Record-breaking growth in broker market share has been driven by a renewed appreciation of the services offered by brokers in a complex credit environment, according to a Sydney-based broker.
Last week, research released by the Mortgage and Finance Association of Australia (MFAA) revealed that the overall share of home loans originated by the broker channel increased to a record high of 59.1 per cent in the September quarter of 2018, up 5.5 percentage points from 53.6 per cent in the previous quarter.
Speaking to The Adviser, managing director of BlueCherry Home Loans George Tsoukalas said the uptick in broker market share was “no surprise” in light of ongoing credit policy changes introduced by lenders off the back of the financial services royal commission.
“Lenders have changed their policies more often during the royal commission than ever before,” he said.
“This has resulted in clients being turned down for home loans with their current bank due to their financial position no longer being suitable to that bank’s credit criteria.”
Mr Tsoukalas said he believes borrowers are becoming increasingly appreciative of the services offered by brokers, who have helped facilitate access to finance from lenders that have reduced their risk appetite in response to regulatory reform.
“Customers can now see the benefit of dealing with brokers as they have access to more than one policy or one affordability calculation, and the flexibility of going to lenders outside the major banks that may be more understanding of their financial situation,” he added.
The Sydney-based broker also noted BlueCherry Home Loans has diversified its lender offering off the back of changes in the mortgage market, to ensure that clients have access to credit providers with lending policies suitable to their needs.
Mr Tsoukalas echoed the sentiments of several industry leaders, who highlighted the growing importance of the broker channel following the release of the market share data.
MFAA CEO Mike Felton, AFG CEO David Bailey, Loan Market executive chairman Sam White, Mortgage Choice CEO Susan Mitchell and Connective director Mark Haron welcomed the news amid continued scrutiny of the third-party channel.