Will open banking affect how my loan will be processed?

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Rudy
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Joined: Wed Aug 28, 2019 6:45 pm

Will open banking affect how my loan will be processed?

Postby Rudy » Wed Aug 28, 2019 6:46 pm

Was reading around some fintech news, and came upon this topic called ‘open banking.’ Will this affect how my home loan will be processed?

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Otto Dargan
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Re: Will open banking affect how my loan will be processed?

Postby Otto Dargan » Wed Aug 28, 2019 6:57 pm

Hello Rudy. Welcome to the forums.

Open banking is the practice of sharing your financial data electronically, securely and with your explicit consent. The objective is to give you complete access to data that has been collected by banks and financial institutions under the Consumer Data Right established in 2017.

Open banking can speed up the home loan process by offering an automated process of getting all your required loan documents under one roof, instead of having to manually gather the information. The banks and lenders could easily look up information about your accounts, and assess if you qualify for a home loan and even give you recommendations on which loan would best suit your needs.

Besides faster loan processing, open banking can:
  • Get you real-time quotes on interest rates and terms of your credit cards, home loans and other financial products as lenders will have all the information needed to provide you with an accurate quote.
  • Improve your ability to compare and switch between products and services.
  • Encourages competition between service providers, leading not only to better prices for customers but also more innovative and tailored products suited to their needs.
  • Smaller lenders and fintech lenders will have all the data they need to compete toe to toe with the major banks, who currently hold all of this data.
Speak with one of our award-winning specialist mortgage brokers today to get the best deal on your home loan by giving us a call on 1300 889 743 or by filling in our free assessment form to find out if you qualify for a competitive home loan.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Rudy
Posts: 3
Joined: Wed Aug 28, 2019 6:45 pm

Re: Will open banking affect how my loan will be processed?

Postby Rudy » Wed Aug 28, 2019 7:11 pm

How will this bring a better option for me regarding home loans?

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Otto Dargan
Mortgage Specialist
Posts: 7654
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
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Re: Will open banking affect how my loan will be processed?

Postby Otto Dargan » Wed Aug 28, 2019 7:16 pm

Hi Rudy,

Every financial transaction will be scrutinized - this means banks and lenders will get an exact figure and not just a ballpark figure of your spending and saving habits. A more reliable assessment of expenses and income and accurate borrowing power calculation will lead to faster assessment and tailored home loans and get better deals on your home loan.

Under open banking, you can provide access for all your banking data to your broker or lender. They can then see all your income, expenses, debts and balances.
  • This means a faster turnaround time to a better and accurate credit decision. In fact, your credit file often shows your income.
  • Being an existing customer of a lender becomes less of a benefit when applying for a loan. Now every lender can see the same data and knows who you are.
  • The UK launched open banking in early 2018 and it has proven that this system makes the home loan approval much faster.
Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Rudy
Posts: 3
Joined: Wed Aug 28, 2019 6:45 pm

Re: Will open banking affect how my loan will be processed?

Postby Rudy » Wed Aug 28, 2019 7:24 pm

How can I be assured that my data is safe and secure under open banking?

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Otto Dargan
Mortgage Specialist
Posts: 7654
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: Will open banking affect how my loan will be processed?

Postby Otto Dargan » Wed Aug 28, 2019 7:28 pm

Hi Rudy,

Financial data will only be shared with accredited financial institutions/individual, which means that they will need to be accredited with the regulator Australian Competition and Consumer Commission (ACCC) and adhere to strict security standards when assessing and storing your data.

The ultimate decision of sharing the data is at your sole discretion. These organizations will be subject to the ‘Privacy Act 1988’ and ‘Competition and Consumer Act 2010.'

We have over 40 lenders on our panel and thus can offer a wide range of home loan options and the most competitive rates.

Give us a call on 1300 889 743 or fill in our free assessment form to find out if you qualify for a home loan.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts


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