FBAA calls for brokers to be proactive

by Miklos Bolza17 Oct 2017
Brokers should be on the front foot in an environment where many financial experts predict that the official cash rate will remain steady for the near future.

This call to be proactive was proffered by executive director of the Finance Brokers Association of Australia (FBAA) Peter White who said that borrowers need to be assured that their loans were still suitable for their needs.

“One of the best things people can do is ensure the interest rate structure on their loan is suitable for their future and that’s where brokers can help,” he said.

Brokers can advise borrowers and assist with their short or medium-term plans to see whether a fixed or variable rate was most suitable, he said.

“If they have no immediate plans to change their borrowing needs for renovations, extensions or the like for the next two to three years, fixing their interest rate for that period may be a good option with many fixed rates sitting at below four per cent.”

A part fixed, part variable rate loan structure would be more suitable for those who want to hedge their bets on all fronts, White said.

“The key is to wait for the best time to do it and that may be another six to ten months down the track.”

With uncertainty playing out in the home loan space, brokers were the best placed professionals in the finance industry when it comes to guiding borrowers towards the best outcomes, he said.

Related stories:

Brokers writing fewer IO loans

Gov’t “encouraged” by broker review response

Sedgwick broker proposals “complicated”: ANZ