"We need to get the message out … let's not wait for the powers that be to make recommendations"
The amount of negativity the royal commission has brought upon the reputation of brokers, particularly around their remuneration, has driven Launch Finance Mandurah director Steve Milligan to release his own whitepaper on the value finance brokers provide their customers.
The Value of Finance Brokers and Positive Consumer Outcomes whitepaper explains the reviews that have come out about brokers, what the Combined Industry Forum is doing and how brokers provide competition and excellent service to customers. He presented the paper to his local Federal MP Andrew Hastie.
He said some media reporting on broker commission structures has been incorrect and that’s one of the reasons why he wanted to clarify how it works.
“They made statements about mortgage brokers [encouraging customers] to take [larger] loans from one lender because of trail commission,” Milligan told MPA. “That’s opposite from the truth. We get paid through upfront commission, and [receive] trail commission when we align our deal to the lender.”
Beyond monetary value
Another reason Milligan came up with the whitepaper was to point out that “it’s not all about what brokers get paid for, but what they don’t get paid for”.
He contends almost all brokers have a story about how they were able to help their customers in unexpected ways. Milligan shared that he once did a loan for a frustrated father and son who almost lost their house. The father, he found out later, had been in such deep despair that he was on the brink of making some terrible decisions.
There was also a time when he helped a couple get out of a small debt by refinancing their loan with a lower interest rate. The couple had never taken their kids on holiday, but because of the amount of money Milligan was able to save them, they were able to make that dream come true.
“These aren’t the things being reported in the media. Things we don’t get paid for; things you can’t quantify,” Milligan said. “We can actually be quite significant in people’s lives by the positive impact we deliver.”
Giving brokers a voice
Now that the whitepaper, co-produced with Launch Finance operations manager Kirsty Dellow-Pawski, is out, Milligan hopes more brokers will join the conversation and have their voices heard.
He understands that a lot of brokers are busy and probably lack the skillset to sit down and write a whitepaper. What he and Dellow-Pawski crafted aims to provide brokers with a common message that they can speak to customers and government leaders about. He has also announced that he’s happy to share his whitepaper for other brokers to use.
“If we really care about the industry and its longevity, we need to get the message out very strongly and very clearly. Let’s not wait for the powers that be to make recommendations,” Milligan said.
For him, the aim of the whitepaper is to create a positive impact by demonstrating to and educating politicians and consumers about the benefits and value brokers provide.
