At first glance, people reading the news about mortgage brokers in this post-Royal Commission
climate could assume that mortgage brokers are the bad guys in a Robin Hood-esque scenario
that has pitted financial institutions against the average Australian.
But it’s important to dig a little deeper and examine where the real issues lay.
Although it is the biggest of our banking giants whose fees and charges deserve to come under
close scrutiny, it seems the loan brokers who make it their business to find better deals for
lenders that have been made the unwitting scapegoats.
But with some banks proven to be charging exorbitant fees to everyday Australians trying to
secure the finance they need to make their lives better, don’t we need experienced, ethical loan
brokers and mortgage brokers more than ever?
Support For Mortgage Brokers
In the news articles that have flowed since the findings of the banking Royal Commission were
announced last week, it’s positive to see both lenders and aggregators actively supporting the
Mortgage and Finance Association of Australia’s (MFAA’s) recently-launched campaign to
defend mortgage brokers.
This grassroots campaign is all about encouraging Australians to seek out their local MP and
write a letter of support for an industry that has its heart in finding the best possible deal for
customers.
It’s all about making sure the big banks don’t kill the competition that currently exists in the
lending sector – the same competition that helps consumers of loan products shop around and
find lending solutions that are tailored to suit their unique circumstances.
A proposal to create a ban on broker commissions paid by lenders is a knee-jerk reaction being
suggested without talking to the thousands of happy mortgage broking clients who know they
have secured better finance deals because of the advice and support a professional mortgage
broker has shared.
Although the complete abolition of trail commissions and the removal of upfront commissions, in
favour of a borrower-pays structure, makes it seem like borrowers are being looked after, the
fears for the mortgage broking industry include the reality that clients will lose their ability to
shop around and source deals that suit their individual situations – something that will have a
very real impact on borrowers who may not meet the exact demands for lending criteria that a
monopoly of big lenders will become stricter about enforcing.
Lack of Choice Costs More
With Treasurer Josh Frydenberg announcing that the government will remove trail commissions
from 1 July 2020, the future for tomorrow’s borrowers is at risk and with less loan choices
adding up to costlier loans that will have a significant impact on household budgets for ordinary
families, making your voice heard to the people in power is a smart strategy to regain the
freedom that access to mortgage broking support has previously offered.
MFAA data showing that 59.1% of home loans were introduced by mortgage brokers reveals
the reality that Australians appreciate having plenty of lending options but with the threat of
reduced choice, home ownership dreams of the next generation of potential home-owners could
be put on hold unless action is taken.
To help support the industry that supports you, go to https://www.brokerbehindyou.com.au
and sign the petition.
For advice about how a mortgage broker can give you greater access to better deal on
your next loan, talk to our loan broking professionals at Lending Specialists today.
