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Plenty of room for improvement for mortgage brokers

CHOICE Magazine – By Uta Mihm

Kat Lane was on the expert panel for Choice’s Mortgage Broker Shadow Show.  Choice sent five home buyers to three of the biggest mortgage broker businesses in Australia and found that home buyers should take a close and critical look at what their brokers come up with.  The sample was small, but Choice found few examples of good practice.  Instead, the shadow show borrowers encountered pressure sales tactics, inappropriate advice, lack of commission disclosure and upselling with little consideration of risk.

The entire CHOICE Magazine article can be read here: Mortgage Broker Shadow-Shop

 

Related News Stories:

Mortgage broking needs urgent reform, claims banking association

Brokernews.com.au – by Julia Corderoy

The Customer Owned Banking Association (COBA) is calling for the Financial System Inquiry to restore trust in mortgage brokers, after findings of the Choice “shadow shop” of mortgage brokers claimed borrowers encountered “inappropriate advice” from brokers. “Consumer groups have this week put the spotlight on some poor behaviour by mortgage brokers. CHOICE, the Consumer Action Law Centre (CALC) and Financial Rights Legal Centre are calling for an investigation of the mortgage broking market, focusing on commissions and disclosure,” COBA CEO Mark Degotardi said.

 Industry deplores calls for ASIC investigation

The Adviser – by Huntley Mitchell

Three of the industry’s biggest groups have hotly denied allegations that their brokers are not complying with credit rules. Consumer advocacy group Choice has called for the corporate watchdog to undertake an investigation into the mortgage broking industry. Choice, together with the Consumer Action Law Centre and Financial Rights Legal Centre, has called on the federal government to increase funding to ASIC so that it can begin investigations into the third-party channel.