Powered by MOMENTUM MEDIA
subscribe to our newsletter

Financial advice JVs on the rise, says aggregator

A non-bank aggregator has identified that new business structures are being formed between mortgage brokerages and financial planning firms in place of traditional referral deals.

Kevin Frost, general manager of Centrepoint Lending Solutions (CLS), the aggregator owned by ASX-listed Centrepoint Alliance, said the method for cementing business partnerships between the two sectors is undergoing a shift.

While historically, financial advice and accounting practices would approach CLS to provide lending referrals to a mortgage broker outside their practice, they are now adopting new structures more akin to joint ventures, Mr Frost said.

“Many advice practices are now setting up new business structures and either employing brokers on salaries or both parties are taking a financial stake in a joint venture or partnership,” he said.

"This approach means that internal referral processes can be properly integrated, and office and administration costs can be shared. Most importantly, it means the mortgage broker becomes an integral part of the business.”

The change in business structure could also see an increase in the volume of loans written.

“It also means the mortgage broker can properly leverage their client base by referring them for financial advice,” Mr Frost said.

Advertisement
Advertisement

PROMOTED CONTENT


A Brisbane financial planning group recently approached CLS to source an existing mortgage broker that would join their firm on a salary plus profit-share basis, with the group willing to buy out the broker's current trail book, he said.

"This approach isn't for all mortgage brokers, advice or accounting practices," he added, however. "There are still many practices who are content to simply refer each other business, and this often makes sense in terms of their size and focus.”

Centrepoint Alliance also owns financial planning dealer groups Professional Investment Services and Alliance Wealth and the Associated Advisory Practice network of self-licensed advice firms. 

Financial advice JVs on the rise, says aggregator
mortgagebusiness

Latest News

The shareholders of the neobank have agreed to the scheme of arrangement that would see NAB acquire all the issued share capital in the comp...

ASIC has begun proceedings against the major bank for insider trading and breaches of its licensee obligations during the privatisation of A...

The value of total dwellings approved hit a record high in March, driven by a spike in non-residential building, according to new data. ...

FROM THE WEB

Do you expect to see strong uptake of the HomeBuilder scheme?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.