I Support My Broker!
Well if you have been hiding under a rock the last 2 days there has been the handing down of the Royal Commission by Mr Hayne. It sent shock waves through the mortgage broker industry literally. Overnight his recommendations was to cut all broker commissions both upfront and trail commissions.
It has recommended we charge an upfront fee for our service. Now as a consumer on a $500,000 loan would you pay $3,300 to use a broker when the bank charges nothing? How would a cash strapped First Home owner now afford another fee on top of their savings.
Then as a broker we bring business to a bank for free and the bank then makes about $359,347.53 on the loan over 30 years at a 4% rate. Wow that sounds fair!
As consumers then choose not to pay a broker fee and there are less and less brokers till they all RIP.
The big banks then take any competition away and have a monopoly between the big 6 banks. The banks all control the market moving the rates up and poor outcomes for the consumer.
The consumer does not know where to find the right loan that suits them, how to get reduced home-loan rates and how to get the bank to return their call. The amount of loans that brokers can help their clients achieve the goal of owning their first property or getting into their first investment or their 4th.
What a broker does to help out their clients is;
– We find them competitive rates
– Help out with all the paperwork
– Loan structuring
– Helping out with fixed rates
– Answering questions on repayments principle and interest V’s interest only
– First home owner grants and the paperwork and where to lodge
– Costings reports for proposed properties outline all the fees and charges
– calculating deposits needed
– explaining all the costs associated with loans, stamp duty, solicitors, etc
– loan lodgement (apply online)
– print loan documents
– sign up clients to mortgage
– answer the phone after hours
– go to our clients house or business to interview and provide information and sign applications etc.
– Understand complicated lending and structuring, with self employed clients, company and trusts
– provide help with chattel and car loans
– provide competition with the banks so they have to prove why they should win your clients business.
– help with investment property purchases
If you have had a loan just because the loan has settled as you probably know that is not the end of the service, well not for a broker, we check up on our clients, making sure the payments come out when they expect it, do annual reviews, handle and change of direct debts, fixing or any other think that is involved in the loan.
Sometime things happen in life, babies, loss of job, death, divorce and if you have a mortgage you probably ring your broker for help. This is all the after service that is the reason for the trail payments the commission does not think this things are warranted or the service we provide.
If we get rid of brokers competition is going to diminish, banks are going to lift rates and any savings you once had go into the bank’s profits, why do you think the stock market with all the banks rose by up to 10% for some lenders and that aggregators such as AFG and Mortgage Choice lost 25% of their share price over night.
We also have a shoulder to cry on and a smile and laugh to celebrate when the good times happen.
Brokers are all small business we provide a very good level of service, and we invest and spend a lot of our money with other small business.
Please support brokers!