Aggregators take note about how Wayne has rattled the CBA’s cage. He’s taken the CBA to task about volume for accreditation to the ACCC (who told him exactly what they told me - all is OK) however the mainstream media have picked up on this issue.

I’ve just heard the issue (CBA / Accreditation / Volume) being discussed on ABC radio (not the widest of audiences I’ll concede) however, the more scrutiny focussed on the business practices of these lenders the better.

The angle Wayne presents is what we’ve all been saying in that accreditation for volume is simply a way to drive business into the CBA’s door & is counterproductive to a properly researched and compliant industry sector. The consumer will be the loser if the CBA juggernaut is left unchecked.

Anyway, here is an example of a broker group or aggregation group (Refund Home Loans) who have actually spoken up about what’s been going on.

So Aggregators, where are the rest of you and why haven’t you hollered from the rooftops as Wayne has?

Mmmmhhh??

Volume has no bearing on submission quality, it is more likely that someone submitting fewer deals has more time to prepare and submit those applications. NOTE TO THE LENDERS: Pull your heads out of the clouds and put them together, then you might come up with a sound idea.

Think about this way, if every small broker went direct to the bank and did away with their aggregator. The ‘lender’ would pick up the aggregator split. Now let’s say the small broker only earns $50k after an 80/20 split. That is now an additional $12,500 p.a. that the lender will receive for processing commission splits on 3 deals a month. I am sure that they can employ one person and if that person only processes 2 payments per hour, then the lender will generate $1,390,277.70 and payout a wage of $60k… It is economically viable for the lender to deal direct and do away with the aggregators. Then they will diminish the potential level of opposition for future changes/penalties against the broker.

Under new proposed legislation, the MFAA and FBAA accreditation will be obsolete. As ASIC will govern and enforce broker qualifications and conduct. I expect these organisations to lose over 60% of membership revenue. What real benefit can they justify to us to stay with them. By their current inabilities to combat lender reaccreditation changes, I think none.

To the older brokers… Your succession planning just died before your eyes! The concept of sitting back, servicing your trail book and touring the country no longer go hand in hand. If you are not active daily then your accreditations will fall off and you will need to either join a group or pay for reaccreditation every time a client wishes to make an up stamp (probably more than the commission you will make on the up stamp). In turn your trail book sale just lost majority of its calculated value. The stock market was not the only thing to crash recently!

Why do people kid themselves and think that their aggregator will enforce their original promise and show real support. If you lose your lender accreditation, you then have to place that business elsewhere and the aggregator has not lost anything and will still receives a split on that business regardless of where you place it. Whilst we lose an accreditation there is a larger brokerage firm making far more profit from that lender for our aggregator? So why would an aggregator, really go in and bat for us and bite the bigger hand that feeds them!

This approach is already used overseas and again I only threw it in the ring as an out of right field idea for aggregators to consider.

The guts of this talkfeast as I understand is the future of aggregators and brokers and my idea of a tendering system changes the bank power dynamics