PROPERTY: Realnet Shakes Up Its Home Finance Strategy
Recent Kwazulu-Natal Business News
In a move that quite possibly indicates the more fluid shape of things to come in home financing generally, the RealNet property group has announced major changes in the way it deals with mortgage origination.
“With immediate effect,” says MD Jan Davel, “RealNet will have a panel of accredited mortgage originators. Our franchisees and agents will thus have a choice of companies through which they can channel their clients’ home loan applications.”
This follows RealNet’s decision, he says, not to renew its exclusive mortgage origination agreement with only one service provider that expired at the end of December, and takes into account the much-changed bank lending criteria and origination market conditions since the original agreement was concluded.
“We have also taken into account the fact that our franchisees often have good direct relationships with the banks in their areas, and the fact that different bond originators are better represented in some areas than in others. In short, what we are putting in place is a much more flexible system that gives our homebuyers in each area that we serve the best possible chance of having their home loan application approved.
“Quite apart from the stricter lending criteria imposed by the National Credit Act, we have found that the banks’ automated credit scoring systems often reject borrowers for reasons that can quite easily be resolved once there is human intervention, for example person-to-person contact between an originator and a banker, or perhaps just re-submission of the application to a different lender.”
Indeed, Davel notes, the latest statistics from mortgage originator ooba indicate that the percentage of home loan applications declined by one lender but approved by another increased 12,6% year-on-year in December 2010 to 29,2%.
“In other words, almost a third of the applications initially rejected were saved by further action to get them approved.”
He says the RealNet panel of accredited originators will include Betterbond, Bond Choice, BondExcel, Green Door Homeloans, MultiNet Mortgages and ooba.
“And at this stage, these originators can offer prospective borrowers ‘unlimited access’ to Standard Bank, First National Bank and Nedbank. We are meanwhile negotiating a direct agreement with ABSA Home Loans in terms of which ABSA Express Agents and/or accredited intermediaries will service RealNet clients in respect of ABSA applications.
Business News Sector Tags: Property|
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