The latest figures from the MFAA’s quarterly market survey shows that brokers are still holding onto their stronghold over the home loan market in spite of heightened scrutiny from the media, royal commission, and other queries.
The market survey reveals that brokers originated 55.3 per cent of new residential loans in the March 2018 quarter, which is the highest share reported for any March quarter. It’s also up by 1.7 per cent from the December 2017 quarter.
Even though it was still lower than the record set in the September 2018 quarter (55.7 per cent), the CEO of the MFAA, Mike Felton recognises this as a data win for the mortgage broker industry.
This is especially positive in the aftermath of the Productivity Commission report released over the last quarter on 7 February and the start of the royal commission on 13 March.
In an interview, Felton said, “The consumer does not have a confidence deficit in the broker channel. We’ve seen that in the height of this the last three months it has continued to grow.”
He stated, “If consumers only see the negative in what is occurring in a channel, that confidence can at times be questioned. We believe that this data will demonstrate to the broker and to the broker’s customers that the channel is very sound.”
All the while, complaints regarding brokers have been moving downward. In the years 2016 and 2017, brokers made up 91 per cent of CIO members and accounted for only around 6 per cent of the agency’s complaints. Mortgage broker complaints at the FOS were equally inconsequential with less than 1 per cent of complaints to this office between 2013 and 2017.
Additionally, between 2010 and 2017, the ASIC investigated 140 broker incidents, of which only 15 resulted in conviction.
Mike Felton says he understands the frustration of brokers regarding the negative reporting to the public that affects the industry’s credibility. Especially since what they do doesn’t resemble what’s being reported in the media.
Felton expressed, “Consumers are telling you of the value they see in the mortgage broker channel and the outcomes that are being produced. Why would it be growing right in the height of the storm when the industry is being portrayed at its most negative, why would it continue to grow?”
The MFAA is already sending out this data campaign to the mainstream media, regulators, and to the government authorities and will keep advocating for mortgage brokers, according to Felton.
The MFAA also plans to post their research data findings on its website so brokers can choose to distribute the information to their clients.
The MFAA CEO said, “We believe from the data we have, like every industry, there will be wrongdoing, but it’s not at the core of our industry and there’s a great deal of incentive for brokers to behave appropriately given that their business models are based on relationships and positive outcomes.”
First Choice Mortgage Brokers are a Sydney Mortgage Broker operating under the Australian Credit Licence Number: 382370