Paperwork burden driving borrowers to brokers: Survey

After surveying 606 Australians who had either recently taken out a mortgage or were intending to get a home loan or refinance in the next 12 months, the researchers found that the number one reason driving consumers to brokers was “help with all the paperwork”.

The second-most commonly cited reason for using a broker was the ability to find “competitive interest rates”, followed by the “access to a panel of lenders”, finding the “lowest interest rate” and generally having an “easy process”.

When asked what factors constituted an “easy process” in home loans, more than half the respondents (54 per cent) nominated “fast approval times” as one of the top considerations. 

The findings echo those made by Momentum Intelligence’s Consumer Access to Mortgages report for 2021, which surveyed 1,036 consumers between January and April 2021. 

This year’s survey found that the mortgage broking channel continues to be the preferred channel among existing borrowers and prospective borrowers. 

However, the survey found that client satisfaction with brokers had fallen 16 percentage points in the last year, largely as a result of slow turnaround times.

Brokers continued to be well rated for their communication with clients (85 per cent vs 69 per cent), which was particularly important during peak COVID-19 outbreaks, but the lower levels of satisfaction correlated highly with frustrations around speed of approvals for loans via the broker channel. 

Indeed, while borrower satisfaction with speed of approval was low across the board, (at just 57 per cent overall), these figures were better for proprietary customers (61 per cent) compared to broker customers (53 per cent).

The issue reflects publicly acknowledged turnaround time disparities between the two channels.

[Related: What borrowers want]