Non-bank lender Athena Home Loans has launched a suite of tailored products designed for investor and self-employed borrowers after workshopping solutions with brokers.
The tailored product suite launched today comprises three products:
The products are packaged under the white label Mortgage Choice Freedom range; and the Athena suite is sold exclusively through the Loan Market Group (LMG) broker network.
As of July, all Athena products are also listed on the serviceability aggregator Quickli.
Athena CEO and co-founder Nathan Walsh (pictured above) said brokers can expect “best in market” SLAs, “market leading” digital customer experiences, competitive cost structures and supported pathways to Premium Prime products.
“We are extending our offering for investor and self-employed borrowers – a segment of great borrowers who need flexibility and who have often been unfairly penalised,” Walsh said.
While other non-banks have ventured into these segments before, Walsh said most tailored products in the market are “pretty basic”.
“How many give multiple offsets? How many give a full mobile app experience to borrowers? How many give brokers access to a full-portal experience that has great service and speed?” he said.
“These are fully featured products. We co-designed our Tailored product experience directly with brokers to deliver on the underserved needs of this sophisticated borrower cohort.”
For example, the self-employed lite doc is designed for borrowers where the timing of their business finances (such as tax returns) doesn’t align with making a move on their housing finance.
“It just gives borrowers multiple pathways where you can go down and establish income,” Walsh said.
“The declaration can be an accountant’s letter, six months BAS statement or three months of business transactions. So you are really getting flexibility for borrowers to establish their financials as opposed to the full-doc experience.”
While lender’s mortgage insurance (LMI) typically applies to above 80% LVR in most products, Athena’s new product reduces the threshold for no LMI to 85% LVR.
“This product helps clients who are strong borrowers but often have cash tied up in other ventures and don’t want to delay in getting into the market or want increased flexibility but without the cost of LMI,” said Walsh.
It comes after ANZ launched its own LMI waiver product in May. However, this is only available to Australia’s most lucrative suburbs.
“The non trading trusts is ultimately for investors and the self-employed who are looking to structure how they hold their property investments,” said Walsh.
What sets Athena’s offering apart is the direct collaboration with brokers in designing these products.
Starting mid-last year, Athena engaged in workshops and pilot programs with key broker partners to optimise product design, service, policy, and to understand market pain points.
“There’s a very broad aspect of feedback that’s been embedded back into the product that we launch today,” said Walsh.
Here are some other more specific ways this broker feedback resulted in better products for borrowers:
Brokers valued the ability to offer product pathways for evolving borrower needs.
Walsh said simplifying the transition from a lite doc to a full doc product once borrowers are able to provide tax returns is a significant improvement over the traditional process.
“You think about many business owners may not be in a position to provide a tax return but making that easy product switch is a real game-changer for our broker partners,” said Walsh.
“It’s something quite different in a world where you have to go from one partner for a lite doc product and go to another for a full doc and have to do the process again.”
Brokers wanted products that recognised the nuances of the self-employed market.
“Personalised pricing is just recognising that not all business owners are the same,” said Walsh. “We should be fairly rewarding customers with business expertise with the rate that reflects their situation.
“Don’t treat a seasoned business owner the same as someone who is just starting out in terms of risk and other characteristics.”
Acknowledging Quickli’s importance in broker processes, Walsh expressed gratitude for brokers in getting Athena products onto the platform.
“We’d love to give a big thanks to our brokers for their advocacy in getting us onto that platform,” said Walsh. “Their voice is a really big part of getting additional lenders onto Quickli.”
Athena and their broker partners also considered small but significant details, such as ensuring accountant letters confirm historical financial accuracy rather than forecasting future earnings.
“What are you actually asking an accountant to sign up for on an accountant’s letter? Knowing how to make accountant more comfortable makes the broker’s life easier when meeting the requirement,” Walsh said.
Collaboration with brokers is something that is central to Athena’s view on how to target the market.
“We are really looking to change home loans for good, and the best way to do that is to understand the critical role that brokers have in the home loan process. We must understand and value the expertise they bring and actively partner with them.”
As brokers break market share records writing over 74% of new loans originated, Walsh said this type of co-designing approach shouldn’t be controversial.
“But it’s interesting how so many lenders miss why that’s such a big positive for consumers because of the role brokers play,” he said.
“So much of our current proposition and success working with our aggregator partners is a story about brokers just calling out opportunities to do things differently.”
