Brokers call for credit assessor consistency

The findings come in the Broker Pulse survey from Momentum Intelligence, which each month asks brokers to rate their experience of using lenders. As part of the barometer of lender satisfaction, brokers are asked to rate the consistency of credit assessors.

According to the research, undertaken in partnership with The Adviser, the proportion of brokers citing that credit assessors are applying lender policies ‘consistently’ has dropped every month for the past six months. This comes in tandem with record levels of mortgage applications and refinances.

While assessors were typically scoring consistency rates over 70 per cent in late 2019 and the first half of 2020, this has been steadily falling since June 2020.

Indeed, the Broker Pulse survey shows that 78 per cent of broker respondents believed assessors were consistent in June 2020, dropping to 75 per cent in July and August 2020, to 62 per cent in September before closing out the year at a new low of 56 per cent.

The most recent Broker Pulse survey (January 2021) – which received 194 broker responses between 1-9 February – found that this number had only improved marginally, to 58 per cent over the course of last month.

Similarly, the proportion of brokers citing ‘inconsistent’ application of policy were at the highest levels since the survey’s inception (September 2019). The inconsistency levels were at 29 per cent in December 2020 and 25 per cent in January 2021. 

The major banks fared particularly badly from broker responses, with 37 per cent of interactions classed as “inconsistent”.

Broker respondents urged their Broker Pulse counterparts to choose lenders carefully, based on the levels of consistency.

One broker told Momentum Intelligence: “The amount of shuffling between different levels of credit divisions is the cause of these delays, not volume or training new staff as they would believe. Each division has a new delay, which just keeps pushing out the times.”

BDMs have also recorded lower-than-usual satisfaction ratings from brokers – particularly major bank BDMs, who had a 62 per cent satisfaction rating compared with 86 per cent for non-banks and 79 per cent for non-major banks.

Typically, BDMs have been able to step in to help with broker requests but, based on broker comments, the level of service has suffered as turnaround times have blown out and application volumes increase.

One respondent offered the following advice to the Broker Pulse community: “Ensure you have a good BDM to assist with inefficiencies in the assessment process, and talk to Credit Scenario Teams pre-lodging, wherever possible, if anything is slightly abnormal with proposed application.”

Another said: “Make sure that if you have a BDM, do a scenario that they get clearance from credit. Have had lots of yes applications that turn to no when it gets to actual credit assessment. Very frustrating for me and my clients.”

Momentum Intelligence’s head of strategy, Michael Johnson, told The Adviser that credit assessors have been under significant pressure to apply their lender’s policies consistently, particularly while working with brokers who are already frustrated with long turnaround times.

He said: “We know that turnaround times have been frustrating the broker channel, and similarly for credit assessors, who are working harder than ever.

“Any hiccup or misinterpretations on either side of the equation – whether credit assessor or broker – can cause the turnarounds to blow out further and only add to those frustrations.

“But it’s important to keep in mind that everyone is working in a high-stress, high-volume environment at the moment.”

Turnaround times and credit policy consistency has been a major bugbear for the broker channel, with a recent update from the Mortgage & Finance Association of Australia (MFAA) outlining that there is a growing disparity in credit decisioning times between proprietary and third-party channels.

The CEO of the MFAA, Mike Felton, commented earlier this year: “It does seem evident that, at a time when resources are tight and volumes flowing, it does appear that broker channel SLAs blow out and yet branch seems to remain fairly stable.” 

However, the MFAA CEO added that there had been a “strong acknowledgement of the problem” from several lenders, and that all four major banks had expressed “a genuine and absolute concern” about the issue “and are working hard to resolve [it]”.

Indeed, the CEO of the Commonwealth Bank of Australia, Matt Comyn, told The Adviser this week that the major bank has a “disciplined focus on turnaround times”, but added that it’s “easier” to improve speed via the proprietary channel than the broker channel.

He continued: “It is important, from our perspective, to make it easy for our brokers to do business with us and to make sure that we’re providing a competitive and leading decisioning process and turnaround time. And I know that that’s a focus from Angus [Sullivan], who runs the retail bank, and our third-party team.”

Brokers interested in joining Momentum Intelligence’s Broker Pulse panel can apply to Momentum Intelligence here. Participants of the survey will receive full access to the report and exclusive insights into the research. 

[Related: Brokers report longer turnarounds at the big banks]