I am not a Mortgage Broker but I am the recommendations delivered by the Royal Commission and the impact this is having on the industry really personal.
We work with an amazing panel of professionals in the Booking space. These are small-business operators who work tirelessly to get a deal over the line for clients.
They are passionate about helping homeowners and investors and are a major team player when tying up the purchase of a property.
Just to provide some clarity around what Brokers do ( beyond just sourcing a mortgage )…
- Brokers have access to many lenders and help identify what suits you, your budget, your strategy with the lest degree of difficulty.
- The rules placed on lending over the past couple of years have made this service very specialised, they need to seriously understand the loans, lenders, and costs to the client (hidden fees!) and need to undertake ongoing professional development
- Brokers work really unsociable hours, often outside of the 9-5, they impart hours of knowledge, mentoring and support to clients
- They chase and compile documents, I applied for a loan 2 weeks ago and had to provide 36 documents, THIRTY-SIX, guess who prodded me along the way – my Broker
- They don’t get paid a cent unless their clients make a property purchase
- If a client refinances a loan within a couple of years, the Broker gets a ‘clawback’ so all the work they did upfront turns to expensive goodwill
So what does this mean for you?
You can read more here about some of the changes proposed.
In short, if the banks don’t pay for the Mortgage Broker, then the consumer does.
Many people who are only just able to get a deposit together will be seriously disadvantaged as they rely on a bank branch or an online search tool to find a loan.
I can tell you now, an online search tool or a random call to a banks customer service center will not take the time to explain the process, they won’t do any “nice” things, like run an RPData report, refer a Solicitor or a great Buyer’s Agent or removal company.
They won’t remind you 4 times to please send in your signed forms, they won’t visit you at home at 8pm on a Tuesday, they won’t chase approvals on your behalf or valuations, they simply won’t be as accessible.
The situation for the banks is just awesome. They no longer pay for the broker fees but get the business. When the consumer goes direct to a bank you can bet it is one of the 4 majors.
The smaller lender options will be unknown to the inexperienced buyer. The banks will have the power, they now also have reduced competition #winning!
We can make some noise, support Brokers, sign the petition.
I am meeting with the CEO of the MFAA ( Mortgage & Finance Association of Australia ) because I want to know what we can do as consumers, as investors, to support this industry.
Email me if you want me to be your voice too.
We are a big community here at Property Women. Let’s find out how we can help to turn this train wreck around.
My rant is over for now but as a homeowner, investor, property educator, investment and strategist and buyer’s agent I need to be taking this personally.