Brokers believe they may one day write 75 per cent of all home loans following massive third-party growth in the past year.
The MFAA has revealed that brokers wrote $34.1 billion dollars of loans in the March quarter – a 41.5 per cent increase on 12 months earlier.
The third-party channel also wrote 49.9 per cent of Australia’s home loans in that quarter, which the MFAA said represented a doubling of market share in the past decade.
Part of the reason brokers are becoming more popular is that more people are learning what they offer, according to David Chehade, managing director of Real Estate Investment Finance.
“I truly believe that we’ll keep increasing [our market share] and it may go to 75 per cent in the next 10 years,” he told The Adviser.
Loan Market Chermside principal Leo Bozzi also said brokers might one day attain 75 per cent market share, partly because borrowers valued the transparency they offered.
“We do a loan and we’re totally transparent about what fees the customers are up for and what we’ll be paid by the bank,” he said.
South West Sydney Mortgage Finance director Mitchell Lillis said clients also valued brokers for their out-of-hours service.
He told The Adviser that clients were grateful when he visited them on weeknights and weekends.
Brokers also prove their worth by helping clients who have been rejected by banks, according to Colin Kidd, whose firm, Loan Saver Network, specialises in non-conforming loans.
He said that was why non-conforming clients often had a higher opinion of brokers than regular borrowers.
MFAA chief executive Phil Naylor said the third-party channel would continue to increase its market share in 2014.
“The figures clearly show that the mortgage brokers have got their message through to borrowers: that they are the best vehicle [through which] to find a loan most appropriate to their needs and aspirations,” he said.
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