Association pushes for fairer mortgage regulation changes
The Finance and Mortgage Advisers Association of New Zealand (FAMNZ) recently described its meeting with the new minister of commerce and consumer affairs, Scott Simpson, as “very constructive.”
The discussions centered around the Commerce Commission’s recommendations, which have sparked significant concern within the industry.
FAMNZ’s Leigh Hodgetts (pictured) highlighted the minister’s receptive attitude, noting his understanding of the potential chaos that requiring mortgage advisers to provide three actual offers per application could cause for consumers, advisers, and lenders.
Hodgetts has been vocal about her concerns with the Commerce Commission’s new requirements, arguing that such regulations could raise costs, prolong processing, and harm consumer credit scores, and she has labelled these regulations as “unnecessary overregulation.”
FAMNZ campaign efforts and industry concerns
Despite the positive talks, Hodgetts said that the struggle to safeguard the industry’s interests is far from over.
She expressed continued concerns about the nature of some regulatory recommendations, suggesting a disconnect within government bodies regarding the crucial role of mortgage advisers in promoting competition.
“The bigger question is why we are seeing such detrimental recommendations at all,” Hodgetts said.
“Sadly, there is a perception that ComCom and others across government don’t understand the important role mortgage advisers already play in driving competition, and maybe even don’t try to understand. We’d like to believe this is not the case, which is why we are continuing to work with the commission and assist them.”
Challenges ahead for mortgage advisers
Hodgetts issued a stark warning to mortgage advisers across New Zealand about the serious risks facing their industry.
According to her, the proposed changes could drastically increase costs for consumers due to the need for handling multiple applications and conducting several credit checks. This could also burden lenders with the need for additional valuations and staff.
Hodgetts projected that application times could extend beyond 30 days, pushing consumers towards banks for quicker approvals.
Call to action for industry support
Hodgetts stressed the importance of collective action.
“Get on board before it’s too late and let’s stand together on this,” she said, signaling that FAMNZ is already proposing solutions to the commission.
She highlighted the practical approach of presenting comparisons from three lenders “where possible,” which should detail rates, approval amounts, repayments, cashbacks, and other pertinent details.
Hodgetts vowed to persist in her efforts and encouraged mortgage advisers seeking more information or wishing to get involved to contact FAMNZ.
