Consumers reveal biggest broker failing

by Julia Corderoy24 May 2016
Consumers are being let down by brokers post-settlement, a new survey has revealed, with more than half  of consumers affected by last year’s rate rises not contacted by their broker.

According to MPA’s 2016 Consumers on Brokers survey, 57% of consumers were not contacted at all about 2015’s rate rises, whilst 60% of those consumers who have never been contacted since settlement would like more communication from their broker.

Further, only 3% of those of those contacted monthly, and 7% if those contacted quarterly, would like less communication.

MPA editor Sam Richardson said this “woeful” service could result in a huge loss in potential business for brokers.

“Regularly contacting clients after settlement could generate not just refinancing enquiries, but a number of other revenue streams for brokers, our results suggest. 

“We asked borrowers whether they’d be open to getting services other than a mortgage from a mortgage broker, and only 17% said they would not be interested in this.”

Poor post-settlement service was actually a consumer’s biggest issue with mortgage brokers, not commission. This is despite the increased regulatory and media scrutiny on how financial services providers are remunerated.

According to MPA’s survey, 70% of consumers said being paid commission didn’t affect the service they received from their broker, a statistic relevant to ASIC’s review into mortgage broker remuneration this year. 

Almost half (47%) of consumers would also be willing to pay for their broker, albeit with an expectation of additional service, such as financial advice being included.

Read the full Consumers on Brokers report in MPA 16.06.