Mortgage broker advisory role welcomed by LJ Hooker

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LJ Hooker’s financial division supports industry organization, MFAA’s move toward encouraging its members to become fully qualified professional credit advisers.

MFAA’s proposed framework of tiered professional qualifications will see brokers qualify for a Certificate IV in Financial Services.

LJ Hooker Financial Services General Manager Peter Bromley says this level of qualification is already built into the division’s performance standards for its brokers.

“All our current brokers meet Certificate IV standards, which means they complete 30 hours of CPD a year, have a conversion ratio of 65 per cent, accreditation with a panel of at least 10 lenders and settle at least six loans per quarter.

“We are fully behind the MFAA’s proposal. It is in keeping with what the industry wishes to offer customers in terms of broker education and professionalism.”

Mr Bromley said the public should be able to feel confident in advice offered by brokers they deal with.

“We can expect the RBA’s March .25 base point increase and subsequent action by major lenders will have new and existing borrowers wanting the best available advice about loan options in any current market.

“Giving consumers the confidence that brokers can professionally advise because of their degree of education, experience and qualification is a welcome step forward,” he said.

LJ Hooker Financial Services’ target is to have recognised credit advisers available to customers through all 550-plus Australian LJ Hooker real estate offices.

“This means a minimum of over 500 professional loan writers across Australia,” said Mr Bromley.

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2 COMMENTS

  1. I’ve said this before but 24 loans per year is not big business but assuming that a specific brokers average loan total is just above $400K, this would mean a $10Mil / year broker. Not big, but not to be sneezed at (I’d employ someone if they settled $10Mil / year). Put 3 such brokers together and after a few years you are talking about a $100Mil total loan book.

    I think the MFAA needs to go back to the drawing board on volume. It seems insane to me for them to be kicking out brokers settling $10Mil / year.

    Look at aggregator annual settlement numbers and total number of brokers. When I’ve done this quick check it tells me the AVERAGE broker settlement volume is generally between $6Mil-$12Mil / y. Which tells me the MFAA is looking to expel the average mortgage broker. Who the hell is driving this agenda?

  2. Im up for renewal of MFAA and I suggested to them “give me one good reason to renew” Their reply has been “tell us three things you expect us to do for you”. My concern is that after – commission cuts, cert 4 requirements, up coming regulation ( which is basically only regulating the legitimate broker ) and now professional credit adviser requirements, we have been given nothing in return. I stipulated the following –

    1./ As we are signing broker agreements/contracts with clients and as we receive trail its not a once off transaction. Banks should not have direct contact with our clients. If they write further loan business we get the commission. If the client specifically wants to “break” our agreement it should be in writing, signed by the client to us.

    2./ SLA’s to be given to the broker channel. If the Bank chooses to “break” these agreements, then the MFAA suspends them from the MFAA broker channel.

    3./ Further commission cuts should be passed onto broker originated clients. The end result being broker rates are cheaper than branch rates. As is now happening in the financial planning industry – the banks now own the product ( which is where they are making additional income ). They are pushing to have commissions abolished. Why would a client go to a financial planner and get charged?

    4./ Trailing commissions owned by the broker and paid if we switch Aggregators or they go broke.

    I am expecting the MFAA to say these are Aggregator issues, the problem now is a Bank owns the largest Aggregator. The MFAA is supposed to be our voice.

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