Tic:Toc to undercut broker distribution in white label play

December 16, 2017

online lener

Mortgage brokers are facing a double threat from online lender Tic:Toc, which is seeing a surge in demand from consumers and interest from banks and non-bank lenders looking for cheaper distribution.

Tic:Toc promotes its quick turnaround times and convenience. The group only offers its own branded mortgages, which it says can be approved within 22 minutes through a completely online process. The fintech started lending four months ago and has received approximately $330 million of applications in that time, with conversions hovering around 17 per cent this month.

“The new competitive battleground in mortgages is speed, and that is best delivered through an end-to-end digital fulfillment process like ours,” Tic:Toc founder and chief executive Anthony Baum told The Adviser.

“I don’t just mean time to decision. Convenience is also an important factor. What we know about consumers is that a growing segment are happy to self-service and are getting more used to self-serving through fulfilling other requirements digitally in terms of purchasing products and services.

“At the end of the day, the feedback we are getting is that it is really easy, customers don’t feel pressured and they don’t feel sold.”

The online lender is currently funded by Bendigo and Adelaide Bank and offers four mortgage products. An interest-only mortgage for property investors is due to launch in the coming weeks.

Mr Baum said that the company has plans to partner with more bank and non-bank lenders looking for a cheaper distribution channel than mortgage brokers.

He explained that the digital origination process cuts costs for both consumers and funders.

“It really does open up the distribution angles and fulfillment angles. We think that is a very powerful change,” Mr Baum said. “It could be any corporate whose brand stretches to financial services products, including non-banks. We are working on some of those arrangements as we speak and hope to make some announcements in the new year.”

Unlike some fintech players looking to disrupt the home loan market, Mr Baum has extensive industry experience, having led Bendigo and Adelaide Bank’s third-party business for close to four years.

In addition to its broker ties, Adelaide Bank is a prominent wholesale funder for mortgage managers and aggregators and is widely regarded as one of the more innovative lenders in the market.

The threat of digital disruption has increased for brokers in recent years. However, many still believe that face-to-face contact with a mortgage professional will continue to be the preferred choice for Australian borrowers.

“My opinion is home loans are not actually as complicated as the industry makes out,” Mr Baum said. “They are really a means to an end, which is more a utility-style product.

“Having said that, there are certain customers who have complex situations who will always need to seek advice.”


Tags: , , , , , , , ,

Better Choice Mortgage Services is not responsible for, and expressly disclaims all liability for, damages of any kind arising out of use, reference to, or reliance on any information contained within this website. While the information contained within this website is periodically updated, no guarantee is given that the information provided in this website is correct, complete, and up-to-date. Although the Better Choice Mortgage Services website may include links providing direct access to other internet resources, including websites, Better Choice Mortgage Services is not responsible for the accuracy or content of information contained in these websites. Links from Better Choice Mortgage Services to third-party sites do not constitute an endorsement by Better Choice Mortgage Services of the parties or their products and services. The appearance on the website of advertisements and product or service information does not constitute an endorsement by Better Choice Mortgage Services, and Better Choice Mortgage Services has not investigated the claims made by any advertiser. Product information is based solely on material received from suppliers. Advanced Finance (Pty) Ltd t/a Better Choice Mortgage Services are not financial planners or accountants and we would encourage our clients to seek professional advice before acting on any a financial or taxation information in this news post.

Contact Us

1300 805 221

Better Choice