Property: Mortgage broker rejects bank lender's claims

Chris Hutching

Friday 30th April 2004

One of the country's leading mortgage brokers, Miranda Caird of Mortgage Choice, disputes BNZ's advertised claim that it can provide mortgages more cheaply to home borrowers than mortgage brokers.

"If they're employing their own staff they have to pay them somehow. It all comes from margins. BNZ is simply trying to raise the bar (with its latest advertising campaign) but it's silly behaviour. We can provide an unbiased view of the market and we can still get a better deal than what they're offering," Caird said.

Caird said she believed her rival, Mike Pero Mortgages, had "rattled the cage" by announcing its plan to list on the Stock Exchange

It was a timely coincidence that BNZ's latest advertising campaign against brokers has been launched at the same time as Mike Pero Mortgages goes to the market to raise $7-10 million ahead of a planned Stock Exchange listing. Mike Pero Mortgages has 35 franchises and Mortgage Choice has 30.

But BNZ's rejection of the broker system is not new. The bank opened its campaign more than a year ago.

Caird said that over the past year little had changed in the market except that BNZ had declined to work with brokers. If BNZ had picked up any new business it was because it had liberalised its lending criteria to be more in line with other lenders and had been prepared to "buy" market share.

Meanwhile, Pero was busy on the road this week promoting the Mike Pero Mortgages investment offering that provides him with an exit from the company he founded in the early 1990s.

Recently, Christchurch businessman George Gould bought 90% of Pero's interest for $13 million. After the issue of the 7 million new $1 shares, Gould Holdings will own 61% of the company, Pero will hold 7% and the balance will be held by public.

Pero and lead broker Greenslades, of Dunedin, were this week holding a series of investor and financial adviser briefings.

It is unclear what high flyer Pero's focus will be after the launch of the company on the Stock Exchange in May but in February he registered a company called Pacific Express Airlines with the Companies Office (he formerly operated a one-plane company called Airlink Services that transported commuters between Christchurch and Timaru).

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