Ep.41 The Royal Commission and Impacts on Your Home Loan

This week, we take an impromptu look at the fallout from the Banking Royal Commission and what it may mean for your home loan and lending going forward. As mentioned, Marcus is a mortgage broker, so he is explaining his opinion based on his understanding and experience in the industry.

Royal Commission and the Impacts on Your Home Loan


HERE’S WHAT YOU’LL LEARN FROM TODAY’S EPISODE:

  • Some of the examples of misconduct in the sector by big banks;

  • Recommendations to certain sectors of the industry;

  • Paying your broker for advice and adding to the bank’s bottom line;

  • The finding that 96.5% of consumers wouldn’t pay even a break-even fee for a mortgage broker;

  • Will consumers pay for pre-approval after pre-approval;

  • The question as to whether or not banks are mandated to reduce their fees;

  • How brokers have helped banks’ net interest margin reduce from 5% to 2.2% over the past 20 years;

  • Why smaller non-big 4 banks may exit the industry and thereby reduce competition;

  • This trail commission being $33.75 a month on a $300k loan, a far deviation from the number of $500k to the odd broker who has a staff of 30;

  • Why your rates may go up as competition exits in future;

  • Unintended consequences that need to be worked out; And

  • Other commentators views on the proposed changes.

SOURCES NOTED

ASIC Remuneration Review

RBA Net Interest Margin History

Your Broker Behind You

Peter Switzer Commentary

Shane Oliver Statement

Mortgage Broker Stats

SPEAKERS IN TODAY’S EPISODE

Michelle May - Buyer's Agent

Marcus Roberts - Mortgage Broker

ASK US ANYTHING!

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Please note that any views or opinions presented in this podcast are solely those of the speakers, and do not necessarily represent those of any business. These views and opinions are general in nature, and do not take account of your personal objectives, financial situation and needs. Please consider whether it applies in your circumstances and seek professional advice wherever appropriate.