Tuesday, 2 November 2010

ABSA - wherefore art thou goest!!!!

So, it is quite interesting, first they offer only 85% home loans, then they decline left right and centre for new applications including half their own clients, now: Absa informs all the mortgage home loan origination companies, that, with effect from 1st December 2010, all originators will only be allowed to originate home loans to Absa that have a loan to value (“LTV”) of 40% or less.

That equates to about 2 clients out of 200,000.

we all know that most new home loans businesshas a loan to value amount (LTV) of between 75% and 100%, this announcement will have a huge impact on the options available to the homebuyers for the future and of course it will effect the originators and the estate agencies that they originate for.

I am sure that Standard Bank, Nedbank and FNB cannot wait as now they will certainly get the cream of the crop clients from now onwards.


So who dies in the melee, you would ask.  Well for one, we heard clearly that Bond Choice will cease to operate as an independent originator and its processing and servicing capacity (rebranded as “Findex”) will be used as part of an Absa “direct to real estate” strategy, in conjunction with Absa’s internal sales force.

So the news vine says that Absa will not accept any home loan business post 1 December 2010, for LTV’s in excess of 40%, from any originators or aggregators other than from estate agencies that sign a direct contract with Absa and that are willing to have the homebuyer’s application processed by “Findex”.

Once again, we see the true colours of a very powerful bank as they step forward to control the market.  I wonder how much they paid Nedbank for their share of Bondchoice ooops Findex!!

Watch the switching of homeloans go bezerk as people freak out about the control that ABSA puts on them.

So because they are not making the profits they should, defaults are at a high, PIP's are just too much, well why not get rid of the force that does all your screening, work and provides you with the best cleint base - hell lets get rid of them and own the balance.

The freedom of choice by using your financial consultant is being whipped away and now you have no choice but to use a prescribed force...I think someone has made a big mistake here!

Lets see...eeeeeish!

36 comments:

Anonymous said...

Hello!!! I have been in the employment of ABSA bank for many many years. The sad thing is that they are moving away from their own clients or client base for which I have worked so hard to get on too their books. I left ABSA's employment due to the buddy buddy system that was the in thing and then joined another banking group whom I have also served successfully but who have lost the passion for service delivery along the way. I have been in the originating business and worked mostly indepentdently for the past 6 years but know all or most of the aspects of bond finance residential or commercial/industial not to even mention developments and where did I gain my experience? Needless to say I have done bonds from the time that you could only secure a bond by way of match lending in the 1980's to where we are today. The people that are now employed to serve the puplic has express experience.. hello I am not an express consultant I am an experienced consultant. i do not use one bank I shop at all banks and SA Homeloans/ sorry for all but also at the biggest property owning Bank in KZN namely Ithala bank. So people when I say to you I give you the undertaking that I will secure you with the best deal I do it honestly. Please feel free to contact me on 082 886 3783..kind regards Natalie

Anonymous said...

Absa is obviously trying to control the market and will be trying to take not only mortgage business but other business as well from the other Banks. I am more than sure their Loan Consultants /Findex will be instructed to screen the applications and make sure that the high value clients and applications are all sent to Absa. They will then get the best bonds as well as a client they can approach to obtain his other banking business. They won’t even have to relax their lending criteria!
I am sure SBSA , Nedbank and FNB will not let this to happen and will continue to allow the client a freedom of choice.
The bigger they are or try to be the harder they fall!!!

Mike the Spike.

Anonymous said...

Absa tried to dictate who must play for the Springboks and now they are wanting to dictate to their clients who they must use to get them the best Mortgage Bond!!

Ex Absa client.

Anonymous said...

http://absaabsaabsa.blogspot.com/

HA HA HA HA!! Man thats great
Geoff S.
also ex-ABSA client

Anonymous said...

Ag nee wat!! Ek verlang na jou

A(ltyd)
B (laf)
S (y)
A (gterend)

my maatjies

KK

Anonymous said...

I’ve been informed that one of the reason for this move is the ABSA is upset by the bond originators taking their clients to other banks.

Through bond originators, every bank has an equal opportunity at gaining, keeping or loosing a client. Most often than not, bond originators give the client’s bank an opportunity to meet what the other banks are offering, if ABSA didn’t agree to meet a better offer, why now blame the bond originators?

This move is a clear indication that ABSA wants to avoid having to enter into fair competition, to the detriment of their clients.

Jason said...

ABSA - QUO VADIS??

For many months mortgage originators were not allowed to submit applications to Standard Bank because the bank was in dispute with the mortgage origination companies OOBA and Bondchoice. We nevertheless managed to survive. (OOBA / BondChoice are still not permitted to submit applications to Standard Bank!)

Subsequently we were all hit by the slump in the property market / recession. Still we survived.

Then the banks decided to drastically reduce the commission paid to mortgage originators. A fair number of us have nevertheless survived.

Now, with very little prior warning, we are informed that ABSA will no longer be accepting home loan applications from mortgage originators where the loan-to-value is more than 40%!! (In other words, we can only submit to ABSA if the client wants a bond of 40% or less of the purchase price! How many clients do you think are able to put down a 60% deposit??)

ABSA will, however, be using the services of FINDEX (previously BONDCHOICE) who will be "the exclusive provider to ABSA bank for all sales, support, processing and conversion of home loan applications arising as a result of their newfound relationships with the estate agent and third party market".

Once again, and with very little prior warning, a bank is attempting to muscle out the Mortgage Originators AND dictate to the client through whom he may submit his home loan application. Are we not the "third party market" to which they refer?? Certainly no-one from BondChoice has tried to discuss this with me or entered into a "newfound relationship" with me.

We have been Mortgage Originators since July 1996. We have built up very many long-standing and valued relationships with clients over the years. If these clients wish to apply to ABSA for their home loans in future they will NOT be able to approach us for assistance!! It is not unheard of that big corporations try to remove customer choice but they need to be aware of things like competition law, monopolies and cartels - it is also not unheard of that big corporations get a big smack and have to back down!

This is typical though – just as the market starts looking a little better ABSA pull this stunt! Anyway, does anybody honestly think they will be able to have EVERY estate agency in the country signed up by 01st December?

As mortgage originators we need to stand together and defend ourselves. In this case, knowledge is the best weapon. Educate yourselves and educate your clients. Make sure they know what this is going to mean for them. Force your ABSA liaison to engage with you and give you answers. They need to be aware that there is discontent out there.

Scarlet Pimpernel

Anonymous said...

ABSA - QUO VADIS??

For many months mortgage originators were not allowed to submit applications to Standard Bank because the bank was in dispute with the mortgage origination companies OOBA and Bondchoice. We nevertheless managed to survive. (OOBA / BondChoice are still not permitted to submit applications to Standard Bank!)

Subsequently we were all hit by the slump in the property market / recession. Still we survived.

Then the banks decided to drastically reduce the commission paid to mortgage originators. A fair number of us have nevertheless survived.

Now, with very little prior warning, we are informed that ABSA will no longer be accepting home loan applications from mortgage originators where the loan-to-value is more than 40%!! (In other words, we can only submit to ABSA if the client wants a bond of 40% or less of the purchase price! How many clients do you think are able to put down a 60% deposit??)

ABSA will, however, be using the services of FINDEX (previously BONDCHOICE) who will be "the exclusive provider to ABSA bank for all sales, support, processing and conversion of home loan applications arising as a result of their newfound relationships with the estate agent and third party market".

Once again, and with very little prior warning, a bank is attempting to muscle out the Mortgage Originators AND dictate to the client through whom he may submit his home loan application. Are we not the "third party market" to which they refer?? Certainly no-one from BondChoice has tried to discuss this with me or entered into a "newfound relationship" with me.

We have been Mortgage Originators since July 1996. We have built up very many long-standing and valued relationships with clients over the years. If these clients wish to apply to ABSA for their home loans in future they will NOT be able to approach us for assistance!! It is not unheard of that big corporations try to remove customer choice but they need to be aware of things like competition law, monopolies and cartels - it is also not unheard of that big corporations get a big smack and have to back down!

This is typical though – just as the market starts looking a little better ABSA pull this stunt! Anyway, does anybody honestly think they will be able to have EVERY estate agency in the country signed up by 01st December?

As mortgage originators we need to stand together and defend ourselves. In this case, knowledge is the best weapon. Educate yourselves and educate your clients. Make sure they know what this is going to mean for them. Force your ABSA liaison to engage with you and give you answers. They need to be aware that there is discontent out there.

Scarlet Pimpernel

Anonymous said...

ABSA - QUO VADIS??

For many months mortgage originators were not allowed to submit applications to Standard Bank because the bank was in dispute with the mortgage origination companies OOBA and Bondchoice. We nevertheless managed to survive. (OOBA / BondChoice are still not permitted to submit applications to Standard Bank!)

Subsequently we were all hit by the slump in the property market / recession. Still we survived.

Then the banks decided to drastically reduce the commission paid to mortgage originators. A fair number of us have nevertheless survived.

Now, with very little prior warning, we are informed that ABSA will no longer be accepting home loan applications from mortgage originators where the loan-to-value is more than 40%!! (In other words, we can only submit to ABSA if the client wants a bond of 40% or less of the purchase price! How many clients do you think are able to put down a 60% deposit??)

ABSA will, however, be using the services of FINDEX (previously BONDCHOICE) who will be "the exclusive provider to ABSA bank for all sales, support, processing and conversion of home loan applications arising as a result of their newfound relationships with the estate agent and third party market".

Once again, and with very little prior warning, a bank is attempting to muscle out the Mortgage Originators AND dictate to the client through whom he may submit his home loan application. Are we not the "third party market" to which they refer?? Certainly no-one from BondChoice has tried to discuss this with me or entered into a "newfound relationship" with me.

We have been Mortgage Originators since July 1996. We have built up very many long-standing and valued relationships with clients over the years. If these clients wish to apply to ABSA for their home loans in future they will NOT be able to approach us for assistance!! It is not unheard of that big corporations try to remove customer choice but they need to be aware of things like competition law, monopolies and cartels - it is also not unheard of that big corporations get a big smack and have to back down!

This is typical though – just as the market starts looking a little better ABSA pull this stunt! Anyway, does anybody honestly think they will be able to have EVERY estate agency in the country signed up by 01st December?

As mortgage originators we need to stand together and defend ourselves. In this case, knowledge is the best weapon. Educate yourselves and educate your clients. Make sure they know what this is going to mean for them. Force your ABSA liaison to engage with you and give you answers. They need to be aware that there is discontent out there.

Scarlet Pimpernel

Anonymous said...

ABSA - QUO VADIS??

For many months mortgage originators were not allowed to submit applications to Standard Bank because the bank was in dispute with the mortgage origination companies OOBA and Bondchoice. We nevertheless managed to survive. (OOBA / BondChoice are still not permitted to submit applications to Standard Bank!)

Subsequently we were all hit by the slump in the property market / recession. Still we survived.

Then the banks decided to drastically reduce the commission paid to mortgage originators. A fair number of us have nevertheless survived.

Now, with very little prior warning, we are informed that ABSA will no longer be accepting home loan applications from mortgage originators where the loan-to-value is more than 40%!! (In other words, we can only submit to ABSA if the client wants a bond of 40% or less of the purchase price! How many clients do you think are able to put down a 60% deposit??)

ABSA will, however, be using the services of FINDEX (previously BONDCHOICE) who will be "the exclusive provider to ABSA bank for all sales, support, processing and conversion of home loan applications arising as a result of their newfound relationships with the estate agent and third party market".

Once again, and with very little prior warning, a bank is attempting to muscle out the Mortgage Originators AND dictate to the client through whom he may submit his home loan application. Are we not the "third party market" to which they refer?? Certainly no-one from BondChoice has tried to discuss this with me or entered into a "newfound relationship" with me.

We have been Mortgage Originators since July 1996. We have built up very many long-standing and valued relationships with clients over the years. If these clients wish to apply to ABSA for their home loans in future they will NOT be able to approach us for assistance!! It is not unheard of that big corporations try to remove customer choice but they need to be aware of things like competition law, monopolies and cartels - it is also not unheard of that big corporations get a big smack and have to back down!

This is typical though – just as the market starts looking a little better ABSA pull this stunt! Anyway, does anybody honestly think they will be able to have EVERY estate agency in the country signed up by 01st December?

As mortgage originators we need to stand together and defend ourselves. In this case, knowledge is the best weapon. Educate yourselves and educate your clients. Make sure they know what this is going to mean for them. Force your ABSA liaison to engage with you and give you answers. They need to be aware that there is discontent out there.

Scarlet Pimpernel

Anonymous said...

If this was a simple matter of the cyclical nature of business it would be understandable. Although not exactly a model for innovation or future-growth it often happens that market trends revert to what they were previously. In ABSA’s case this is probably down to the fact that there are a lot of highly paid people with very few new ideas between them. Remember when they were going to do all their own conveyancing? What happened to that idea? Instead of investing money and effort in improving their service to the client at every level (who has been satisfied with a visit into a bank branch recently??) they simply try to squeeze the very last drop of blood from this stone.

This is indicative of the cold-blooded nature and pig-headed stubbornness of this particular institution. All of the banks bought into mortgage origination. In ABSA’s case this allowed them to streamline their operations and cut a lot of jobs. How many of you out there are ex bank employees?

Now they are trying to re-invent the wheel. They obviously don’t mind working with mortgage originators as they are happy to use BondChoice/Findex. But the agenda is obvious – CONTROL. They need a compliant, controllable and direct source of business – the idea is that ABSA will then have first crack at all new business. But how will they service Standard Bank clients, for instance?

Once again, the freedom to choose is being eradicated by the money-grubbing hypocrites who put us in this position in the first place!!

Che Guevara

Anonymous said...

http://www.dieburger.com/Suid-Afrika/Nuus/Solidariteit-en-kie-groet-Absa-oor-hy-hul-lojaliteit-nie-verdien-20101104

Dis niks, ABSA probeer nou ook om die eiendoms mark te monopoliseer. Die kliĆ«nt word nou gedwing om sy verband aansoek deur sy nuut geskepte maatskappy “Findex” te plaas of direk by die bank self om vir 100% lening te kwalifiseer anders sal slegs 40% van die waarde van die eiendom toegestaan word indien die aansoek deur enige ander kanaal ingedien word. Die verwysende eiendoms agente moet ook nou by “Findex” geregistreer word. Hoe eties is dit, moet die mededingens kommissie nie dalk hierna kyk nie want dit is nou die verbruiker wat weereens te nagekom word. Ek het self vanoggend my rekeninge gesluit en is besig om my verbande te “switch” na ‘n ander finansiĆ«le instelling. ABSA maak my nou bitter de moer in.

SEO said...

I was also an ABSA client and got pushed around from pillar to post. Too much money wasted on irrelevant sponsorship, not enough on looking after clients and securing the future of their staff. Look at what Capitec's doing - keeping it real and focusing on what customers want .. great service, low fees and relevant products.

Anonymous said...

The latest rumour is that Findex has signed 2 of the other big banks too. I very much doubted that the Bond Choice guys would have gone only the way of ABSA. One more bank to get on board and then they are a regular MO that supports ABSA as bank of first choice!

transaction management realtor said...

Hope to read more updates on your site soon.

Anonymous said...

You can still apply with Absa directly!

Anonymous said...

Great move ABSA. It is about time to cut the tail that waggs the dog. This may upset the property industry for a while but I truely think the landscape has changed today. I just hope other big banks have the guts to follow through. Maybe the banks will reward you for comming directly by reducing your initiation fee and offer you a better rate as their cost structures reduce.This will save me much more than the discount the originator can negotiate given their cost lay out.I can go where I want to direcly and then I know I got all the responses I wanted and not only the ones that will benefit the wallet of the originator.

What a lot of people do not realise is that these "middlemen" create layers of cost and have over time probably got involved in price wars, commision wars have been going on between banks to buy the business and then the originators offered customers cash back on loans that they often do not need.All of the above ended up in the margin of banks. In more plain terms this makes your loan and initiation costs more expensive.

Shop around talk to your banker and you will be suprised to see what you actually miss out on by going through an originator. Doing a quick search, Standard Bank offer better offers and rates to customers who come direct, We all know what ABSA did not sure what the incentive to the customer is, FNB offer move your home not your home loan benefits to customer comming direct that can save you stacks of money over time especially if you young starting out and likely to buy a couple more homes over time. The One Account product is also only offered via direct channels in FNB.

It is clear that this move is not something that happened last night. Banks seems to be looking for a way to regain the power in sourcing their own deals and to service their own customers. This is evident in the product offering via their direct channels.

You have the right to amend your offer to purchase and to remove the clause directing your detail to an originator to apply to banks on your behalf. You can go direct to your bank and save. In my experience they have qualified consultants that will come to your house and place of work just like the originator will do. Difference here is they are managed by the bank and dependant on the bank for their income. A service failure here will allow you with alternative escalations and complaints processess that you will not find in an ungoverned origination business. Who is their governing body?

Anonymous said...

Great move ABSA. It is about time to cut the tail that waggs the dog. This may upset the property industry for a while but I truely think the landscape has changed today. I just hope other big banks have the guts to follow through. Maybe the banks will reward you for comming directly by reducing your initiation fee and offer you a better rate as their cost structures reduce.This will save me much more than the discount the originator can negotiate given their cost lay out.I can go where I want to direcly and then I know I got all the responses I wanted and not only the ones that will benefit the wallet of the originator.

What a lot of people do not realise is that these "middlemen" create layers of cost ending up in the interest rate margin of banks. In more plain terms this makes your loan and initiation costs more expensive.

Shop around talk to your banker and you will be suprised to see what you actually miss out on by going through an originator. Doing a quick search, Standard Bank offer better offers and rates to customers who come direct, We all know what ABSA did not sure what the incentive to the customer is, FNB offer move your home not your home loan benefits to customer comming direct that can save you stacks of money over time especially if you young starting out and likely to buy a couple more homes over time. The One Account product is also only offered via direct channels in FNB.

Banks seem to be looking for a way to regain the power in sourcing their own deals and to service their own customers. This is evident in the product offering via their direct channels.

You have the right to amend your offer to purchase and to go direct to your bank and save. In my experience they have qualified consultants that will come to your house and place of work just like the originator will do. A service failure here will allow you with alternative escalations and complaints processess that you will not find in an ungoverned origination business. Who is their governing body?

"The MAGE" said...

Well no need to panic. There are ways to do business and for me to use my own originator or finance broker just makes sense. I reallu=y could not be bothered running to banks who really do not understand me or my business.

Anonymous said...

This stupid move by ABSA will die a very quick death if the current levels of business are anything to go by. Do they really think bullying and forcing people to do business with them is the best way to keep or gain clients? They have done nothing to improve service levels and these were already about the worst of all the banks. The other 3 are making a lot of money now at ABSA's expense and must be looking forward to their next brainfart!!!

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Personal Loans said...

Tough being a mortgage originator in these tough trading and competitive conditions.

Personal Loans said...

I think the hardest part of the loan origination business these days is that when a bank approves a loan, it only cover the house purchasecost, leaving people with little cash if they want to refit their house. Which means they have to look for another form of finance. A shame as it means the originator loses the extra com they could make by selling a larger loan, while disadvantaging the consumer who now has to manage loans from multiple providers.

Loan said...

Just responding to Personal Loans above .. yes, managing multiple loans can be cumbersome. Maybe you need to look at some form of consolidation loan so you reduce your monthly admin (and monthly admin payments)

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