It is “unacceptable” that turnaround times in branches can be measured in hours yet brokers are “waiting weeks”, according to the managing director of a mortgage broking franchise.
The managing director of MoneyQuest has called out the ongoing “imbalance” in turnaround times between different channels, after nearly half of the franchise brokerage’s members outlined that service levels were the worst they have ever been.
The brokerage brand, which currently has just over 100 offices across Australia, recently undertook its annual Franchise Owner Sentiment Survey, which explored several areas of interest, including lender service levels and career satisfaction.
According to the survey, 50 per cent of participants said that lender service levels were the worst they have ever been, and 32 per cent rated them as ‘poor’. Brokers responding to the survey lamented that it could take up to four weeks for some files to be picked up.
Only 11 per cent of participants classed current lender service levels as ‘good’.
The findings echo the latest Broker Pulse survey from Momentum Intelligence, which found that the average lender turnaround figure was sitting around 10.3 days for broker loans in May 2021, down from 11.5 days in April. However, commentary from bank CEOs has previously suggested that proprietary channel loans were only taking a couple of days.
Indeed, similar to the Broker Pulse survey, MoneyQuest brokers stated that the four most “reliable” lenders they were currently using were Macquarie Bank, ING, Bankwest and ChoiceLend (Choice’s white label product funded by Advantedge Financial Services).
MoneyQuest’s managing director, Michael Russell, noted that while some lenders had made significant inroads in improving processing times for broker customers, he emphasised that there was still work to be done.
“Despite recent media coverage and industry panel discussions around this issue, there are still lenders out there that are not working hard enough to improve their service levels,” Mr Russell said.
“It is unacceptable, in the year 2021, that turnaround times in branches can be measured in hours yet brokers are waiting weeks.
“The channel imbalance needs to be rectified urgently, particularly for new-to-bank clients where we see the greatest disparity,” Mr Russell added.
Despite the frustrations with turnarounds, the MoneyQuest Franchise Owner Sentiment Survey found that brokers had very high levels of job satisfaction.
Ninety-six per cent of broker respondents described themselves as either ‘totally happy’ or ‘mostly happy’ with their decision to become a mortgage broker.
The survey also revealed that MoneyQuest franchise owners feel optimistic about the future of their businesses in the current climate, with 68 per cent of participants sharing that they are ‘very confident’ about their business prospects for the next 12 months, with the remaining third feeling ‘somewhat confident’.
No broker participating in the survey said that they were not very confident about their future prospects, which MoneyQuest suggested could be reflection of the strong property market and record-high levels of mortgage activity.
Noting the MoneyQuest survey findings, the CEO of the Mortgage & Finance Association of Australia (MFAA), Mike Felton, said: “The fact that the vast majority of brokers are content with their choice of profession despite the trying circumstances of recent months and years is not only a testament to the resilience of those working in our industry, but also reflects the key role mortgage brokers play in the economy and the communities they serve,” he said.
“Mortgage brokers play a critical role in providing access to credit, helping people to achieve one of life’s great goals in purchasing a property. This provides tremendous professional and personal satisfaction for brokers, which I believe contributes to this survey outcome,” the MFAA CEO added.
Mr Felton recognised the “significant frustrations” cited by brokers regarding turnaround time delays, emphasising that this impacted on the industry’s ability to compete.
He added that the association would continue “elevating the dialogue on this key turnaround issue until meaningful long-term improvement in turnaround differentials is achieved”, which he said would “hopefully further drive the level of contentment in future surveys”.
Annie Kane is the editor of The Adviser and Mortgage Business.
As well as writing about the Australian broking industry, the mortgage market, financial regulation, fintechs and the wider lending landscape – Annie is also the host of the Elite Broker and In Focus podcasts and The Adviser Live webcasts.
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