Mortgage brokers are being urged to sell themselves on more than just cheaper rates.
The call comes from Martin Grunstein who is a customer service expert and professional speaker, and he told The Adviser that the mortgaging broking industry could focus on offering stress management as well as cheap rates.
Mr Grunstein said yes, borrowers want a cheap loan, but what they want most is to be guided through the daunting and possibly stressful mortgage process.
A price can be put on a loan but it can’t be put on being relieved of the stress and anxiety that comes with a home loan.
According to Mr Grunstein the more brokers can alleviate that anxiety, the less critical the interest rate of the loan becomes.
“Once the broker has done the job well the first time, if they keep in touch with that borrower and they refinance, that client is much less price-sensitive the second time because they know they had a good experience dealing with that broker,” he said.
Mr Grunstein said the mortgage industry had conditioned borrowers to focus solely on interest rates.
“If you listen to any advertising – brokers or banks – all they talk about is interest rate,” he said.
“Most people wouldn’t know their home loan interest rate if you asked them. But it’s all the banks and brokers talk about, so of course the customer is going to be interest rate-focused.”
Mr Grunstein said building relationships with clients was a way for quality mortgage brokers to separate themselves from the pack.
“If the only issue of differentiation is the interest rate of the loan, then it becomes a commodity, and commodities are sold on price,” he said.
“As soon as someone comes up with a better home loan interest rate, you will lose that customer to the person who is offering a better home loan interest rate.”