Australians don’t understand the value of a broker

Staff Reporter

Almost 25 per cent of Australians do not understand the value proposition of a mortgage broker, new research has found.

According to the latest Bankwest/Mortgage and Finance Association Home Finance (MFAA) Index, 97 per cent of Australians understand that a broker can help them with their home loan needs, however, one quarter of those don’t understand what additional services a broker can provide.

“This data creates an opportunity for our industry to change the perception of mortgage brokers, and better educate consumers about the benefits of using a broker,” MFAA chief executive officer Phil Naylor, said.

“It’s well known that brokers act as intermediaries, but accredited mortgage brokers are not actively promoting the range of value-based services they offer. Our industry needs to do a much better job in articulating the real value of what we offer consumers, how these services save them money and time as there is a big perception gap in the market that must be addressed.”

Bankwest Retail head of specialist sales Ian Rakhit said the research shows the overall proportion of people who understand the benefits of using a broker appear to be bouncing back from a trough in November 2009.

“What we’ve found is the top three benefits of using a broker are listed as doing all the legwork (77 per cent), having a wider loan range (75 per cent), and having experts in a range of mortgages from numerous lenders (73 per cent),” Mr Rakhit said.

Mr Naylor said the introduction of legislation would hopefully enhance how accredited brokers are perceived by consumers, government, and other key stakeholders.

“Professionalism and education are increasingly being recognised as a key differentiator so the industry must capitalise upon this momentum,” Mr Naylor said.