The Turnbull Government has welcomed the mortgage industry’s creation of a forum to develop an industry led response to the Australian Securities and Investments Commission’s (ASIC’s) review of mortgage broker remuneration.
“I welcome the proactive steps taken by the mortgage industry forum to engage with the Government and consumer stakeholders on the issue of mortgage broker remuneration,” Minister for Revenue and Financial Services Kelly O’Dwyer said.
“The government requested the ASIC Review in November 2015 in response to the government initiated root and branch Murray Financial System Inquiry, signalling our continued commitment to fostering good consumer outcomes by financial service providers.”
The ASIC Review outlines a number of proposals for industry including:
- Improving the standard commission model for mortgage brokers;
- Moving away from bonus commissions and soft dollar benefits;
- Increasing disclosure of mortgage broker ownership structures; and
- Improving the oversight of mortgage brokers by lenders and aggregators.
Industry has provided feedback to treasury as part of a three month consultation process, which closed at the end of June. Treasury received over 30 submissions from brokers, banks and consumer stakeholders.
“The government recognises that mortgage brokers play an important role with more than half of all home loans originated by brokers and 26% of these loans written to non-major lenders, as compared to only 12% of loans written outside the broker channel,” Minister O’Dwyer said.
The government will take the mortgage industry forum’s process into account when finalising its response to the review.
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