The Age has reported "The major banks are failing home buyers who want to process their loan applications online, with customers facing poor service and convoluted forms, a new survey has found".
Not surprising. In my law practice I rarely see clients using the online application route. Its either the Branch or the Broker. Occasionaly we see either a Homepath or an ING Direct, both online applications.
Homepath offers a no frills low interest rate loan. But their service in loan approval, preparing loan documentation and settlement organisational skills I would rate very poor (actually they would be in the bottom quartile). You might get a no frills loan but it's a no thrills service. You wouldn't want to throw them a curve ball.
No wonder customers turn to the brokers or the branch. You at least get service. The mortgage broker we often turn to, service is the key to their success. Submitting an application is actually an art form. Most applications are at least 20 pages long. Then they actively follow through in getting the approval and personally attend the client for signing up the loan and security documents. Full marks.
Turn to the online model. As an example I logged onto Virgin Home Loans, the newest entrant. I failed to get beyond Step 1. There are just too many fields to complete. Step 1 is one of 6 steps. Really, keep it simple. Get the customer to fill in a one page summary, collect $200 or $300 upfront and send out a mobile lender to take care of the rest. Refund the $200 if they proceed to settlement. Guys its about service and delivery.
In my conveyancing business I collect a deposit upfront. Customers dont mind. Thereafter they are committed. We collect a deposit and we then prepare and deliver vendor statements online. If the property doesn't sell we don't need to invoice the client as the deposit has covered our costs. We collect the balance of our fee at settlement.
Ditto for mortgage applications. Collect a deposit upfront and give some real service and that certainly doesn't mean some tele-worker who doesn't understand the customers needs or requirements.
Anyhow, the online forms don't work for me. I'm one of those who don't mind paying a bit extra for service.
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