Media Release Updates on Broker Market Share
The MFAA's Media Release
It is quite the understatement to say that the landscape of the lending industry in Australia is shifting. The housing industry, as well as commercial properties, proved to be challenging in the past few years as consumers struggled with securing investment and owner-occupied home loans from banks and the larger lending institutions.
Against this bleak background, Mike Felton Chief Executive Officer for Mortgage & Finance Association of Australia (MFAA) shared the impressive news that, in spite of a decrease in lending across the board, mortgage brokers saw their share of the residential housing market surge to 59.1 per cent in September 2018.
This gain in market share is unprecedented, and it holds the spot for the second largest increase in mortgage brokers’ share of the residential market since the start of record keeping for this type of activity.
The significant jump is a positive increase that exceeds recent statistics from the same quarter previously.
- Mortgage brokers originated 55.7 per cent of all residential home loans during the September quarter in 2017
- For the same quarter in 2016, mortgage brokers had a market share of 53.6 per cent of residential mortgages originated
MFAA CEO Offers Praise For Brokers, Criticism For Banks
Felton also made the point that this increase is significant. The number of loans settled by brokers decreased during the period of September 2017 and September 2018 dropping 3 per cent from $51.77 billion to $50.19 billion.
Despite the drop, the MFAA CEO advises the information should stand within the context of the market as a whole. The fact that the entire market took a hit and dropped 8.5 per cent going from $98.79 billion in September 2017 to $90.33 billion one year later stands to highlight the huge success the 59.1 per cent jump represents.
Mr Felton continued his comments by giving praise to the mortgage broking industry as a whole. He noted the growth demonstrates consumers’ belief and certainty in their individual mortgage brokers and in the field of broking. Additionally, Felton pointed out that this major success happened during what he calls “a period of severe credit tightening” and that brokers came to the aid of consumers providing, “the redistribution of credit.”
When speaking of Australia’s Big Four banking institutions, National Australia Bank (NAB), Commonwealth Bank (CBA), Australia and New Zealand Banking Group (ANZ), Westpac (WBC) Felton pointed out that these institutions inadvertently assisted in the growth of mortgage brokers’ share in the residential market. He noted that by tightening the purse strings and making securing a loan increasingly more difficult, potential borrowers turned to brokers in increasing numbers. These actions on the part of borrowers led to the large gains mortgage brokers experienced.kers experienced.
What Are Some Reasons People in Search of a Loan go to Mortgage Brokers?
As stated, Australia’s banks and large lending institutions have recently changed several policies which increased the difficulty of securing a loan. Seeking mortgage funding from a broker is certainly not a brand-new idea. Mortgage brokers originated more than half of all new home loans in Australia in the March 2015 and March 2016 quarters. Clearly, many more Australians are opting to go that route in recent years after being turned away by the banks.
Other reasons consumers choose a mortgage broker over a bank for a home loan include:
- Often, mortgage brokers have much more experience working with the housing market than loan officers at a bank. Naturally, these brokers are experts in their field and have a wealth of experience-based knowledge to offer clients.
- Working with a mortgage broker makes the loan process faster than shopping for a loan on your own. On average, a mortgage broker can access about 34 lenders on behalf of a client. Not only does this streamline the process , but it also increases the chances of loan approval exponentially, and the terms of the loan will be as favourable as possible.
- A broker will understand special circumstances and will not try to push a client into a ‘one-size-fits-all’ type of loan. The helps eliminate the hoops borrowers must jump for a loan from a bank.
- Mortgage brokers do the hard work for their clients. Borrowers are generally happy to leave confusing applications and the like in the hands of a pro.
- Borrowers prefer the friendly and personalised service they receive from brokers. It is not uncommon for a broker to also be the owner or a partner in the firm where they work. Not only do these professionals want to help secure a loan, but they are also interested in forming a long-term business relationship with their clients.
How do I know What Mortgage Broker I Should Choose?
While there are several factors consumers should consider when choosing a mortgage broker these five attributes are part of the culture at Vie Financial and are of paramount importance.
- Brokers willing to work with your unique circumstance. Regardless what those in the industry may tell you, there is no such thing as a ‘one-size-fits-all’ mortgage. To one degree or another, every customer has circumstances worthy of consideration when securing a loan. Vie Financial has professionals who will take the time to listen to you and work to help you decide on the best options for your needs.
- A firm that stands on their own merits and does not pay other professionals for referrals. We, at Vie Financial, are not soda or toothpaste, so we do not seek endorsements. We do not offer nor accept any remuneration from those in related industries or our clients. If you someone refers you to us, it is because the person referring you believes in our skilled services.
- A mortgage broker with an exceptional reputation for honesty and integrity is the only sort of broker you want in charge of your mortgage. Vie Financial is proud of our excellent standing. If you are working with a broker you feel may be questionable, seek a second opinion.
- Your mortgage broker should have a large pool of potential lenders. Vie Financial has access to more than 40 different lenders. This allows us to look at various requirements and terms as opposed to the single set banks use.
- Working with professionals who sincerely care about you is paramount to the outcome of your application. The professionals at Vie Financial will be here to provide you with guidance through all of the stages of your life.
Getting a Good Home Loan is Achievable
For those consumers looking for a residential home mortgage, employing the services of a mortgage broker gives you flexibility, speed, and a smooth transaction. Do not let the stress of securing a loan rob you of the joy of purchasing a home; let professionals who care take care of you.
At Vie Financial, we care about you, your finance and your future. If service and support matter to you, speak to us today.
Introducing Gene Medwin of Vie Financial Devonport & Burnie
Franchise Principle of both Devonport & Burnie offices. Since opening in January 2016, Gene has quickly established himself as one of the country’s brightest young brokers, earning the reputation as a trusted adviser with both industry peers and clients alike.