New mortgage website allows lenders to "bid" to win customers' business

New mortgage website allows lenders to
New mortgage website allows lenders to "bid" to win customers' business

A new Australian website, calling itself a world first, has been launched that will help prospective property owners crowd source their mortgage and skip brokers.

The site, which began as an idea in 2010 and is now called Flongle, sees borrowers anonymously post what they want in an ideal mortgage. In response, banks, non-bank lenders and brokers “bid” to obtain the customer’s business. Flongle is presenting this as a mortgage “contest”, whereby the lender ‘wins’ the client.

Michael Lee, who is behind the website and comes from the mortgage industry, said that it provides an unbiased way to see out a deal before choosing the one that best meets their needs and at the lowest price.

The site notes that they include 2,500 plus mortgage deals “below retail” that are exclusively discounted. Each of the “Flongle deals” is noted as pre-approval insured as each bid is prepared by a human being. It comes with some hefty testimonials too, with Money Magazine and Barefoot Investor Scott Pape quoted on their site.

Flongle does not take commissions from lenders, with consumers instead paying. It costs $399 for a prospective borrower to undertake the service, or they can up their cost to $799 for a mortgage expert to guide you through the process. This comes with a money back guarantee that they’ll get the loan that fits their need at the best possible price or they will receive a refund.

Their ‘mortgage contests’ run for up to seven days, and they note that it can attract hundreds of bids. Currently registered are more than 50 lenders and mortgage brokers that have been verified by Flongle. Flongle will also rank the bids based on how they match the requirements noted by the borrower, and the costs (including hidden fees) using a proprietary technology.

“For too long, consumers have been baffled by choice, complexity in pricing, an array of similar, but not necessarily the same features and some outrageously dishonest advertising and promises, which, largely, go unchecked,” said Lee, who believes Flongle gives the power back to the borrower.

They note that as commissions and incentives are not required to be disclosed by brokers, which add up to $2.1 billion paid out annually to Australian brokers, this adds transparency to the process.

“The mortgage is without a doubt the biggest household expense for most Australians and yet too many people are on dud deals that leach away at their wealth and happiness,” Lee said. 

“Despite the massive impact their mortgage has on their wealth, most Australians just don’t have the time to learn what they need to know, let alone to apply it – which means they wind up handing their biggest and most important financial decision over to a salesperson.”

Lee said that the reality is that bias from brokers can cost consumers thousands if they pick based on commission rather than based on the genuine best deal for the borrower.

Those looking for new home loans, to health check or to refinance can use the service, with your mortgage call out taking less than two hours to make.

Lenders currently listed on the site include Commonwealth Bank, St George Bank, BankSA, ING Direct, Suncorp, Citibank, Heritage Bank, Westpac Bank, Bank of Melbourne, Newcastle Permanent, Homeside (NAB), ME Bank, The Rock Building Society, Plan Lending, National Australia Bank, ANZ Bank, BankWest, Resi, Macquarie Bank and Circle Credit Union.

The site is a wholly owned subsidiary of CQ Now Pty Ltd, and neither owns nor is owned by a lender or mortgage broker.

Jennifer Duke

Jennifer Duke

Jennifer Duke was a property writer at Property Observer

Tags: 
Mortgages

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