Lender backs current remuneration model

by Rebecca Pike06 Dec 2018

A mortgage provider has backed the argument in support the current broker remuneration model.

Resimac, an amalgamation of Homeloans and RESIMAC, said it believes a flat fee borne by the consumer is not in their best interests.

The lender’s general manager of third party distribution, Daniel Carde said Resimac strongly supported the current model in conjunction with the six principles in the Combined Industry Forum (CIF) reform package.

He said this was because the underlying theme of the reforms was achieving better consumer outcomes and improved standards of conduct, while continuing to promote competition in the Australian mortgage market.

Carde added, “Over the longer term, this will further strengthen the broker proposition, ensuring consumers continue to benefit from strong industry competition and greater choice when accessing finance.

“Brokers are critical to ensuring Australia’s mortgage market is dynamic and efficient, and to providing a level playing field for lenders of all sizes, especially those without a branch network. Brokers provide consumers with access to a wide range of lenders and real choice when evaluating the most suitable loan for their purposes.”

Over the past year 85% of Resimac’s loans were originated by brokers. The Resimac Group has a mortgage book of more than $12billion and over 50,000 customers.

Carde said Resimac already complied with the majority of the CIF principles as it did not pay so-called soft dollar commissions or volume-based or campaign-based commissions.

Resimac’s next step will be to amend how upfront commissions are calculated to remove any perceived conflict that may encourage consumers to borrow more than they need.


  • by Jeff Royle 6/12/2018 8:40:01 AM

    As Resimac's biggest supporter in New Zealand I wholly agree. Fee for service being muted by the Banks can only benefit.....the Banks!

  • by Aaron 6/12/2018 9:13:36 AM

    imagine the irony that the royal commission to protect consumers could adversely impact borrowers for years to come. If Orr was fair dinkum she would have made Comyn look foolish for such self serving statements. The fact that she gave him free reign, perhaps even held his hand, speaks volumes for the hidden agenda we are all fearful of....Matt Comyn is selfish little man. He knows a flat fee will restore market share to the banks. He knows reduced competition will allow the banks to regain their margins. He knows this will impact every borrower in the country. He also knows his own pockets will be filled if flat fees become legislated. Selfish, greedy, and callous. Let's hope Orr was listening to everyone else as intently as she listened to Comyn....

    as I return home at 9:30pm last night, from two appointments/discussions with existing customers(that will produce zero income), and I arrived this morning before anyone else in the building(accountants,lawyers, physio's), I know I would not continue if there was even a minor reduction in our income. The workload for each file has increased 4 fold since I began whilst upfronts and trail structures have decreased. Yes, loan amounts have increased but the actual output per $ earnt has risen by at least 200%. Globally our remuneration does not compare favourably yet our workload is amongst the most onerous. It sickens me to to think of the work I do for a bank to prepare a fully packaged/data entered loan, and they would relish the opportunity to reduce my income by two thirds.... *&^% $#@

  • by A Nonymous 6/12/2018 9:54:35 AM

    What has changed pre RC break only a few months ago to now? I thought it was all agreed that the current model was OK. Even the government could not see anything that was detrimental with the current model. CBA has the most to lose seeing as they are being forced out of the broker business. No wonder they want to make changes against the status quo. If CBA doesn't want broker business, it won't have to try too hard based on all the feedback from brokers.