A leading non-bank lender hosted an event in Sydney yesterday afternoon to clarify its position on the royal commission recommendations, as well as to speak to what’s ahead for the company.
Resimac GM of third party distribution, Daniel Carde, highlighted the benefit of being a non-bank lender with the ability to react to industry changes more nimbly than a larger, more traditional institution. He reminded the attendees of Resimac’s 30 years of history, including having successfully navigated the global financial crisis, and spoke of the future with confidence.
Carde told the industry leaders in attendance that the mortgage provider strongly supports the current lender-pays remuneration model, and is only open to future post-election changes that would lead to better consumer outcomes.
“Anything that diminishes competition or reduces consumer access to a wide range of mortgage options would be detrimental to ordinary Australians,” said Carde.
The Resimac leader went on to point out the obvious: consumers don’t like suddenly being expected to pay for something they didn’t have to previously. He reiterated that a borrower-pays model would undoubtedly cause a great deal of damage to the industry.
However, Carde did communicate that Resimac agrees with the underlying theme of the reform, to achieve better consumer outcomes and improved standards of conduct.
“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,” he said.
According to Carde, some of the recommendations – like the proposed best interest duty – will leave respectable brokers free to continue operating as they were, but will weed the few “bad apples” from the industry as a whole.
Resimac has hosted similar events in Perth, Adelaide and Brisbane, and has another scheduled in Melbourne on 26 March.
The lender was one of the earliest supporters of the nationwide ‘Don’t Kill Competition’ campaign launched by the Mortgage & Finance Association of Australia (MFAA) to oppose the proposed ban on all mortgage broker commissions paid by lenders to brokers.
Carde concluded, “Brokers provide consumers with access to loans from the big banks as well as smaller lenders without a branch network and accordingly stimulate competition within the lending market. The health of the broking sector is vital to achieving the best outcomes for home loan borrowers.”