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Which brings me to my next point: we have seen an increasing popularity in temporary lender campaigns to try and grab some market share and boost their brand.
Once the campaign gets some cut-through and the applications are flying in the door, no matter how well they say they prepared, the back office crumbles, their service times blow out to over a week, and then it’s a chase your tail-type arrangement for the two months after the campaign closes while they clear out the pipeline.
When client expectations cannot be managed, it’s not good business practice for anyone involved and the client suffers by trying to chase the lowest price. Talk about rate isn’t everything. For a lot of our clients, especially investors or clients who have been through the process a few times before, they would much rather a smooth consistent service and pay the extra 20 basis points. It’s a small price to pay when everything goes to plan and you know what you’re dealing with.
I would much rather see second-tier lenders invest their time and money into developing long-term policy changes and increasing their appetite to compete with each other and the larger banks. Providing more solutions and making it easy to obtain results for my clients is the most important thing to me. Selling a loan to rate shoppers who will want to refinance at the next campaign is not economically viable or sustainable. Hopefully, we start to see some improved policies this year and make that where the competition is.