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Concerns about mortgage brokers in a submission to the parliamentary inquiry

The Customer Owned Banking Association (COBA) has raised concerns about mortgage brokers in its submission to the parliamentary inquiry into home ownership. The Customer Owned Banking Association’s raised a number of issues including potential for consumers to misunderstand broker limitations in terms of lenders and products offered, the obligations of the broker when offering loans to the customer and a lack of disclosure regarding if the mortgage broker is vertical integrated with a bank.

According to the Mortgage and Finance Association of Australia (MFAA), aggregation/mortgage broker groups that are owned totally or substantially, by the big 4 banks,  comprise an estimate of 40% of all mortgage brokers. The COBA has opposed vertical integration of mortgage broker groups with banks, strongly and repeatedly in the past.

You are right to be concerned about mortgage brokers being owned by the banks and lenders (vertical integration). Many of which have access to only a limited number of lenders and loan products, which may result in customers being directed to their owner’s (Banks) home loan products. Consumers want to visit a mortgage broker so that you can select from a wide range of lenders and loan products. If consumers wanted to go to a Bank and and over pay, then they don’t need to go to a bank owned mortgage broker, just be be fed that bank’s products. Consumers expect that a mortgage broker is owned independently from the bank.

• Oak Laurel mortgage brokers are NOT owned by a big bank or other lender.

• Oak Laurel are mortgage brokers independently owned from the big banks.

• Oak Laurel are family owned mortgage brokers!

This post appeared first on Oak Laurel.