The law favours the borrower and the lender when loans go bad, which often leaves the broker being unfairly blamed, says one aggregator group.
Tanya Sale, chief executive of Outsource Financial, has called for better protection for brokers when it comes to resolving issues surrounding loan applications.
Ms Sale believes that due to the level of protection afforded customers and lenders, it’s often the broker who is blamed for unsuccessful applications even though it may not be their fault.
“Everyone else is protected. Who protects the broker?” she said.
“Who’s going to go into bat for the broker? They’re left hung out to dry time and time again.”
Ms Sale said that industry regulation for situations such as external dispute resolutions has been fantastic, but a lot of it has focused on the consumer.
“There’s got to be some give-and-take for the broker,” she said.
“The consumer needs to be protected from the ‘he says, she says’ type of situation, but so does the broker.”
Ms Sale said a government initiative such as a state or federal ombudsman would be ideal, but regulators also need to give the industry associations more power in order to better protect brokers.
“Some people might say that it’s up to the MFAA or FBAA, but what are they going to do? What authority do they have?” she asked.