Following on from a new report, Looking for a mortgage: Consumer experiences and expectations in getting a home loan, ASIC has established several key findings about the mortgage broking industry.
In short, these are:
Noting that consumers surveyed found taking out a home loan was a “complex” and “overwhelming” experience, ASIC commissioner Sean Hughes said: “Lenders, brokers and aggregators must step up to make it easier for consumers to meaningfully compare loan options and for brokers to communicate how a home loan option has been selected for them.”
To assist in this process, Hughes said ASIC would be developing a “new home loan interest rate tool to improve price transparency for consumers to compare options.”
“We expect this tool will be made available on ASIC’s MoneySmart website next year,” he added.
Crucially, though, Hughes also said the regulator “strongly supports” extending the best interests duty to mortgage brokers. “Importantly,” he said, “the implementation of such a duty will align the role of brokers to the reasonable expectations of consumers.”
ASIC’s comments follow the release of another report, Financial advice: What consumers really think (REP 627). This report, based on a survey of 2,545 participants, found that 35% of respondents said the main barrier to getting financial advice was that it was "too expensive". A further 29% said their financial circumstances were "too limited for it to be worth getting financial advice."
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