'No need for another broker review'

‘No need for another broker review’

The founder and CEO of National Finance Brokers Day says calls by consumer groups for an ASIC review of mortgage broker remuneration and the quality of brokers’ credit advice are “disconnected from reality”.

Dino Pacella (pictured above left), a well-known figure in the mortgage and finance industry, has voiced his strong opposition to the calls for a review.

The review is one of 11 recommendations made in a submission to the Senate from consumer rights and legal organisations, including CHOICE, the Consumer Policy Research Centre (CRPRC), Mortgage Stress Victoria, Financial Counselling Australia and seven other groups.

Their submission, prepared by the CRPC and Mortgage Stress Victoria, has been provided to the Senate economic references committee inquiry into the financial regulatory framework and homeownership, which has been holding public hearings in recent weeks.

Much of the debate at the inquiry has focused on APRA’s 3% home loan serviceability buffer, with industry bodies such as the MFAAFBAA and Australian Banking Association, aggregator Mortgage Choice and NAB calling for changes to the buffer, while CommBank and Westpac prefer the status quo

The consumer groups’ joint submission to the Senate is mostly about responsible lending laws, which they say are working as intended.

However, recommendation nine seeks confirmation on whether mortgage broker market protections are working.

ASIC should be directed to undertake new research into mortgage broker remuneration and the quality of recommendations by brokers,” the submission reads.

In response, Pacella has emphasised the critical role mortgage brokers play in helping Australians achieve homeownership and the fact that brokers already operate within an extensive regulatory framework.

As the CEO of National Finance Brokers Day, I’ve seen firsthand how mortgage brokers provide invaluable support to consumers by delivering personalised advice that helps them navigate complex financial decisions,” said Pacella.

“The Best Interests Duty ensures that brokers are obligated to prioritise their clients’ needs, and multiple past reviews have confirmed that the current remuneration structure is fair to both brokers and consumers.”

Pacella said the mortgage broking industry, represented by both the MFAA and the FBAA had stood firm against the need for further reviews.

Full Article: https://www.mpamag.com/au/news/general/no-need-for-another-broker-review/511426

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