‘Having used a broker yourself, would you say you trust brokers?’ was the final question we asked in our Consumers on Brokers survey.
In our Consumers on Brokers report for the second year running, we get real consumer opinions, good and bad, to the people who really need them – brokers. Our survey ran for five weeks on Key Media’s consumer-facing yourmortgage.com.au comparison website, and on the website of Your Investment Property magazine. These databases are closely monitored. Furthermore, we made sure all our respondents had actually used a broker – this survey is about real experiences, not just perceptions.
Our survey is, admittedly, not as big as those of the banks, but unlike the banks we don’t have a message or product to push. Instead, our questions have focused on current issues, namely ASIC’s remuneration review and the rate rises for new and existing customers introduced by banks in 2015. We’ve also included a number of practical questions to help brokers with their marketing and after-settlement service, and distinguished between different income and borrower groups where appropriate.
WHAT CONSUMERS SAID ABOUT YOU
Reader comments suggest the industry should be concerned about commissions, but also show that many brokers continue to do outstanding work
Whether you're discussing ASIC’s remuneration review, broker and bank communication of rate rises, or why personal recommendations are so important, all come down to a question of trust. Whilst we’ve tried to keep other questions statistical – which makes it easier to provide you meaningful insights that you can act upon – the issue of trust is too complicated to be encapsulated by a ‘yes/no’ answer.
Instead, we finished the survey with a straightforward question – ‘Having used a broker yourself, would you say you trust brokers?’ – and gave consumers as much text as they needed to answer it. Almost all the answers we received were interesting, extensive and relevant. We’ve included as many of the best as we can in this section.
What’s most evident from the comments is that trust has to be earned. Many commenters noted that they had not originally trusted brokers, often due to a perception that commission would sway their judgement. It was only after having a positive experience with a broker and seeing the benefits that they came to trust their broker. That doesn’t mean, however, that they trust brokers as a group. Many consumers sought personal recommendations for their broker for the same reason.
What can the industry do to build trust in brokers as a group? In the section title ‘interesting suggestions’, we’ve featured a few respondents’ selections. Many of these suggestions involve brokers having consistent, transparent structures. It’s therefore possible that ASIC’s review into remuneration could end up benefiting brokers hugely, by increasing public awareness of how the third party channel actually operates.
STAR COMMENT
Our final question to consumers was short and simple: ‘Having used a broker yourself, would you say you trust brokers?’ One respondent – who is now the recipient of a $250 gift card – eloquently summed up broking at its best:
“I trust my broker. He talks to me like we are mates, he puts everything into language I can understand and has done out-of-hours Skype calls to my wife and I, working around our schedule. He has contacted me almost daily, as often as I have needed and helped me tremendously with more than just the loan, but with me being able to bounce my strategy off him. The industry needs brokers like this who actually enjoy doing what they do and want to provide the best service for people.”
ROOM FOR IMPROVEMENT
• “I prefer to deal with the banks direct, so you know who you are dealing with. When you use a broker you are treated like a third party and the bank treats you differently.”
• “It depends. Our loan was with a non-standard lender and so more complex, and I felt our broker really didn’t put the time into understanding it. We had to do a lot of follow up with the bank. We refinanced ourselves, including ensuring we were getting the deal the broker said we would. All in all, I didn’t feel like the broker really cared about what happened.”
• “No. He took on too many clients, fobbed me off to his assistant, didn’t set up my finances as I requested and became an expensive, time-wasting third party interference between myself and the bank.”
• “I do trust brokers, however I do not feel they earn their trailing fees. After the deal has been done they are not interested and expect you to deal with the bank direct, then the bank doesn’t want to deal with you, so you go back to the broker and they have one of their juniors in the office complete the work.”
GOING ABOVE AND BEYOND
• “I trust my broker. As a first-timer entering the property market, I had no knowledge at all about how to set up the loan so that I could maximise my benefit. He explained the loan strategy and how to refinance my own home loan to get a few investment properties.”
• “I trust some brokers, but not all. My guy went the extra mile for me in a difficult situation, so I would be loathe to go to someone else. I am a person in small business, I work hard in my business and I want someone who works hard. But then I would reward them with loyalty.”
• “We have known our broker since we bought our first house and have always received quality service. I love that I can just call him up – he knows me and my financial history. He also knows my family, who use him as well. I feel confident when he puts forward offers and gives advice on which products to use. I have found his recommendations to be very competitive. I hope he sticks around because I wouldn’t want to switch to anyone else.”
• “My broker for my first home made the purchasing and finance organisation simple. The broker made it very clear that he is paid commission from the lending institute and that he cannot legally make a lending recommendation based on the commissions he receives. I do trust brokers and would consider using a well-regarded franchise that has a professional image to protect, ie Aussie or Mortgage Choice.”
PROBLEMS WITH COMMISSION
• “I would say I’m wary of brokers. Some are just in it for the commission and try their hardest to manipulate their clients into a situation that’s better for the broker, ie getting a home loan with their specific bank so as to get a bonus or more commission. Whereas I’m lucky I found the broker I had.”
• "Yes, I trust my broker. The information and advice he gives me is always open and backed up with figures/justification. I am fully aware of the commissions he receives from each bank. I do not have a problem with this. Better the commission comes from them than from me. The research he does into products available on the market saves me valuable time and money. I was unsure about whether to use a broker, but after having used one, I cannot see any reason why you would not.”"
• “Yes, I did trust my broker and that was purely from how I perceived him and his friendly and professional nature. It does play on your mind though, that they get paid a commission for their work and you may never be 100% sure they picked the best product for you when they have their own self-interest in it as well.”
• “No. First of all, my broker charged $400 as a consultancy fee for securing a mortgage for my investment property. From the outset it was very obvious that he preferred one or two lenders as a result of the amount of trailing commissions he was going to get. His communication was very poor and
to top it all off we had to do all the work and provide all relevant information for him. He provided zero value.”
INTERESTING SUGGESTIONS
• “I think they should receive the same commission/fee from all organisations/institutions and no ‘kick-backs’ as this would remove any trust issues in regard to the broker choosing one over another. I guess, like any industry, there are good and bad ones but ours is fabulous. And our wonderful broker is CFC George Kanellis at Parramatta NSW.”
• “Yes, I would say I trust a broker that has been recommended by other people’s experiences… My suggestion, in order to improve the level of transparency within brokers, is to have all lenders and products identified to their clients to include another column with the fee these lenders are offering brokers, therefore the client will have a better understanding when brokers choose certain products and lenders to be more open.”
• “Subject to an individual understanding that a brokerage(in this case mortgage broking) is a business, and provided the broker is forthcoming regarding the limitations of their services and their incentives, including how this relates to any advice they provide, I see no reason not to trust brokers. Some level of professional governance within the mortgage broking industry (if not already in existence) could assist with any reputational challenges in addition to guidelines for best practice service (which could include follow-up contact).”
• “I would definitely trust a broker. Particularly if they are referred to you. We live in a small area and if you do the wrong thing, you don’t get a recommendation, so it follows you can trust them to do the right thing.”
Related articles:
Consumer thoughts on broker commissions
Who's using a broker and how do they choose you?
What consumers want from after-settlement service
Our survey is, admittedly, not as big as those of the banks, but unlike the banks we don’t have a message or product to push. Instead, our questions have focused on current issues, namely ASIC’s remuneration review and the rate rises for new and existing customers introduced by banks in 2015. We’ve also included a number of practical questions to help brokers with their marketing and after-settlement service, and distinguished between different income and borrower groups where appropriate.
WHAT CONSUMERS SAID ABOUT YOU
Reader comments suggest the industry should be concerned about commissions, but also show that many brokers continue to do outstanding work
Whether you're discussing ASIC’s remuneration review, broker and bank communication of rate rises, or why personal recommendations are so important, all come down to a question of trust. Whilst we’ve tried to keep other questions statistical – which makes it easier to provide you meaningful insights that you can act upon – the issue of trust is too complicated to be encapsulated by a ‘yes/no’ answer.
Instead, we finished the survey with a straightforward question – ‘Having used a broker yourself, would you say you trust brokers?’ – and gave consumers as much text as they needed to answer it. Almost all the answers we received were interesting, extensive and relevant. We’ve included as many of the best as we can in this section.
What’s most evident from the comments is that trust has to be earned. Many commenters noted that they had not originally trusted brokers, often due to a perception that commission would sway their judgement. It was only after having a positive experience with a broker and seeing the benefits that they came to trust their broker. That doesn’t mean, however, that they trust brokers as a group. Many consumers sought personal recommendations for their broker for the same reason.
What can the industry do to build trust in brokers as a group? In the section title ‘interesting suggestions’, we’ve featured a few respondents’ selections. Many of these suggestions involve brokers having consistent, transparent structures. It’s therefore possible that ASIC’s review into remuneration could end up benefiting brokers hugely, by increasing public awareness of how the third party channel actually operates.
STAR COMMENT
Our final question to consumers was short and simple: ‘Having used a broker yourself, would you say you trust brokers?’ One respondent – who is now the recipient of a $250 gift card – eloquently summed up broking at its best:
“I trust my broker. He talks to me like we are mates, he puts everything into language I can understand and has done out-of-hours Skype calls to my wife and I, working around our schedule. He has contacted me almost daily, as often as I have needed and helped me tremendously with more than just the loan, but with me being able to bounce my strategy off him. The industry needs brokers like this who actually enjoy doing what they do and want to provide the best service for people.”
ROOM FOR IMPROVEMENT
• “I prefer to deal with the banks direct, so you know who you are dealing with. When you use a broker you are treated like a third party and the bank treats you differently.”
• “It depends. Our loan was with a non-standard lender and so more complex, and I felt our broker really didn’t put the time into understanding it. We had to do a lot of follow up with the bank. We refinanced ourselves, including ensuring we were getting the deal the broker said we would. All in all, I didn’t feel like the broker really cared about what happened.”
• “No. He took on too many clients, fobbed me off to his assistant, didn’t set up my finances as I requested and became an expensive, time-wasting third party interference between myself and the bank.”
• “I do trust brokers, however I do not feel they earn their trailing fees. After the deal has been done they are not interested and expect you to deal with the bank direct, then the bank doesn’t want to deal with you, so you go back to the broker and they have one of their juniors in the office complete the work.”
GOING ABOVE AND BEYOND
• “I trust my broker. As a first-timer entering the property market, I had no knowledge at all about how to set up the loan so that I could maximise my benefit. He explained the loan strategy and how to refinance my own home loan to get a few investment properties.”
• “I trust some brokers, but not all. My guy went the extra mile for me in a difficult situation, so I would be loathe to go to someone else. I am a person in small business, I work hard in my business and I want someone who works hard. But then I would reward them with loyalty.”
• “We have known our broker since we bought our first house and have always received quality service. I love that I can just call him up – he knows me and my financial history. He also knows my family, who use him as well. I feel confident when he puts forward offers and gives advice on which products to use. I have found his recommendations to be very competitive. I hope he sticks around because I wouldn’t want to switch to anyone else.”
• “My broker for my first home made the purchasing and finance organisation simple. The broker made it very clear that he is paid commission from the lending institute and that he cannot legally make a lending recommendation based on the commissions he receives. I do trust brokers and would consider using a well-regarded franchise that has a professional image to protect, ie Aussie or Mortgage Choice.”
PROBLEMS WITH COMMISSION
• “I would say I’m wary of brokers. Some are just in it for the commission and try their hardest to manipulate their clients into a situation that’s better for the broker, ie getting a home loan with their specific bank so as to get a bonus or more commission. Whereas I’m lucky I found the broker I had.”
• "Yes, I trust my broker. The information and advice he gives me is always open and backed up with figures/justification. I am fully aware of the commissions he receives from each bank. I do not have a problem with this. Better the commission comes from them than from me. The research he does into products available on the market saves me valuable time and money. I was unsure about whether to use a broker, but after having used one, I cannot see any reason why you would not.”"
• “Yes, I did trust my broker and that was purely from how I perceived him and his friendly and professional nature. It does play on your mind though, that they get paid a commission for their work and you may never be 100% sure they picked the best product for you when they have their own self-interest in it as well.”
• “No. First of all, my broker charged $400 as a consultancy fee for securing a mortgage for my investment property. From the outset it was very obvious that he preferred one or two lenders as a result of the amount of trailing commissions he was going to get. His communication was very poor and
to top it all off we had to do all the work and provide all relevant information for him. He provided zero value.”
INTERESTING SUGGESTIONS
• “I think they should receive the same commission/fee from all organisations/institutions and no ‘kick-backs’ as this would remove any trust issues in regard to the broker choosing one over another. I guess, like any industry, there are good and bad ones but ours is fabulous. And our wonderful broker is CFC George Kanellis at Parramatta NSW.”
• “Yes, I would say I trust a broker that has been recommended by other people’s experiences… My suggestion, in order to improve the level of transparency within brokers, is to have all lenders and products identified to their clients to include another column with the fee these lenders are offering brokers, therefore the client will have a better understanding when brokers choose certain products and lenders to be more open.”
• “Subject to an individual understanding that a brokerage(in this case mortgage broking) is a business, and provided the broker is forthcoming regarding the limitations of their services and their incentives, including how this relates to any advice they provide, I see no reason not to trust brokers. Some level of professional governance within the mortgage broking industry (if not already in existence) could assist with any reputational challenges in addition to guidelines for best practice service (which could include follow-up contact).”
• “I would definitely trust a broker. Particularly if they are referred to you. We live in a small area and if you do the wrong thing, you don’t get a recommendation, so it follows you can trust them to do the right thing.”
Related articles:
Consumer thoughts on broker commissions
Who's using a broker and how do they choose you?
What consumers want from after-settlement service
A MESSAGE FROM OUR SPONSOR
Information is powerful. Understanding your customer’s needs, financial goals and what led them to you in
the first place will play a defining role in shaping your service proposition. At Suncorp Bank, we recognise the importance of putting the customer at the heart of every decision.
We know customers are increasingly engaging with brokers for their home and investment lending needs. The value lies in knowing why. With this in mind, Suncorp Bank is proud to partner with MPA to bring you the Consumers on Brokers survey, proving valuable insights into consumer behaviour.
Brokers are looking for more than a mortgage broker °– they are looking for a trusted partner. At Suncorp Bank, we see our service as an extension of yours.
Our proposition is built around supporting the broker-customer relationship. Exceptional service is central to this, with our national team of Business Development Managers and local call centre sta˛ ed with lending experts providing on-the-ground, dedicated support.
Suncorp Bank aims to support brokers to do this by providing access to decision makers and other crucial information through the loan process. Transparency is a key part of this, allowing brokers to set and manage expectations with their customers.
Feedback is one of the most powerful tools available to our industry. We hope that the Consumers on Brokers survey provides valuable insights, information and intelligence to support you to enhance your customer service proposition, as we seek to continue to elevate our own for brokers.
Steven Degetto
Head of intermediaries
Suncorp Bank
Information is powerful. Understanding your customer’s needs, financial goals and what led them to you in
the first place will play a defining role in shaping your service proposition. At Suncorp Bank, we recognise the importance of putting the customer at the heart of every decision.
We know customers are increasingly engaging with brokers for their home and investment lending needs. The value lies in knowing why. With this in mind, Suncorp Bank is proud to partner with MPA to bring you the Consumers on Brokers survey, proving valuable insights into consumer behaviour.
Brokers are looking for more than a mortgage broker °– they are looking for a trusted partner. At Suncorp Bank, we see our service as an extension of yours.
Our proposition is built around supporting the broker-customer relationship. Exceptional service is central to this, with our national team of Business Development Managers and local call centre sta˛ ed with lending experts providing on-the-ground, dedicated support.
Suncorp Bank aims to support brokers to do this by providing access to decision makers and other crucial information through the loan process. Transparency is a key part of this, allowing brokers to set and manage expectations with their customers.
Feedback is one of the most powerful tools available to our industry. We hope that the Consumers on Brokers survey provides valuable insights, information and intelligence to support you to enhance your customer service proposition, as we seek to continue to elevate our own for brokers.
Steven Degetto
Head of intermediaries
Suncorp Bank
