't he have simply taken this advice (given he has…[Read more]

e-stan,There are several different models in the market. You can read various opinions here.

Ha! Thanks Dan – My bad. That explains Richards signature.However it doesn't answer my question regarding:

Qlds007 wrote:
I am aware of several major lenders who will not accept loans from these brokers.

The situation in 2005 was then as it is now. The rumour was not correct, as far as I can determine, even in 2005. The rebate brokers that I…[Read more]

Qlds007 wrote:
I am aware of several major lenders who will not accept loans from these brokers.

Richard,I think you've been misled and are perpetuating a false rumour.  For the sake of setting the record straight and keeping yourself clear of the TPA, will you please add:The source of your knowledgeWhich lenders are you referring to and;Who /…[Read more]

Dan42 wrote:
If you took the rebates as cash, the value would be much, much less.

Gidday Dan42Some brokers direct deposit to your loan on a monthly basis unless otherwise directed so it is as close to cash as you can get.It's probably fairer and perhaps more accurate to say if you redraw the cash from the loan account, the interest and finance…[Read more]

Gidday Whoper123,Yes that saving was the present value for the $80,000 saving on the sample loan.It was calculated by Dan42 after feedback that the saving should be subject to discounted cash flow analysis, although it's fair to say that using discounting methods is not standard mortgage industry practice when making comparisons. (I'm not saying…[Read more]

Gidday Eloi,Sorry, you lost me…

eloi wrote:
Your argument is tottally thoughtless. Without the commissions brokers get there would be no brokers thus there would be no better deal for borrowers.

My argument was that commissions should continue which is why I wrote that…

mortgagedetective wrote:
I don't agree that commissions should be done…[Read more]

AIF QLD wrote:
My first question to you all is how do you value great advice?.

Good question Trent and this is one of the points I raised somewhere way back in the beginning!

AIF QLD wrote:
Personally i feel broker commissions should be done away with altogether and a service fee should be charged instead. Just like an accountant, solicitor,…[Read more]

Gidday,For those who are mildly curious, I have now sourced the most reliable indicator (remembering it is all statistics) and that number is 6.2 years.The source is Fujitsu Consulting and the official statement is:"Fujitsu maintains a marker model for the Australian Mortgage Industry which tracks consumer behaviour across the sector. The…[Read more]

Just a quick note of clarification on the MFAA's estimate of 4-5 years, I now have an informal response from Phil which explains that the estimate:"… was based on info from lenders.  However bear in mind that lenders classify each refi internally, or pay out for a refi elsewhere, or often changes to loans as new loans so this brings the…[Read more]

Thanks also for the MFAA reference. This seems to fit better with Spiro’s experience at least.

I’ll double check with Phil and see where they get that stat from. Sorry I didn’t think of him in the first place! I can’t see the forest for the trees sometimes.

Gidday Dan,

Thanks for the pickup, fat fingers on that one. The percentage is 0.5% or one in two hundred or 50 in 10,000.

My instinct tells me that their churn rate is low because their approach is so radically different to the mainstream lenders and brokers.

Which brings me back to my original post and that is, does anyone have a reliable stat…[Read more]

Thanks Spiro,

Your insight is excellent. Do you have an age and source for the 3.5 year statistic?

It’s seeming more like an urban myth based on the broker stats I mentioned and your own portfolio.

Does anyone have any suggestions of other forums or sources where I might be able to get to the bottom of this?

Thanks Terry,Another broker has provided me their book data ($b) in operation for 8 years which shows less than 0.05% of their book refinancing within that time. Of those that refinanced, the average life of loan was still closer to the 5 year mark, which means their moving average is more like 7.98 years and growing.I would imagine that those…[Read more]

Thanks God of Money,What is it that drives such a short finance cycle, is it simply that you have a buy/sell cycle or is there something else happening that triggers refinance?

Thanks CRJ,Do you keep returning to 0 equity? What's behind your strategy to keep re-establishing new loans?Can you also tell me the source for your 7 year stat? I'm pretty shocked by that one too.Thanks again,

Gidday Terry,What a coincidence, I have actually used that exact analogy in my book!However with brokers it's more like you’re paying the Prosecution who is bribing the barrister who is meant to be defending you. Add to that the question of whether they are even qualified to offer that advice in the first place and well….It seems we agree that i…[Read more]